----

| ·   | Record attributable silver equivalent production for the three months and year ended December 31, 2011 of 6.9 million ounces (6.7 million ounces of silver and 3,900 ounces of gold) and 25.4 million ounces (24.6 million ounces of silver and 18,400 ounces of gold), respectively, representing an increase of 12% and 7% over the comparable periods in 2010. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Record silver equivalent sales for the three months and year ended December 31, 2011 of 6.0 million ounces (5.8 million ounces of silver and 3,800 ounces of gold) and 21.1 million ounces (20.2 million ounces of silver and 18,300 ounces of gold), respectively, representing an increase of 6% and 3% over the comparable periods in 2010. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Revenue for the three months and year ended December 31, 2011 of $191.9 million and $730.0 million, respectively, compared with $149.6 million and $423.4 million for the comparable periods in 2010, with revenue for the most recently completed year representing a record for the Company. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Net earnings for the three months and year ended December 31, 2011 of $144.7 million ($0.41 per share) and $550.0 million ($1.56 per share), respectively, compared with adjusted net earnings1 of $120.7 million ($0.35 per share) and $286.6 million ($0.83 per share) for the comparable periods in 2010, with net earnings for the most recently completed year representing a record for the Company. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Operating cash flows for the three months and year ended December 31, 2011 of $163.7 million ($0.46 per share2) and $626.4 million ($1.77 per share2), respectively, compared with $124.7 million ($0.36 per share2) and $319.7 million ($0.93 per share2) for the comparable periods in 2010, with operating cash flows for the most recently completed year representing a record for the Company. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Average cash costs3 for the three months and year ended December 31, 2011 of $4.06 and $4.09 per silver equivalent ounce, respectively, compared with $4.02 and $4.04 per silver equivalent ounce for the comparable periods in 2010. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Cash operating margin4 for the three months and year ended December 31, 2011 of $28.06 per silver equivalent ounce and $30.56 per silver equivalent ounce, respectively, representing an increase of 25% and 84% over the comparable periods in 2010. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | As at December 31, 2011, approximately 4.1 million payable silver equivalent ounces attributable to the Company have been produced at the various mines and will be recognized in future sales as they are delivered to the Company under the terms of their contracts. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 1   | Refer to discussion on non-IFRS measure (i) on page 19 of this MD&A. |
|---------------|--------------------------------------------------------------------------|

| 2   | Refer to discussion on non-IFRS measure (ii) on pages 19 and 20 of this MD&A. |
|---------------|-----------------------------------------------------------------------------------|

| 3   | Refer to discussion on non-IFRS measure (iii) on page 20 of this MD&A. |
|---------------|----------------------------------------------------------------------------|

| 4   | Refer to discussion on non-IFRS measure (iv) on pages 20 and 21 of this MD&A. |
|---------------|-----------------------------------------------------------------------------------|

----

| ·   | On November 9, 2011, the Board of Directors adopted a new dividend policy linking quarterly dividend payments to operating cash flows in the prior quarter. Under the new dividend policy, the quarterly dividend per common share is equal to 20% of the cash generated by operating activities in the previous quarter divided by the Company’s outstanding common shares at the time the dividend is approved, all rounded to the nearest cent.  Based on operating cash flows generated by the Company during the three months ended December 31, 2011, a dividend of $0.09 per common share has been approved for shareholders of record on April 4, 2012. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | On December 20, 2011, the Company announced the appointment of Mr. Haytham Hodaly as Senior Vice President, Corporate Development, effective January 1, 2012. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Barrick Gold Corporation’s (“Barrick”) world-class gold-silver Pascua-Lama project remains on track to commence production in mid-2013, with approximately 55% of the previously announced pre-production capital budget of $4.7 to $5.0 billion committed.  At the end of the fourth quarter, earthworks in Chile and Argentina were approximately 95% and 65% complete, respectively. Once in production, Pascua-Lama is forecast to be one of the largest and lowest cost gold mines in the world with an expected mine life in excess of 25 years. In its first full five years of operation, Silver Wheaton’s attributable silver production is expected to average nine million ounces annually. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Silver and GoldInterests | Owner            | Location ofMine | Upfront Consideration 1 | Attributable Production to be Purchased          | Term ofAgreement | Date ofContract |
|--------------------------|------------------|-----------------|------------------------------|--------------------------------------------------|------------------|-----------------|
| Silver                   | Gold             |
| San Dimas                | Primero 2        | Mexico          | $                            |      189,799            | 3                | 100% 2          | - | Life of Mine | 15-Oct-04 |
| Zinkgruvan               | Lundin           | Sweden          | $                            |        77,866 |             | 100%            | - | Life of Mine | 8-Dec-04 |
| Yauliyacu                | Glencore         | Peru            | $                            |      285,000            |             | 100% 4          | - | 20 years | 23-Mar-06 |
| Peñasquito          | Goldcorp         | Mexico          | $                            |      485,000            |             | 25%             | - | Life of Mine | 24-Jul-07 |
| Minto                    | Capstone         | Canada          | $                            |        55,296 | 5                | 100%            | 100% 6 | Life of Mine | 1-Dec-08 |
| Cozamin                  | Capstone         | Mexico          | $                            |        41,959 | 5                | 100%            | - | 10 years | 4-Apr-07 |
| Barrick                  |             |            | $                            |      625,000            | 7                |            |   |   |   |
| Pascua-Lama              | Barrick          | Chile/Argentina |                         |                                             |             | 25%             | - | Life of Mine | 8-Sep-09 |
| Lagunas Norte            | Barrick          | Peru            |                         |                                             |             | 100%            | - | 4 years 8 | 8-Sep-09 |
| Pierina                  | Barrick          | Peru            |                         |                                             |             | 100%            | - | 4 years 8 | 8-Sep-09 |
| Veladero                 | Barrick          | Argentina       |                         |                                             |             | 100% 9          | - | 4 years 8 | 8-Sep-09 |
| Other                    |             |            | $                            |   544,303                              |             |            |   |   |   |
| Los Filos                | Goldcorp         | Mexico          | $                            |       4,463        | 3                | 100%            | - | 25 years | 15-Oct-04 |
| Stratoni                 | Eldorado Gold 10 | Greece          | $                            |     57,500                   |             | 100%            | - | Life of Mine | 23-Apr-07 |
| Neves-Corvo              | Lundin           | Portugal        | $                            |     35,350                   | 5                | 100%            | - | 50 years | 5-Jun-07 |
| Aljustrel                | I'M SGPS         | Portugal        | $                            |       2,451        | 5                | 100%            | - | 50 years | 5-Jun-07 |
| Mineral Park             | Mercator         | United States   | $                            |     42,000                   |             | 100%            | - | Life of Mine | 17-Mar-08 |
| Campo Morado             | Nyrstar NV       | Mexico          | $                            |     79,250                   |             | 75%             | - | Life of Mine | 13-May-08 |
| Keno Hill                | Alexco           | Canada          | $                            |     50,000                   |             | 25%             | - | Life of Mine | 2-Oct-08 |
| Rosemont                 | Augusta          | United States   | $                            |   230,000                              | 11               | 100%            | 100% | Life of Mine | 11-Feb-10 |
| Loma de La Plata         | Pan American     | Argentina       | $                            |     43,289                   | 12               | 12.5%           | - | Life of Mine | n/a 13 |

| 1)   | Expressed in United States dollars, rounded to the nearest thousand; excludes closing costs and capitalized interest, where applicable. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------|

| 2)   | Until August 6, 2014, Primero will deliver to Silver Wheaton a per annum amount equal to the first 3.5 million ounces of payable silver produced at San Dimas and 50% of any excess, plus Silver Wheaton will receive an additional 1.5 million ounces of silver per annum to be delivered by Goldcorp.  After August 6, 2014, Primero will deliver a per annum amount to  Silver Wheaton equal to the first 6 million ounces of payable silver produced at San Dimas and 50% of any excess. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3)   | As more fully described in the San Dimas section on page 3 of this MD&A, on August 6, 2010, Goldcorp completed the sale of the San Dimas mine, which was part of the Luismin mining operations (“Luismin”), to Primero.  The original cost of Luismin was allocated to San Dimas and Los Filos based on the estimated fair values of these silver interests as at August 6, 2010. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4)   | To a maximum of 4.75 million ounces per annum.  In the event that silver produced at Yauliyacu in any year totals less than 4.75 million ounces, the amount sold to Silver Wheaton in subsequent years will be increased to  make up for the shortfall, so long as production allows. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5)   | Primarily comprised of the value allocated to the silver and gold interest upon the Company’s acquisition of Silverstone Resources Corp., which was closed on May 21, 2009 (the “Silverstone Acquisition”). |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6)   | The Company is entitled to acquire 100% of the first 30,000 ounces of gold produced per annum and 50% thereafter. |
|----------------|-------------------------------------------------------------------------------------------------------------------|

| 7)   | As more fully described in Note 11 to the financial statements, Silver Wheaton will make total upfront cash payments of $625 million payable in installments, of which $487.5 million has been paid to date. The remaining $137.5 million is payable on the third anniversary of the transaction.  The financial liability relating to these future payments has been discounted using an annual discount rate of 6.9%, which represents management’s best estimate of the market rate of interest at which the Company could borrow money under similar terms and conditions at the time the agreement was entered into. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 8)   | Barrick will deliver to Silver Wheaton silver production from the currently producing mines until December 31, 2013.  In addition, during 2014 and 2015, Silver Wheaton will be entitled to all or a portion of the silver production from these mines to the extent of any production shortfall relative to the production guarantee levels at Pascua-Lama, until Barrick satisfies the completion guarantee. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9)   | Silver Wheaton's attributable silver production is subject to a maximum of 8% of the silver contained in the ore mined at Veladero during the period. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10)   | 95% owned by Eldorado Gold Corporation. |
|-----------------|-----------------------------------------|

| 11)   | Payable on an installment basis to partially fund construction of the Rosemont mine once certain milestones are achieved, including the receipt of key permits and securing the necessary financing to complete construction of the mine. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 12)   | Comprised of $10.9 million allocated to the silver interest upon the Silverstone Acquisition in addition to $32.4 million, the payment of which is contingent upon the satisfaction of certain conditions, including Pan American receiving all necessary permits to proceed with the mine construction. |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 13)   | Definitive terms of the agreement are in the process of being finalized. |
|-----------------|--------------------------------------------------------------------------|

----

----

----

| i.   | As part of the agreement with Goldcorp to acquire silver from the Luismin mining operations, on October 15, 2004, the Company entered into an agreement with Goldcorp to acquire 100% of the silver production from its Los Filos mine in Mexico for a period of 25 years, commencing October 15, 2004.  In addition, pursuant to Goldcorp’s sale of the San Dimas mine, Goldcorp is obligated to deliver to Silver Wheaton 1.5 million ounces of silver per year until August 6, 2014, which is reflected in this MD&A and financial statements as part of the silver production and sales relating to San Dimas; |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 1   | Silver Wheaton's attributable silver production is subject to a maximum of 8% of the silver contained in the ore mined at Veladero during the period. |
|---------------|-------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| ii.   | On April 23, 2007, the Company entered into an agreement with Hellas Gold S.A., a subsidiary of European Goldfields Limited ("European Goldfields"), to acquire 100% of the life of mine silver production from its 95% owned Stratoni mine in Greece.  On February 24, 2012, European Goldfields announced that it had completed the plan of arrangement with Eldorado Gold Corporation ("Eldorado") whereby Eldorado acquired all of the issued and outstanding shares of European Goldfields.  This transaction will have no significant effect on Silver Wheaton's Stratoni silver purchase agreement; |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| iii.   | As part of the Silverstone Acquisition, the Company acquired an agreement with Lundin to acquire 100% of the silver production from its Neves-Corvo mine in Portugal for a period of 50 years, commencing June 5, 2007; |
|------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| iv.   | As part of the Silverstone Acquisition, the Company acquired an agreement with I’M SGPS to acquire 100% of the silver production from its Aljustrel mine in Portugal for a period of 50 years, commencing June 5, 2007; |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| v.   | On March 17, 2008, the Company entered into an agreement with Mercator Minerals Ltd. (“Mercator”) to acquire an amount equal to 100% of the life of mine silver production from its Mineral Park mine in the United States.  As per Mercator’s January 16, 2012 press release, the fourth quarter of 2011 represented the first full quarter of production since the completion of the Phase II mill expansion to 50,000 tons per day at its Mineral Park mine. As a result, the mine achieved record production for both the three months and year ended December 31, 2011; |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| vi.   | On May 13, 2008, the Company entered into an agreement with Farallon Mining Ltd., which was acquired by Nyrstar NV on January 5, 2011, to acquire an amount equal to 75% of the life of mine silver production from its Campo Morado mine in Mexico; |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| vii.   | On October 2, 2008, the Company entered into an agreement with Alexco Resource Corp. (“Alexco”) to acquire an amount equal to 25% of the life of mine silver production from its Keno Hill silver district in Canada, including the currently producing Bellekeno mine.  As per Alexco’s January 23, 2012 disclosure, the Bellekeno mine completed its first full year of operations, having declared commercial production in January of 2011. The mine demonstrated steadily increasing silver production over the course of the year, culminating in record fourth quarter production as the mine approached initial design throughput levels of 250 tonnes per day; |
|------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| viii.   | On February 11, 2010, the Company entered into an agreement with Augusta Resource Corporation (“Augusta”) to acquire an amount equal to 100% of the life of mine silver and gold production from the Rosemont Copper project in the United States; and |
|-------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ix.   | As part of the Silverstone Acquisition, the Company acquired an agreement with Aquiline Resources Inc., which was acquired by Pan American Silver Corp. (“Pan American”) on December 22, 2009, to acquire an amount equal to 12.5% of the life of mine silver production from the Loma de La Plata zone of the Navidad project in Argentina, the definitive terms of which are in the process of being finalized. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 1   | Mineral reserves and mineral resources are reported as of December 31, 2011, other than as disclosed in footnote 6 to the Attributable Reserves and Resources tables on page 34 of this MD&A. |
|---------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                     | December 31 | December 31 | January 1 |
|--------------------------|-------------|-------------|-----------|
| (in thousands)           | 2011        | 2010        | 2010      |
|  Common shares held |        | $           | 149,039   |   | $ | 278,748 |   | $ | 72,502 |
| Warrants held            |        |        | 2,582     |   |   | 5,700 |   |   | 1,245 |
|                |        | $           | 151,621   |   | $ | 284,448 |   | $ | 73,747 |

|             | Dec 312011 | Three Months EndedDec 312011                              | Year EndedDec 312011      | Year EndedDec 312011 |
|------------------|------------|-----------------------------------------------------------|---------------------------|----------------------|
| (in thousands)   | Fair Value |  Fair Value Adjustment Gains(Losses) Included in OCI | Realized Gain on Disposal |
|  Bear Creek | $          | 46,171                                                    | $                         | (4,389)              | $ | (80,524) | $ | - |
| Revett           |       | 23,793                                                    |                      | 4,092                |   | (1,043) |   | - |
| Sabina           |       | 44,177                                                    |                      | 11,067               |   | (21,817) |   | - |
| Other            |       | 34,898                                                    |                      | (78)                 |   | (15,730) |   | 4,532 |
|        | $          | 149,039                                                   | $                         | 10,692               | $ | (119,114) | $ | 4,532 |

|                | Dec 312010 | Three Months EndedDec 312010                     | Year EndedDec 312010      |  Year EndedDec 312010 | Jan 12010 |
|---------------------|------------|--------------------------------------------------|---------------------------|----------------------------|-----------|
| (in thousands)      | Fair Value |  Fair Value Adjustment GainsIncluded in OCI | Realized Loss on Disposal | Fair Value                 |
|  Bear Creek    | $          | 126,695                                          | $                         | 47,179                     | $         | 69,578  | $ | - | $ | 38,232  |
| Revett              |       | 24,836                                           |                      | 12,599                     |      | 16,682 |   |  - |   | 5,815 |
| Sabina              |       | 65,993                                           |                      | 13,242                     |      | 39,827 |   |  - |   | 9,241 |
| Other               |       | 61,224                                           |                      | 21,107                     |      | 20,256 |   | (171) |   | 19,214 |
|      | $          | 278,748                                          | $                         | 94,127                     | $         | 146,343 | $ | (171) | $ | 72,502 |

----

|           | Dec 312011 | Three Months EndedDec 312011                                       | Year EndedDec 312011      | Year EndedDec 312011 |
|----------------|------------|--------------------------------------------------------------------|---------------------------|----------------------|
| (in thousands) | Fair Value |  Fair Value Adjustment Gains(Losses) Included in Net Earnings | Realized Loss on Disposal |
|  Revett   | $          | 741                                                                | $                         | 188                  | $ | (55) | $ | - |
| Other          |       | 1,841                                                              |                      | 74                   |   | (3,063) |   | (16) |
|      | $          | 2,582                                                              | $                         | 262                  | $ | (3,118) | $ | (16) |

|           | Dec 312010 | Three Months EndedDec 312010                                       | Year EndedDec 312010 | Jan 12010 |
|----------------|------------|--------------------------------------------------------------------|----------------------|-----------|
| (in thousands) | Fair Value |  Fair Value Adjustment Gains(Losses) Included in Net Earnings | Fair Value           |
|  Revett   | $          | 796                                                                | $                    | 568       | $ | 948 | $ | 282 |
| Sabina         |       | -                                                                  |                 | (1,085)   |   | 6,368 |   | 75 |
| Other          |       | 4,904                                                              |                 | 3,142     |   | 3,403 |   | 888 |
|      | $          | 5,700                                                              | $                    | 2,625     | $ | 10,719 | $ | 1,245 |

----

----

|                                                                                       | Year Ended December 31 |
|--------------------------------------------------------------------------------------------|------------------------|
|                                                                                       | 2011IFRS 1             | 2010IFRS 1 | 2009GAAP 1 |
|  Silver equivalent production 2                                                       |                   |   |   |   |   |   |   |   |   |
| Attributable silver ounces produced (000’s)                                          |                   |   | 24,557 |   |   | 21,984 |   |   | 16,263 |
| Attributable gold ounces produced                                                          |                   |   | 18,436 |   |   | 28,795 |   |   | 18,021 |
| Attributable silver equivalent ounces produced (000’s) 2                             |                   |   | 25,374 |   |   | 23,758 |   |   | 17,395 |
| Silver equivalent sales 2                                                                  |                   |   |   |   |   |   |   |   |   |
| Silver ounces sold (000’s)                                                           |                   |   | 20,247 |   |   | 18,878 |   |   | 14,744 |
| Gold ounces sold                                                                           |                   |   | 18,256 |   |   | 25,884 |   |   | 17,132 |
| Silver equivalent ounces sold (000’s) 2                                              |                   |   | 21,069 |   |   | 20,483 |   |   | 15,823 |
| Average realized price ($'s per ounce)                                                     |                   |   |   |   |   |   |   |   |   |
| Average realized silver price                                                              |                   | $ | 34.60 |   | $ | 20.75 |   | $ | 15.02 |
| Average realized gold price                                                                |                   | $ | 1,609 |   | $ | 1,224 |   | $ | 1,042 |
| Average realized silver equivalent price 2                                                 |                   | $ | 34.65 |   | $ | 20.67 |   | $ | 15.13 |
| Average cash cost ($'s per ounce) 3                                                        |                   |   |   |   |   |   |   |   |   |
| Average silver cash cost                                                                   |                   | $ | 3.99 |   | $ | 3.97 |   | $ | 3.97 |
| Average gold cash cost                                                                     |                   | $ | 300 |   | $ | 300 |   | $ | 300 |
| Average silver equivalent cash cost 2                                                      |                   | $ | 4.09 |   | $ | 4.04 |   | $ | 4.03 |
|  Total revenue ($000's)                                                               |                   | $ | 729,997 |   | $ | 423,353 |   | $ | 239,293 |
|  Net earnings                                                                         |                   | $ | 550,028 |   | $ | 153,381 |   | $ | 117,924 |
| Add back - loss on fair value adjustment of Canadian dollar share purchase warrants issued |                   |   |                   - |   |   | 133,210 |   |   |                   - |
|  Adjusted net earnings 4 ($000's)                                                     |                   | $ | 550,028 |   | $ | 286,591 |   | $ | 117,924 |
|  Earnings per share                                                                   |                   |   |   |   |   |   |   |   |   |
| Basic                                                                                      |                   | $ | 1.56 |   | $ | 0.45 |   | $ | 0.39 |
| Diluted                                                                                    |                   | $ | 1.55 |   | $ | 0.44 |   | $ | 0.38 |
|  Adjusted earnings per share 4                                                        |                   |   |   |   |   |   |   |   |   |
| Basic                                                                                      |                   | $ | 1.56 |   | $ | 0.83 |   | $ | 0.39 |
| Diluted                                                                                    |                   | $ | 1.55 |   | $ | 0.83 |   | $ | 0.38 |
|  Cash flow from operations ($000's)                                                   |                   | $ | 626,427 |   | $ | 319,726 |   | $ | 165,932 |
|  Dividends                                                                            |                   |   |   |   |   |   |   |   |   |
| Dividends paid                                                                             |                   | $ | 63,612 |   | $ |                   - |   | $ |                   - |
| Dividends paid per share                                                                   |                   | $ | 0.18 |   | $ | 0.00 |   | $ | 0.00 |
|  Total assets ($000's)                                                                |                   | $ | 2,872,335 |   | $ | 2,635,383 |   | $ | 2,237,224 |
|  Total non-current financial liabilities ($000’s)                               |                   | $ | 50,060 |   | $ | 200,966 |   | $ | 343,976 |
|   Shareholders' equity ($000's)                                                       |                   | $ | 2,654,217 |   | $ | 2,261,949 |   | $ | 1,723,925 |

| 1)   | 2011 and 2010 figures presented in accordance with IFRS.  2009 figures presented in accordance with Canadian Generally Accepted Accounting Principles (“Cdn GAAP” or “GAAP”).  Certain comparative figures have been reclassified to conform to the presentation adopted in 2011. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2)   | Gold ounces produced and sold are converted to a silver equivalent basis on the ratio of the average silver price received to the average gold price received during the period from the assets that produce both gold and silver. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3)   | Refer to discussion on non-IFRS measure (iii) on page 20 of this MD&A. |
|----------------|----------------------------------------------------------------------------|

| 4)   | Refer to discussion on non-IFRS measure (i) on page 19 of this MD&A. |
|----------------|--------------------------------------------------------------------------|

----

|                                                                               | 2011                                                            | 2010                                                                       |
|------------------------------------------------------------------------------------|-----------------------------------------------------------------|----------------------------------------------------------------------------|
|  (in thousands)                                                               | Q4                                                              | Q3                                                                         | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 |
|  Silver ounces produced 1                                                     |                                                            |                                                                       |   |   |   |   |   |   |
| San Dimas 2                                                                        |        1,578                 |        1,251                            |        1,150 |        1,606 |        1,586 |        1,255 |        1,110 |        1,206 |
| Zinkgruvan                                                                         |           390 |           379            |           414 |           508 |           428 |           508 |           478 |           387 |
| Yauliyacu                                                                          |           583 |           608            |           674 |           683 |           651 |           633 |           692 |           737 |
| Peñasquito                                                                    |        1,633                 |        1,162                            |        1,282 |        1,207 |        1,260 |        1,109 |           866 |           557 |
| Cozamin                                                                            |           433 |           395            |           414 |           325 |           335 |           381 |           286 |           401 |
| Barrick 3                                                                          |           723 |           794            |           741 |           722 |           458 |           682 |           697 |           780 |
| Other 4                                                                            |        1,389                 |        1,272                            |        1,153 |        1,088 |        1,245 |        1,069 |        1,240 |           947 |
|                                                                               |        6,729                 |        5,861                            |        5,828 |        6,139 |        5,963 |        5,637 |        5,369 |        5,015 |
| Silver equivalent ounces of gold produced 5                                        |                                                            |                                                                       |   |   |   |   |   |   |
| Minto                                                                              |           202 |           257            |           261 |             97 |           205 |           402 |           522 |           645 |
|  Silver equivalent ounces produced                                            |        6,931                 |        6,118                            |        6,089 |        6,236 |        6,168 |        6,039 |        5,891 |        5,660 |
|  Silver ounces sold                                                           |                                                            |                                                                       |   |   |   |   |   |   |
| San Dimas 2                                                                        |        1,488                 |        1,232                            |        1,149 |        1,748 |        1,438 |        1,274 |        1,076 |        1,206 |
| Zinkgruvan                                                                         |           425 |           319            |           401 |           321 |           421 |           635 |           313 |           498 |
| Yauliyacu                                                                          |           655 |             11 |           471 |           120 |           470 |             87 |           517 |           581 |
| Peñasquito                                                                    |           851 |        1,382                            |           961 |           941 |        1,169 |           692 |           656 |           424 |
| Cozamin                                                                            |           374 |           335            |           281 |           271 |           411 |           306 |           412 |           281 |
| Barrick 3                                                                          |           755 |           747            |           726 |           680 |           482 |           533 |           727 |           783 |
| Other 4                                                                            |        1,230                 |           770            |           862 |           741 |        1,139 |           750 |           943 |           654 |
|                                                                               |        5,778                 |        4,796                            |        4,851 |        4,822 |        5,530 |        4,277 |        4,644 |        4,427 |
| Silver equivalent ounces of gold sold 5                                            |                                                            |                                                                       |   |   |   |   |   |   |
| Minto                                                                              |           196 |           316            |           227 |             83 |           127 |           411 |           496 |           571 |
|  Silver equivalent ounces sold                                                |        5,974                 |        5,112                            |        5,078 |        4,905 |        5,657 |        4,688 |        5,140 |        4,998 |
|  Gold / silver ratio 5                                                        |          51.9      |          50.4                 |          40.1 |          33.0 |          49.7 |          57.7 |          65.4 |          66.3 |
|  Cumulative payable silver equivalent ounces produced but not yet delivered 6 |        4,127                 |        3,805                            |        3,537 |        3,018 |        2,275 |        2,174 |        1,403 |        1,437 |

| 1)   | Ounces produced represent the quantity of silver and gold contained in concentrate or doré prior to smelting or refining deductions.  Certain production figures are based on management estimates. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2)   | Beginning in the third quarter of 2010, the ounces produced and sold include ounces received from Goldcorp in connection with Goldcorp’s four year commitment  to deliver to Silver Wheaton 1.5 million ounces of silver per annum resulting from their sale of San Dimas to Primero. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3)   | Comprised of the Lagunas Norte, Pierina and Veladero silver interests. |
|----------------|------------------------------------------------------------------------|

| 4)   | Comprised of the Los Filos, Mineral Park, Neves-Corvo, Stratoni, Keno Hill, Minto, Aljustrel and Campo Morado silver interests in addition to the previously owned La Negra and San Martin silver interests. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5)   | Gold ounces produced and sold are converted to a silver equivalent basis on the ratio of the average silver price received to the average gold price received during the period from the assets that produce both gold and silver. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6)   | Based on management estimates. |
|----------------|--------------------------------|

----

|                                                               | 2011   | 2010   |
|--------------------------------------------------------------------|--------|--------|
|                                                          | Q4     | Q3     | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 |
|  Total silver ounces sold (000's)                             |   |   |           5,778 |   |   |           4,796 |   |   |            4,851 |   |   |          4,822 |   |   |          5,530 |   |   |             4,277 |   |   |          4,644 |   |   |          4,427 |
| Average realized silver price 1                                    |   | $      | 32.09 |   | $ | 36.44 |   | $ | 38.38 |   | $ | 32.00 |   | $ | 26.41 |   | $ | 19.51 |   | $ | 18.46 |   | $ | 17.27 |
| Silver sales (000's)                                               |   | $      | 185,401 |   | $ | 174,733 |   | $ | 186,191 |   | $ | 154,304 |   | $ | 146,030 |   | $ | 83,409 |   | $ | 85,759 |   | $ | 76,462 |
| Total gold ounces sold                                             |   |   |           3,777 |   |   |           6,280 |   |   |           5,674 |   |   |          2,524 |   |   |          2,562 |   |   |              7,127 |   |   |          7,584 |   |   |            8,611 |
| Average realized gold price 1                                      |   | $      | 1,712 |   | $ | 1,666 |   | $ | 1,509 |   | $ | 1,537 |   | $ | 1,384 |   | $ | 1,323 |   | $ | 1,219 |   | $ | 1,100 |
| Gold sales (000's)                                                 |   | $      | 6,466 |   | $ | 10,462 |   | $ | 8,561 |   | $ | 3,879 |   | $ | 3,547 |   | $ | 9,425 |   | $ | 9,245 |   | $ | 9,476 |
| Total silver equivalent ounces sold (000's) 2                      |   |   |           5,974 |   |   |             5,112 |   |   |           5,078 |   |   |          4,905 |   |   |          5,657 |   |   |             4,688 |   |   |           5,140 |   |   |          4,998 |
| Average realized silver equivalent price 1                         |   | $      | 32.12 |   | $ | 36.23 |   | $ | 38.35 |   | $ | 32.24 |   | $ | 26.44 |   | $ | 19.81 |   | $ | 18.48 |   | $ | 17.20 |
| Total sales (000's)                                                |   | $      | 191,867 |   | $ | 185,195 |   | $ | 194,752 |   | $ | 158,183 |   | $ | 149,577 |   | $ | 92,834 |   | $ | 95,004 |   | $ | 85,938 |
| Average cash cost, silver 1, 3                                     |   | $      | 4.01 |   | $ | 3.99 |   | $ | 3.98 |   | $ | 3.98 |   | $ | 3.97 |   | $ | 3.98 |   | $ | 3.97 |   | $ | 3.97 |
| Average cash cost, gold 1, 3                                       |   | $      | 301 |   | $ | 300 |   | $ | 300 |   | $ | 300 |   | $ | 300 |   | $ | 300 |   | $ | 300 |   | $ | 300 |
| Average cash cost, silver equivalent 1, 2, 3                       |   | $      | 4.06 |   | $ | 4.12 |   | $ | 4.14 |   | $ | 4.07 |   | $ | 4.02 |   | $ | 4.09 |   | $ | 4.03 |   | $ | 4.04 |
| Net earnings (000's)                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| As reported under Cdn GAAP                                         |   |   | - |   |   | - |   |   | - |   |   | - |   | $ | 122,973 |   | $ | 69,233 |   | $ | 53,257 |   | $ | 44,630 |
| Adjustments under IFRS                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (Loss) gain on fair value adjustment of warrants issued            |   |   | - |   |   | - |   |   | - |   |   | - |   |   | (56,832) |   |   | (45,276) |   |   | (37,408) |   |   | 6,306 |
| Reallocation of realized gain on disposal of long-term investments |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | (150) |   |   | - |
| Income tax expense                                                 |   |   | - |   |   | - |   |   | - |   |   | - |   |   | (2,242) |   |   | (287) |   |   | (446) |   |   | (377) |
| As reported under IFRS                                             |   | $      | 144,747 |   | $ | 135,040 |   | $ | 148,065 |   | $ | 122,176 |   | $ | 63,899 |   | $ | 23,670 |   | $ | 15,253 |   | $ | 50,559 |
| Earnings per share                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| As reported under GAAP                                             |   |   | - |   |   | - |   |   | - |   |   | - |   | $ | 0.35 |   | $ | 0.20 |   | $ | 0.16 |   | $ | 0.13 |
| IFRS adjustments                                                   |   |   | - |   |   | - |   |   | - |   |   | - |   |   | (0.17) |   |   | (0.13) |   |   | (0.12) |   |   | 0.02 |
| As reported under IFRS                                             |   | $      | 0.41 |   | $ | 0.38 |   | $ | 0.42 |   | $ | 0.35 |   | $ | 0.18 |   | $ | 0.07 |   | $ | 0.04 |   | $ | 0.15 |
| Diluted                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| As reported under GAAP                                             |   |   | - |   |   | - |   |   | - |   |   | - |   | $ | 0.35 |   | $ | 0.20 |   | $ | 0.15 |   | $ | 0.13 |
| IFRS adjustments                                                   |   |   | - |   |   | - |   |   | - |   |   | - |   |   | (0.17) |   |   | (0.13) |   |   | (0.11) |   |   | - |
| As reported under IFRS                                             |   | $      | 0.41 |   | $ | 0.38 |   | $ | 0.42 |   | $ | 0.34 |   | $ | 0.18 |   | $ | 0.07 |   | $ | 0.04 |   | $ | 0.13 |
| Cash flow from operations (000's)                                  |   | $      | 163,714 |   | $ | 167,236 |   | $ | 168,281 |   | $ | 127,196 |   | $ | 124,675 |   | $ | 70,473 |   | $ | 66,978 |   | $ | 57,600 |
| Cash flow from operations per share 4                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                                              |   | $      | 0.46 |   | $ | 0.47 |   | $ | 0.48 |   | $ | 0.36 |   | $ | 0.36 |   | $ | 0.20 |   | $ | 0.20 |   | $ | 0.17 |
| Diluted                                                            |   | $      | 0.46 |   | $ | 0.47 |   | $ | 0.47 |   | $ | 0.36 |   | $ | 0.36 |   | $ | 0.20 |   | $ | 0.19 |   | $ | 0.17 |
| Dividends                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Dividends paid                                                     |   | $      | 31,814 |   | $ | 10,603 |   | $ | 10,599 |   | $ | 10,595 |   | $ | 0.00 |   | $ | 0.00 |   | $ | 0.00 |   | $ | 0.00 |
| Dividends paid per share                                           |   | $      | 0.09 |   | $ | 0.03 |   | $ | 0.03 |   | $ | 0.03 |   | $ | 0.00 |   | $ | 0.00 |   | $ | 0.00 |   | $ | 0.00 |
| Total assets (000's)                                               |   | $      | 2,872,335 |   | $ | 2,760,675 |   | $ | 2,807,346 |   | $ | 2,757,065 |   | $ | 2,635,383 |   | $ | 2,363,943 |   | $ | 2,379,790 |   | $ | 2,286,425 |
| Total liabilities (000's)                                          |   | $      | 218,118 |   | $ | 229,676 |   | $ | 359,544 |   | $ | 363,131 |   | $ | 373,434 |   | $ | 507,077 |   | $ | 613,115 |   | $ | 554,222 |
| Total shareholders' equity (000's)                                 |   | $      | 2,654,217 |   | $ | 2,530,999 |   | $ | 2,447,802 |   | $ | 2,393,934 |   | $ | 2,261,949 |   | $ | 1,856,866 |   | $ | 1,766,675 |   | $ | 1,732,203 |

| 1)   | Expressed as United States dollars per ounce. |
|----------------|-----------------------------------------------|

| 2)   | Gold ounces sold are converted to a silver equivalent basis on the ratio of the average silver price received to the average gold price received during the period from the assets that produce both gold and silver. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3)   | Refer to discussion on non-IFRS measure (iii) on page 20 of this MD&A. |
|----------------|----------------------------------------------------------------------------|

| 4)   | Refer to discussion on non-IFRS measure (ii) on pages 19 and 20 of this MD&A. |
|----------------|-----------------------------------------------------------------------------------|

----

| Three Months Ended December 31, 2011 |
|--------------------------------------|
|                                 | Ounces produced 2 | Ouncessold | Sales |  Averagerealizedprice ($'sper ounce) | Averagecash cost($'s perounce) 3 | Averagedepletion($'s perounce) | Netearnings | Cash flowfrom(used in)operations | Total assets |
|  Silver                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| San Dimas 4                          | 1,578 | 1,488 | $ | 44,641 | $ | 30.00 | $ | 4.09 | $ | 0.71 | $ | 37,494 | $ | 38,551 | $ | 167,527 |
| Zinkgruvan                           | 390 | 425 |   | 13,537 |   | 31.87 |   | 4.10 |   | 1.69 |   | 11,077 |   | 14,061 |   | 57,639 |
| Yauliyacu                            | 583 | 655 |   | 22,270 |   | 34.00 |   | 4.02 |   | 5.02 |   | 16,350 |   | 19,637 |   | 230,012 |
| Peñasquito                      | 1,633 | 851 |   | 27,374 |   | 32.17 |   | 3.96 |   | 2.41 |   | 21,954 |   | 24,004 |   | 504,973 |
| Cozamin                              | 433 | 374 |   | 12,786 |   | 34.18 |   | 4.08 |   | 4.62 |   | 9,531 |   | 10,260 |   | 25,115 |
| Barrick 5                            | 723 | 755 |   | 24,673 |   | 32.67 |   | 3.90 |   | 3.60 |   | 19,008 |   | 21,728 |   | 601,085 |
| Other 6                              | 1,389 | 1,230 |   | 40,120 |   | 32.63 |   | 3.94 |   | 4.22 |   | 30,089 |   | 36,301 |   | 251,716 |
|                                 | 6,729 | 5,778 | $ | 185,401 | $ | 32.09 | $ | 4.01 | $ | 2.90 | $ | 145,503 | $ | 164,542 | $ | 1,838,067 |
| Gold                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Minto                                | 3,891 | 3,777 |   | 6,466 |   | 1,712 |   | 301 |   | 169 |   | 4,689 |   | 6,314 |   | 33,659 |
|  Silver Equivalent 7            | 6,931 | 5,974 | $ | 191,867 | $ | 32.12 | $ | 4.06 | $ | 2.91 | $ | 150,192 | $ | 170,856 | $ | 1,871,726 |
| Corporate                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| General and administrative           |   |   |   |   |   |   |   |   |   | $ | (6,115) |   |   |   |   |
| Other                                |   |   |   |   |   |   |   |   |   |   |   | 670 |   |   |   |   |
| Total corporate                      |   |   |   |   |   |   |   |   |   |   | $ | (5,445) | $ | (7,142) | $ | 1,000,609 |
|                            | 6,931 | 5,974 | $ | 191,867 | $ | 32.12 | $ | 4.06 | $ | 2.91 | $ | 144,747 | $ | 163,714 | $ | 2,872,335 |

| 1)   | All figures in thousands except gold ounces produced and sold and per ounce amounts. |
|----------------|--------------------------------------------------------------------------------------|

| 2)   | Ounces produced represent the quantity of silver and gold contained in concentrate or doré prior to smelting or refining deductions.  Certain production figures are based on management estimates. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3)   | Refer to discussion on non-IFRS measure (iii) on page 20 of this MD&A. |
|----------------|----------------------------------------------------------------------------|

| 4)   | Results for San Dimas include 375,000 ounces received from Goldcorp in connection with Goldcorp’s four year commitment to deliver to Silver Wheaton 1.5 million ounces of silver per annum resulting from their sale of San Dimas to Primero. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5)   | Comprised of the Lagunas Norte, Pierina and Veladero silver interests. |
|----------------|------------------------------------------------------------------------|

| 6)   | Comprised of the Los Filos, Mineral Park, Neves-Corvo, Stratoni, Keno Hill, Minto, Campo Morado and Aljustrel silver interests. |
|----------------|---------------------------------------------------------------------------------------------------------------------------------|

| 7)   | Gold ounces produced and sold are converted to a silver equivalent basis on the ratio of the average silver price received to the average gold price received during the period from the assets that produce both gold and silver. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Three Months Ended December 31, 2010                                            |
|---------------------------------------------------------------------------------|
|                                                                            | Ounces produced 2 | Ouncessold | Sales |  Averagerealizedprice ($'sper ounce) | Averagecash cost($'s perounce) 3 | Averagedepletion($'s perounce) | Netearnings | Cash flowfrom(used in)operations | Total assets |
|  Silver                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| San Dimas 4                                                                     | 1,586 | 1,438 | $ | 39,283 | $ | 27.33 | $ | 4.05 | $ | 0.78 | $ | 32,351 | $ | 34,567 | $ | 171,524 |
| Zinkgruvan                                                                      | 428 | 421 |   | 12,483 |   | 29.64 |   | 4.05 |   | 1.69 |   | 10,062 |   | 10,600 |   | 60,122 |
| Yauliyacu                                                                       | 651 | 470 |   | 10,627 |   | 22.61 |   | 3.98 |   | 3.47 |   | 7,124 |   | 8,756 |   | 236,320 |
| Peñasquito                                                                 | 1,260 | 1,169 |   | 31,166 |   | 26.66 |   | 3.90 |   | 2.54 |   | 23,634 |   | 26,607 |   | 514,930 |
| Cozamin                                                                         | 335 | 411 |   | 10,953 |   | 26.67 |   | 4.04 |   | 4.62 |   | 7,396 |   | 8,729 |   | 30,949 |
| Barrick 5                                                                       | 458 | 482 |   | 11,369 |   | 23.58 |   | 3.90 |   | 3.61 |   | 7,749 |   | 10,890 |   | 595,307 |
| Other 6                                                                         | 1,245 | 1,139 |   | 30,149 |   | 26.47 |   | 3.92 |   | 4.81 |   | 20,207 |   | 24,452 |   | 266,978 |
|                                                                            | 5,963 | 5,530 | $ | 146,030 | $ | 26.41 | $ | 3.97 | $ | 2.81 | $ | 108,523 | $ | 124,601 | $ | 1,876,130 |
| Gold                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Minto                                                                           | 4,130 | 2,562 |   | 3,547 |   | 1,384 |   | 300 |   | 237 |   | 2,172 |   | 3,816 |   | 36,747 |
|  Silver Equivalent 7                                                       | 6,168 | 5,657 | $ | 149,577 | $ | 26.44 | $ | 4.02 | $ | 2.86 | $ | 110,695 | $ | 128,417 | $ | 1,912,877 |
| Corporate                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| General and administrative                                                      |   |   |   |   |   |   |   |   |   | $ | (6,409) |   |   |   |   |
| Loss on fair value adjustment of Canadian dollar share purchase warrants issued |   | (56,832) |   |   |   |   |
| Other                                                                           |   |   |   |   |   |   |   |   |   |   |   | 16,445 |   |   |   |   |
| Total corporate                                                                 |   |   |   |   |   |   |   |   |   |   | $ | (46,796) | $ | (3,742) | $ | 722,506 |
|                                                                       | 6,168 | 5,657 | $ | 149,577 | $ | 26.44 | $ | 4.02 | $ | 2.86 | $ | 63,899 | $ | 124,675 | $ | 2,635,383 |

| 1)   | All figures in thousands except gold ounces produced and sold and per ounce amounts. |
|----------------|--------------------------------------------------------------------------------------|

| 2)   | Ounces produced represent the quantity of silver and gold contained in concentrate or doré prior to smelting or refining deductions.  Certain production figures are based on management estimates. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3)   | Refer to discussion on non-IFRS measure (iii) on page 20 of this MD&A. |
|----------------|----------------------------------------------------------------------------|

| 4)   | Results for San Dimas include 375,000 ounces received from Goldcorp in connection with Goldcorp’s four year commitment to deliver to Silver Wheaton 1.5 million ounces of silver per annum resulting from their sale of San Dimas to Primero. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5)   | Comprised of the Lagunas Norte, Pierina and Veladero silver interests. |
|----------------|------------------------------------------------------------------------|

| 6)   | Comprised of the Los Filos, Mineral Park, Neves-Corvo, Stratoni, Minto and Campo Morado silver interests in addition to the previously owned La Negra and San Martin silver interests. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 7)   | Gold ounces produced and sold are converted to a silver equivalent basis on the ratio of the average silver price received to the average gold price received during the period from the assets that produce both gold and silver. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | $6.2 million increase as a result of a 6% increase in the number of silver equivalent ounces sold, primarily related to: |
|--------------------|--------------------------------------------------------------------------------------------------------------------------|

| i.   | $2.8 million increase as a result of a 39% increase in silver deliveries from Yauliyacu primarily due to the shipment of previously produced bulk concentrate, the processing of which was delayed due to the shutdown of the Doe Run smelter; and |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ii.   | $4.4 million increase as a result of a 57% increase in silver deliveries from the Barrick mines, primarily due to higher grades and throughput; and |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------|

| iii.   | $5.7 million increase as a result of the timing of shipments of stockpiled concentrate, primarily relating to Minto and Mineral Park; partially offset by |
|------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

| iv.   | $6.4 million decrease as a result of a 27% decrease in silver deliveries from Peñasquito as a result of the timing of shipments of stockpiled concentrate; and |
|-----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | $32.8 million increase as a result of a 22% increase in the average realized selling price of silver; and |
|--------------------|-----------------------------------------------------------------------------------------------------------|

| ·   | $41.4 million increase as a result of a decrease in corporate costs, as explained in the Corporate Costs section of this MD&A ($3.4 million increase from a cash flow perspective). |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Year Ended December 31, 2011 |
|------------------------------|
|                         | Ounces produced 2 | Ouncessold | Sales |  Averagerealizedprice ($'sper ounce) | Averagecash cost($'s perounce) 3 | Averagedepletion($'s perounce) | Netearnings | Cash flowfrom(used in)operations | Total assets |
|  Silver                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| San Dimas 4                  | 5,585 | 5,617 | $ | 188,377 | $ | 33.54 | $ | 4.06 | $ | 0.71 | $ | 161,554 | $ | 164,453 | $ | 167,527 |
| Zinkgruvan                   | 1,691 | 1,466 |   | 52,974 |   | 36.14 |   | 4.08 |   | 1.69 |   | 44,503 |   | 49,377 |   | 57,639 |
| Yauliyacu                    | 2,548 | 1,257 |   | 43,911 |   | 34.93 |   | 4.02 |   | 5.02 |   | 32,555 |   | 38,863 |   | 230,012 |
| Peñasquito              | 5,284 | 4,135 |   | 143,069 |   | 34.61 |   | 3.93 |   | 2.41 |   | 116,855 |   | 126,812 |   | 504,973 |
| Cozamin                      | 1,567 | 1,261 |   | 43,990 |   | 34.85 |   | 4.07 |   | 4.62 |   | 33,018 |   | 40,586 |   | 25,115 |
| Barrick 5                    | 2,980 | 2,908 |   | 102,454 |   | 35.23 |   | 3.90 |   | 3.58 |   | 80,692 |   | 89,554 |   | 601,085 |
| Other 6                      | 4,902 | 3,603 |   | 125,854 |   | 34.93 |   | 3.94 |   | 4.27 |   | 96,298 |   | 112,414 |   | 251,716 |
|                         | 24,557 | 20,247 | $ | 700,629 | $ | 34.60 | $ | 3.99 | $ | 2.69 | $ | 565,475 | $ | 622,059 | $ | 1,838,067 |
| Gold                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Minto                        | 18,436 | 18,256 |   | 29,368 |   | 1,609 |   | 300 |   | 169 |   | 20,799 |   | 24,240 |   | 33,659 |
|  Silver Equivalent 7    | 25,374 | 21,069 | $ | 729,997 | $ | 34.65 | $ | 4.09 | $ | 2.73 | $ | 586,274 | $ | 646,299 | $ | 1,871,726 |
| Corporate                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| General and administrative   |   |   |   |   |   |   |   |   |   | $ | (25,180) |   |   |   |   |
| Other                        |   |   |   |   |   |   |   |   |   |   |   | (11,066) |   |   |   |   |
| Total corporate              |   |   |   |   |   |   |   |   |   |   | $ | (36,246) | $ | (19,872) | $ | 1,000,609 |
|                    | 25,374 | 21,069 | $ | 729,997 | $ | 34.65 | $ | 4.09 | $ | 2.73 | $ | 550,028 | $ | 626,427 | $ | 2,872,335 |

| 1)   | All figures in thousands except gold ounces produced and sold and per ounce amounts. |
|----------------|--------------------------------------------------------------------------------------|

| 2)   | Ounces produced represent the quantity of silver and gold contained in concentrate or doré prior to smelting or refining deductions.  Certain production figures are based on management estimates. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3)   | Refer to discussion on non-IFRS measure (iii) on page 20 of this MD&A. |
|----------------|----------------------------------------------------------------------------|

| 4)   | Results for San Dimas include 1.5 million ounces received from Goldcorp in connection with Goldcorp’s four year commitment to deliver to Silver Wheaton 1.5 million ounces of silver per annum resulting from their sale of San Dimas to Primero. |
|----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5)   | Comprised of the Lagunas Norte, Pierina and Veladero silver interests. |
|----------------|------------------------------------------------------------------------|

| 6)   | Comprised of the Los Filos, Mineral Park, Neves-Corvo, Stratoni, Keno Hill, Minto, Campo Morado and Aljustrel silver interests. |
|----------------|---------------------------------------------------------------------------------------------------------------------------------|

| 7)   | Gold ounces produced and sold are converted to a silver equivalent basis on the ratio of the average silver price received to the average gold price received during the period from the assets that produce both gold and silver. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Year Ended December 31, 2010                                                    |
|---------------------------------------------------------------------------------|
|                                                                            | Ounces produced 2 | Ouncessold | Sales |  Averagerealizedprice ($'sper ounce) | Averagecash cost($'s perounce) 3 | Averagedepletion($'s perounce) | Netearnings | Cash flowfrom(used in)operations | Total assets |
|  Silver                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| San Dimas 4                                                                     | 5,157 | 4,994 | $ | 105,747 | $ | 21.18 | $ | 4.04 | $ | 0.78 | $ | 81,659 | $ | 86,666 | $ | 171,524 |
| Zinkgruvan                                                                      | 1,801 | 1,867 |   | 39,447 |   | 21.12 |   | 4.04 |   | 1.71 |   | 28,697 |   | 30,178 |   | 60,122 |
| Yauliyacu                                                                       | 2,713 | 1,655 |   | 31,998 |   | 19.33 |   | 3.98 |   | 3.47 |   | 19,669 |   | 25,418 |   | 236,320 |
| Peñasquito                                                                 | 3,792 | 2,941 |   | 63,632 |   | 21.64 |   | 3.90 |   | 2.54 |   | 44,683 |   | 52,163 |   | 514,930 |
| Cozamin                                                                         | 1,403 | 1,410 |   | 29,180 |   | 20.71 |   | 4.03 |   | 4.62 |   | 16,987 |   | 23,252 |   | 30,949 |
| Barrick 5                                                                       | 2,617 | 2,525 |   | 48,311 |   | 19.13 |   | 3.90 |   | 3.55 |   | 29,498 |   | 36,787 |   | 595,307 |
| Other 6                                                                         | 4,501 | 3,486 |   | 73,345 |   | 21.04 |   | 3.92 |   | 4.49 |   | 44,010 |   | 58,182 |   | 266,978 |
|                                                                            | 21,984 | 18,878 | $ | 391,660 | $ | 20.75 | $ | 3.97 | $ | 2.73 | $ | 265,203 | $ | 312,646 | $ | 1,876,130 |
| Gold                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Minto                                                                           | 28,795 | 25,884 |   | 31,693 |   | 1,224 |   | 300 |   | 236 |   | 17,830 |   | 23,174 |   | 36,747 |
|  Silver Equivalent 7                                                       | 23,758 | 20,483 | $ | 423,353 | $ | 20.67 | $ | 4.04 | $ | 2.81 | $ | 283,033 | $ | 335,820 | $ | 1,912,877 |
| Corporate                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| General and administrative                                                      |   |   |   |   |   |   |   |   |   | $ | (24,669) |   |   |   |   |
| Loss on fair value adjustment of Canadian dollar share purchase warrants issued |   | (133,210) |   |   |   |   |
| Other                                                                           |   |   |   |   |   |   |   |   |   |   |   | 28,227 |   |   |   |   |
| Total corporate                                                                 |   |   |   |   |   |   |   |   |   |   | $ | (129,652) | $ | (16,094) | $ | 722,506 |
|                                                                       | 23,758 | 20,483 | $ | 423,353 | $ | 20.67 | $ | 4.04 | $ | 2.81 | $ | 153,381 | $ | 319,726 | $ | 2,635,383 |

| 1)   | All figures in thousands except gold ounces produced and sold and per ounce amounts. |
|----------------|--------------------------------------------------------------------------------------|

| 2)   | Ounces produced represent the quantity of silver and gold contained in concentrate or doré prior to smelting or refining deductions.  Certain production figures are based on management estimates. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3)   | Refer to discussion on non-IFRS measure (iii) on page 20 of this MD&A. |
|----------------|----------------------------------------------------------------------------|

| 4)   | Results for San Dimas include 625,000 ounces received from Goldcorp in connection with Goldcorp’s four year commitment to deliver to Silver Wheaton 1.5 million ounces of silver per annum resulting from their sale of San Dimas to Primero. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5)   | Comprised of the Lagunas Norte, Pierina and Veladero silver interests. |
|----------------|------------------------------------------------------------------------|

| 6)   | Comprised of the Los Filos, Mineral Park, Neves-Corvo, Stratoni, Minto and Campo Morado silver interests in addition to the previously owned La Negra and San Martin silver interests. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 7)   | Gold ounces produced and sold are converted to a silver equivalent basis on the ratio of the average silver price received to the average gold price received during the period from the assets that produce both gold and silver. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | $21.6 million increase as a result of a 7% increase in the number of silver ounces sold, primarily due to: |
|--------------------|------------------------------------------------------------------------------------------------------------|

| i.   | $10.2 million increase as a result of a 13% increase in silver deliveries relating to San Dimas reflecting the delivery of 1.5 million ounces due from Goldcorp in connection with Goldcorp’s four year commitment to deliver to Silver Wheaton 1.5 million ounces of silver per annum resulting from their sale of San Dimas to Primero, as compared to 0.6 million ounces during the comparable period of the previous year; and |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ii.   | $4.5 million increase as a result of a 15% increase in silver deliveries from the Barrick mines, primarily due to higher grades and throughput; and |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------|

| iii.   | $18.1 million increase as a result of a 41% increase in silver deliveries from Peñasquito reflecting the continued ramping up of milling operations; partially offset by |
|------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| iv.   | $10.9 million decrease as a result of the timing of shipments of stockpiled concentrate, primarily relating to Yauliyacu and Zinkgruvan, with Yauliyacu reflecting the delay in processing bulk concentrate as a result of the closing of the Doe Run smelter; |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | $5.3 million decrease as a result of a 30% decrease in the number of gold ounces sold due to lower grade stockpiled ore processed after cessation of mining from the Stage 4 Main Pit at the Minto mine; and |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | $280.5 million increase as a result of a 67% increase in the average realized selling price of silver; and |
|--------------------|------------------------------------------------------------------------------------------------------------|

| ·   | $7.0 million increase as a result of a 31% increase in the average realized selling price of gold; and |
|--------------------|--------------------------------------------------------------------------------------------------------|

| ·   | $93.4 million increase as a result of a decrease in corporate costs, as explained in the Corporate Costs section of this MD&A ($3.8 million increase from a cash flow perspective). |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                                            | Three Months EndedDecember 31 | Year EndedDecember 31 |
|---------------------------------------------------------------------------------|-------------------------------|-----------------------|
| (in thousands)                                                                  | 2011                          | 2010                  | 2011 | 2010 |
|  General and administrative                                                | $                             | 4,556                 | $ | 5,108 | $ | 18,851 | $ | 16,937 |
| Equity settled stock based compensation (a non-cash item)                       |                          | 1,559                 |   | 1,301 |   | 6,329 |   | 7,732 |
|  Total general and administrative                                          | $                             | 6,115                 | $ | 6,409 | $ | 25,180 | $ | 24,669 |
| Loss on fair value adjustment of Canadian dollar share purchase warrants issued |                          |  -               |   | 56,832 |   |  - |   | 133,210 |
| Foreign exchange gain                                                           |                          | 65                    |   | (1,579) |   | (453) |   | (2,266) |
| Other expense (income)                                                          |                          | (345)                 |   | (8,393) |   | 3,182 |   | (16,089) |
| Income tax expense (recovery)                                                   |                          | (390)                 |   | (6,473) |   | 8,337 |   | (9,872) |
|  Total corporate costs                                                     | $                             | 5,445                 | $ | 46,796 | $ | 36,246 | $ | 129,652 |

----

| i.   | Adjusted net earnings and adjusted net earnings per share is calculated by removing the effects of the non-cash, fair value adjustment on the Company’s previously issued and outstanding share purchase warrants which had an exercise price denominated in Canadian dollars from net earnings of the Company.  As more fully described in Note 12 to the financial statements, these warrants are classified as a financial liability with any fair value adjustments being reflected as a component of net earnings.  The Company believes that, in addition to conventional measures prepared in accordance with IFRS, the Company and certain investors use this information to evaluate the Company’s performance. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                                                       |   | Three Months EndedDecember 31 | Year EndedDecember 31 |
|--------------------------------------------------------------------------------------------|--------|-------------------------------|-----------------------|
| (in thousands, except for per share amounts)                                               |   | 2011                          |                  | 2010 |   | 2011 |   | 2010 |
|  Net earnings                                                                         |   | $                             | 144,747               |   | $ | 63,899 |   | $ | 550,028 |   | $ | 153,381 |
| Add back - loss on fair value adjustment of Canadian dollar share purchase warrants issued |   |                          | -                     |   |   | 56,832 |   |   | - |   |   | 133,210 |
|  Adjusted net earnings                                                                |   | $                             | 144,747               |   | $ | 120,731 |   | $ | 550,028 |   | $ | 286,591 |
|  Divided by:                                                                          |   |                          |                  |   |   |   |   |   |   |   |   |   |
| Basic weighted average number of shares outstanding                                        |   |                          | 353,497               |   |   | 347,611 |   |   | 353,249 |   |   | 344,288 |
| Diluted weighted average number of shares outstanding                                      |   |                          | 355,797               |   |   | 350,618 |   |   | 355,904 |   |   | 346,508 |
|  Equals:                                                                              |   |                          |                  |   |   |   |   |   |   |   |   |   |
| Adjusted earnings per share - basic                                                        |   | $                             | 0.41                  |   | $ | 0.35 |   | $ | 1.56 |   | $ | 0.83 |
| Adjusted earnings per share - diluted                                                      |   | $                             | 0.41                  |   | $ | 0.34 |   | $ | 1.55 |   | $ | 0.83 |

| ii.   | Operating cash flow per share (basic and diluted) is calculated by dividing cash generated by operating activities by the weighted average number of shares outstanding (basic and diluted).  The Company presents operating cash flow per share as it believes that certain investors use this information to evaluate the Company’s performance in comparison to other companies in the precious metals mining industry who present results on a similar basis. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                  |   | Three Months EndedDecember 31 | Year EndedDecember 31 |
|-------------------------------------------------------|--------|-------------------------------|-----------------------|
| (in thousands, except for per share amounts)          |   | 2011                          |                  | 2010 |   | 2011 |   | 2010 |
|  Cash generated by operating activities          |   | $                             | 163,714               |   | $ | 124,675 |   | $ | 626,427 |   | $ | 319,726 |
|  Divided by:                                     |   |                          |                  |   |   |   |   |   |   |   |   |   |
| Basic weighted average number of shares outstanding   |   |                          | 353,497               |   |   | 347,611 |   |   | 353,249 |   |   | 344,288 |
| Diluted weighted average number of shares outstanding |   |                          | 355,797               |   |   | 350,618 |   |   | 355,904 |   |   | 346,508 |
|  Equals:                                         |   |                          |                  |   |   |   |   |   |   |   |   |   |
| Operating cash flow per share - basic                 |   | $                             | 0.46                  |   | $ | 0.36 |   | $ | 1.77 |   | $ | 0.93 |
| Operating cash flow per share - diluted               |   | $                             | 0.46                  |   | $ | 0.36 |   | $ | 1.76 |   | $ | 0.92 |

| iii.   | Average cash cost of silver and gold on a per ounce basis is calculated by dividing the total cost of sales, less depletion, by the ounces sold.  In the precious metals mining industry, this is a common performance measure but does not have any standardized meaning.  The Company believes that, in addition to conventional measures prepared in accordance with IFRS, certain investors use this information to evaluate the Company’s performance and ability to generate cash flow. |
|------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                              | Three Months EndedDecember 31 | Year EndedDecember 31 |
|-------------------------------------------------------------------|-------------------------------|-----------------------|
| (in thousands, except for gold ounces sold and per ounce amounts) |                          | 2011                  |   | 2010 |   | 2011 |   | 2010 |
|  Cost of sales                                               |                          | $                     | 41,675 |   | $ | 38,882 |   | $ | 143,723 |   | $ | 140,320 |
| Less:  depletion                                        |                          |                  | (17,393) |   |   | (16,154) |   |   | (57,457) |   |   | (57,571) |
|  Cash cost of sales                                          |                          | $                     | 24,282 |   | $ | 22,728 |   | $ | 86,266 |   | $ | 82,749 |
|  Cash cost of sales is comprised of:                         |                          |                  |   |   |   |   |   |   |   |   |   |   |
| Total cash cost of silver sold                                    |                          | $                     | 23,144 |   | $ | 21,960 |   | $ | 80,785 |   | $ | 74,984 |
| Total cash cost of gold sold                                      |                          |                  | 1,138 |   |   | 768 |   |   | 5,481 |   |   | 7,765 |
|  Total cash cost of sales                                    |                          | $                     | 24,282 |   | $ | 22,728 |   | $ | 86,266 |   | $ | 82,749 |
|  Divided by:                                                 |                          |                  |   |   |   |   |   |   |   |   |   |   |
| Total silver ounces sold                                          |                          |                  | 5,778 |   |   | 5,530 |   |   | 20,247 |   |   | 18,878 |
| Total gold ounces sold                                            |                          |                  | 3,777 |   |   | 2,562 |   |   | 18,256 |   |   | 25,884 |
| Total silver equivalent ounces sold 1                             |                          |                  | 5,974 |   |   | 5,657 |   |   | 21,069 |   |   | 20,483 |
|  Equals:                                                     |                          |                  |   |   |   |   |   |   |   |   |   |   |
| Average cash cost of silver (per ounce)                           |                          | $                     | 4.01 |   | $ | 3.97 |   | $ | 3.99 |   | $ | 3.97 |
| Average cash cost of gold (per ounce)                             |                          | $                     | 301 |   | $ | 300 |   | $ | 300 |   | $ | 300 |
| Average cash cost (per silver equivalent ounce 1)                 |                          | $                     | 4.06 |   | $ | 4.02 |   | $ | 4.09 |   | $ | 4.04 |

| 1)   | Gold ounces sold are converted to a silver equivalent basis on the ratio of the average silver price received to the average gold price received during the period from the assets that produce both silver and gold. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| iv.   | Cash operating margin is calculated by subtracting the average cash cost of silver and gold on a per ounce basis from the average realized selling price of silver and gold on a per ounce basis.  The Company presents cash operating margin as it believes that certain investors use this information to evaluate the Company’s performance in comparison to other companies in the precious metals mining industry who present results on a similar basis. |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                                      |   | Three Months EndedDecember 31 |    | Year EndedDecember 31 |
|---------------------------------------------------------------------------|--------|-------------------------------|---------|-----------------------|
| (in thousands, except for per ounce amounts)                              |   | 2011                          |    | 2010                  |   | 2011 |   | 2010 |
|  Average realized selling price of silver and gold                   |   |                          |    |                  |   |   |   |   |   |   |   |   |
| Sales                                                                     |   | $                             | 191,867 |                  | $ | 149,577 |   | $ | 729,997 |   | $ | 423,353 |
| Divided by - total silver equivalent ounces sold 1                        |   |                          | 5,974   |                  |   | 5,657 |   |   | 21,069 |   |   | 20,483 |
|  Equals - average realized price ($'s per silver equivalent ounce 1) |   | $                             | 32.12   |                  | $ | 26.44 |   | $ | 34.65 |   | $ | 20.67 |
| Less - average cash cost ($'s per silver equivalent ounce 1)              |   |                          | (4.06)  |                  |   | (4.02) |   |   | (4.09) |   |   | (4.04) |
|  Cash operating margin                                               |   | $                             | 28.06   |                  | $ | 22.42 |   | $ | 30.56 |   | $ | 16.63 |

| 1)   | Gold ounces sold are converted to a silver equivalent basis on the ratio of the average silver price received to the average gold price received during the period from the assets that produce both silver and gold. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Silver and Gold Interests | Attributable Payable Production to be Purchased | Per Ounce Cash Payment 1,2 | Term ofAgreement | Date ofContract |
|---------------------------|-------------------------------------------------|----------------------------|------------------|-----------------|
| Silver                    | Gold                                            | Silver                     | Gold             |
| San Dimas                 | 100% 3                                          | -                          | $                | 4.08            |   | n/a | Life of Mine | 15-Oct-04 |
| Zinkgruvan                | 100%                                            | -                          | $                | 4.14            |   | n/a | Life of Mine | 8-Dec-04 |
| Yauliyacu                 | 100% 4                                          | -                          | $                | 4.02            |   | n/a | 20 years | 23-Mar-06 |
| Peñasquito           | 25%                                             | -                          | $                | 3.96            |   | n/a | Life of Mine | 24-Jul-07 |
| Minto                     | 100%                                            | 100% 5                     | $                | 3.94            | $ | 303 | Life of Mine | 1-Dec-08 |
| Cozamin                   | 100%                                            | -                          | $                | 4.08 6          |   | n/a | 10 years | 4-Apr-07 |
| Barrick                   |                                            |                       |             |            |   |   |   |   |
| Pascua-Lama               | 25%                                             | -                          | $                | 3.90            |   | n/a | Life of Mine | 8-Sep-09 |
| Lagunas Norte             | 100%                                            | -                          | $                | 3.90            |   | n/a | 4 years 7 | 8-Sep-09 |
| Pierina                   | 100%                                            | -                          | $                | 3.90            |   | n/a | 4 years 7 | 8-Sep-09 |
| Veladero                  | 100% 8                                          | -                          | $                | 3.90            |   | n/a | 4 years 7 | 8-Sep-09 |
| Other                     |                                            |                       |             |            |   |   |   |   |
| Los Filos 3               | 100%                                            | -                          | $                | 4.13            |   | n/a | 25 years | 15-Oct-04 |
| Keno Hill                 | 25%                                             | -                          | $                | 3.90            |   | n/a | Life of Mine | 2-Oct-08 |
| Mineral Park              | 100%                                            | -                          | $                | 3.90            |   | n/a | Life of Mine | 17-Mar-08 |
| Neves-Corvo               | 100%                                            | -                          | $                | 3.98            |   | n/a | 50 years | 5-Jun-07 |
| Stratoni                  | 100%                                            | -                          | $                | 3.98            |   | n/a | Life of Mine | 23-Apr-07 |
| Campo Morado              | 75%                                             | -                          | $                | 3.90            |   | n/a | Life of Mine | 13-May-08 |
| Aljustrel                 | 100%                                            | -                          | $                | 3.94            |   | n/a | 50 years | 5-Jun-07 |
| Loma de La Plata          | 12.5%                                           | -                          | $                | 4.00            |   | n/a | Life of Mine | n/a 9 |
| Rosemont                  | 100%                                            | 100%                       | $                | 3.90            | $ | 450 | Life of Mine | 11-Feb-10 |

| 1)   | Subject to an annual inflationary adjustment with the exception of Loma de La Plata. |
|----------------|--------------------------------------------------------------------------------------|

| 2)   | Should the prevailing market price for silver or gold be lower than this amount, the per ounce cash payment will be reduced to the prevailing market price, with the exception of Yauliyacu. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3)   | Until August 6, 2014, Silver Wheaton is committed to purchase from Primero a per annum amount equal to the first 3.5 million ounces of payable silver produced at San Dimas and 50% of any excess, plus Silver Wheaton is committed to purchase an additional 1.5 million ounces of silver per annum to be delivered by Goldcorp for a per ounce cash payment equal to that applicable under the Los Filos silver purchase agreement.  After August 6, 2014, Silver Wheaton is committed to purchase from Primero a per annum amount equal to the first 6 million ounces of payable silver produced at San Dimas and 50% of any excess. |
|----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4)   | To a maximum of 4.75 million ounces per annum.  In the event that silver produced at Yauliyacu in any year totals less than 4.75 million ounces, the amount sold to Silver Wheaton in subsequent years will be increased to  make up for the shortfall, so long as production allows.  The cumulative shortfall as at March 23, 2011, representing the five year anniversary, was 9.8 million ounces. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5)   | The Company is committed to acquire 100% of the first 30,000 ounces of gold produced per annum and 50% thereafter. |
|----------------|--------------------------------------------------------------------------------------------------------------------|

| 6)   | The payment per ounce of silver delivered from the Cozamin mine may be subject to price adjustments in certain circumstances, the effects of which are being reviewed.  Management believes that ultimately no adjustment will be necessary, and, as a result, no provision has been made in these financial statements for any such adjustment. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 7)   | The Company is committed to purchase silver production from the currently producing mines until December 31, 2013.  In addition, during 2014 and 2015, the Company is committed to purchase all or a portion of the silver production from these mines to the extent of any production shortfall relative to the production guarantee levels at Pascua-Lama, until Barrick satisfies the completion guarantee. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 8)   | Silver Wheaton's attributable silver production is subject to a maximum of 8% of the silver contained in the ore mined at Veladero during the period. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9)   | Terms of the agreement not yet finalized. |
|----------------|-------------------------------------------|

----

|                                |   | Obligations With Scheduled Payment Dates                                  | Contingent Obligations |                                                                      |      |
|-------------------------------------|--------|---------------------------------------------------------------------------|------------------------|---------------------------------------------------------------------------|-----------|
| (in thousands)                      | 2012   | 2013 - 2015                                                               | 2016 - 2017            | After 2017                                                                | Sub-Total | Total |
|  Bank debt                     | $      |     28,560                                            | $                      |     50,060                                            | $         |             - | $ |             - | $ |     78,620 | $ |             - |  $ |     78,620 |
| Interest on bank debt 1             |   |       1,006                                 |                   |          792                 |      |             - |   |             - |   |       1,798 |   |             - |   |       1,798 |
| Silver interest payments            |   |                                                                      |                   |                                                                      |      |   |   |   |   |   |   |   |   |   |
| Barrick                             |   |   137,500                                                       |                   |             - |      |             - |   |             - |   |   137,500 |   |             - |   |   137,500 |
| Rosemont 2                          |   |             - |                   |             - |      |             - |   |             - |   |             - |   |   230,000 |   |   230,000 |
| Loma de La Plata 2                  |   |             - |                   |             - |      |             - |   |             - |   |             - |   |     32,400 |   |     32,400 |
| Operating leases                    |   |          493                 |                   |       1,534                                 |      |          594 |   |             - |   |       2,621 |   |             - |   |       2,621 |
|  Total contractual obligations | $      |   167,559                                                       | $                      |     52,386                                            | $         |          594 | $ |             - | $ |   220,539 | $ |   262,400 |  $ |   482,939 |

| 1)   | As the applicable interest rates are floating in nature, the interest charges are estimated based on market-based forward interest rate curves at the end of the reporting period. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2)   | See the Contingencies section of this MD&A. |
|----------------|-------------------------------------------------|

----

----

----

----

----

----

| ·   | IFRS 7 – Financial Instruments (amended 2010) |
|--------------------|-----------------------------------------------------|

| ·   | IAS 12 – Income Taxes (amended 2010) |
|--------------------|--------------------------------------------|

| ·   | IAS 1 - Presentation of Financial Statements (amended 2011) |
|--------------------|-------------------------------------------------------------|

| ·   | IFRS 9 (2010) – Financial Instruments (amended 2010) |
|--------------------|------------------------------------------------------------|

| ·   | IFRS 10 - Consolidated Financial Statements (“IFRS 10”) |
|--------------------|--------------------------------------------------------------------------|

| ·   | IFRS 11 - Joint Arrangements (“IFRS 11”) |
|--------------------|-----------------------------------------------------------|

| ·   | IFRS 12 - Disclosure of Interests in Other Entities (“IFRS 12”) |
|--------------------|----------------------------------------------------------------------------------|

| ·   | IFRS 13 - Fair Value Measurement |
|--------------------|---------------------------------------|

| ·   | IAS 19 – Employee Benefits (amended 2011) |
|--------------------|-------------------------------------------------|

| ·   | IAS 27 - Separate Financial Statements (amended 2011) (“IAS 27”) |
|--------------------|------------------------------------------------------------------------------|

| ·   | IAS 28 - Investments in Associates (amended 2011) (“IAS 28”) |
|--------------------|-------------------------------------------------------------------------------|

| ·   | IFRIC 20 - Stripping Costs in the Production Phase of a Surface Mine |
|--------------------|----------------------------------------------------------------------|

----

| ·   | pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with IFRS, and that receipts and expenditures of the Company are being made only in accordance with authorizations of the Company’s management and directors; and, |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the annual financial statements or interim financial statements. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                        | Proven  | Probable | Proven & Probable |    |
|-----------------------------|---------|----------|-----------------------|---------|
|                   | Tonnage | Grade    | Contained             | Tonnage | Grade | Contained | Tonnage | Grade | Contained | Process Recovery % (7) |
| SILVER                      | Mt      | g/t      | M oz                  | Mt      | g/t | M oz | Mt | g/t | M oz |
|  Peñasquito (25%) |    |     |                  |    |   |   |   |   |   |   |
| Mill                        | 156.6   | 28.9     | 145.5                 | 129.3   | 20.2 | 83.8 | 285.9 | 24.9 | 229.3 | 53-65% |
| Heap Leach                  | 8.3     | 14.4     | 3.9                   | 23.0    | 9.4 | 6.9 | 31.4 | 10.7 | 10.8 | 24% |
| San Dimas(10)               | 2.1     | 364.0    | 24.8                  | 3.8     | 314.7 | 38.1 | 5.9 | 332.5 | 62.9 | 94% |
| Pascua-Lama (25%)           | 9.9     | 59.5     | 18.9                  | 86.3    | 54.1 | 150.2 | 96.2 | 54.7 | 169.1 | 82% |
| Lagunas Norte(11)           | 3.3     | 3.2      | 0.3                   | 37.6    | 3.2 | 3.9 | 40.9 | 3.2 | 4.2 | 22% |
| Pierina(11)                 | 2.1     | 19.9     | 1.3                   | 18.9    | 10.8 | 6.6 | 21.0 | 11.8 | 8.0 | 37% |
| Veladero(11)                | 3.7     | 13.4     | 1.6                   | 61.3    | 13.4 | 26.5 | 65.0 | 13.4 | 28.1 | 6% |
| Yauliyacu(12)               | 1.0     | 99.6     | 3.3                   | 2.7     | 105.9 | 9.1 | 3.7 | 104.2 | 12.4 | 85% |
| Neves-Corvo                 |    |     |                  |    |   |   |   |   |   |   |
| Copper                      | 23.2    | 44.0     | 32.9                  | 4.5     | 45.0 | 6.5 | 27.7 | 44.2 | 39.4 | 35% |
| Zinc                        | 19.4    | 67.0     | 41.7                  | 3.8     | 64.0 | 7.8 | 23.1 | 66.5 | 49.5 | 23% |
| Rosemont(13)                | 128.8   | 4.5      | 18.5                  | 366.8   | 3.8 | 44.5 | 495.6 | 3.9 | 62.9 | 80% |
| Mineral Park(13)            | 293.9   | 2.7      | 25.7                  | 74.5    | 2.9 | 7.0 | 368.4 | 2.8 | 32.6 | 49% |
| Zinkgruvan                  |    |     |                  |    |   |   |   |   |   |   |
| Zinc                        | 8.2     | 103.0    | 27.2                  | 2.4     | 60.0 | 4.7 | 10.7 | 93.1 | 31.9 | 70% |
| Copper                      | 2.8     | 32.0     | 2.8                   | 0.1     | 29.0 | 0.1 | 2.8 | 31.9 | 2.9 | 78% |
| Aljustrel                   |    |     |                  |    |   |   |   |   |   |   |
| Copper                      | 2.2     | 19.2     | 1.3                   | 8.4     | 15.3 | 4.1 | 10.6 | 16.1 | 5.5 | 30% |
| Campo Morado (75%)          | 0.7     | 166.7    | 3.8                   | 0.1     | 123.4 | 0.3 | 0.8 | 162.6 | 4.1 | 55% |
| Stratoni                    | 1.7     | 174.0    | 9.3                   | 0.1     | 225.0 | 0.7 | 1.8 | 177.0 | 10.0 | 84% |
| Minto                       | 7.8     | 5.4      | 1.3                   | 5.1     | 4.9 | 0.8 | 12.9 | 5.2 | 2.1 | 80% |
| Cozamin                     |    |     |                  |    |   |   |   |   |   |   |
| Copper                      | 1.6     | 76.3     | 4.0                   | 5.9     | 59.0 | 11.3 | 7.5 | 62.7 | 15.2 | 74% |
| Zinc                        | -       | -        | -                     | 1.9     | 37.2 | 2.2 | 1.9 | 37.2 | 2.2 | 74% |
| Los Filos                   | 81.0    | 5.2      | 13.5                  | 231.2   | 5.4 | 40.2 | 312.2 | 5.3 | 53.6 | 5% |
|                        |    |     |                  |    |   |   |   |   |   |   |
|  Total Silver          |    |     | 381.4                 |    |   | 455.3 |   |   | 836.7 |   |
|  GOLD                  |    |     |                  |    |   |   |   |   |   |   |
| Minto                       | 7.8     | 0.63     | 0.16                  | 5.1     | 0.54 | 0.09 | 12.9 | 0.60 | 0.25 | 74% |
|  Total Gold            |    |     | 0.16                  |    |   | 0.09 |   |   | 0.25 |   |

----

|                        | Measured | Indicated | Measured & Indicated |
|-----------------------------|----------|-----------|--------------------------|
|                   | Tonnage  | Grade     | Contained                | Tonnage | Grade | Contained | Tonnage | Grade | Contained |
| SILVER                      | Mt       | g/t       | M oz                     | Mt | g/t | M oz | Mt | g/t | M oz |
|  Peñasquito (25%) |     |      |                     |   |   |   |   |   |   |
| Mill                        | 34.1     | 13.1      | 14.4                     | 128.2 | 12.4 | 51.1 | 162.3 | 12.6 | 65.5 |
| Heap Leach                  | 1.0      | 4.6       | 0.2                      | 6.2 | 3.9 | 0.8 | 7.2 | 4.0 | 0.9 |
| Pascua-Lama (25%)           | 5.3      | 24.5      | 4.2                      | 55.9 | 23.4 | 42.1 | 61.2 | 23.5 | 46.3 |
| Yauliyacu(12)               | 0.7      | 108.5     | 2.5                      | 6.1 | 192.4 | 37.8 | 6.8 | 183.5 | 40.3 |
| Neves-Corvo                 |     |      |                     |   |   |   |   |   |   |
| Copper                      | 15.4     | 53.0      | 26.2                     | 3.4 | 51.2 | 5.6 | 18.8 | 52.7 | 31.8 |
| Zinc                        | 42.7     | 54.3      | 74.6                     | 14.5 | 49.5 | 23.0 | 57.2 | 53.1 | 97.6 |
| Rosemont(13)                | 7.2      | 3.9       | 0.9                      | 103.0 | 2.7 | 8.8 | 110.2 | 2.7 | 9.7 |
| Mineral Park(13)            | 101.0    | 2.6       | 8.4                      | 175.6 | 2.7 | 15.2 | 276.6 | 2.7 | 23.6 |
| Zinkgruvan                  |     |      |                     |   |   |   |   |   |   |
| Zinc                        | 0.9      | 123.4     | 3.8                      | 3.3 | 109.5 | 11.5 | 4.2 | 112.6 | 15.2 |
| Copper                      | 2.7      | 24.4      | 2.1                      | 0.1 | 38.5 | 0.1 | 2.8 | 24.9 | 2.2 |
| Aljustrel                   |     |      |                     |   |   |   |   |   |   |
| Zinc                        | 1.3      | 65.6      | 2.7                      | 20.5 | 60.3 | 39.7 | 21.8 | 60.7 | 42.4 |
| Copper                      | -        | -         | -                        | 0.1 | 11.7 | 0.04 | 0.1 | 11.7 | 0.04 |
| Campo Morado (75%)          | 2.1      | 162.1     | 10.8                     | 4.4 | 158.0 | 22.5 | 6.5 | 159.3 | 33.2 |
| Loma de La Plata (12.5%)    | -        | -         | -                        | 3.6 | 169.0 | 19.8 | 3.6 | 169.0 | 19.8 |
| Minto                       | 5.4      | 3.8       | 0.6                      | 19.2 | 2.9 | 1.8 | 24.6 | 3.1 | 2.4 |
| Cozamin                     |     |      |                     |   |   |   |   |   |   |
| Copper                      | 0.6      | 81.5      | 1.5                      | 1.0 | 54.9 | 1.8 | 1.6 | 64.3 | 3.3 |
| Keno Hill (25%)             |     |      |                     |   |   |   |   |   |   |
| Underground                 | -        | -         | -                        | 0.3 | 545.4 | 4.5 | 0.3 | 545.4 | 4.5 |
| Elsa Tailings               | -        | -         | -                        | 0.6 | 119.0 | 2.4 | 0.6 | 119.0 | 2.4 |
| Los Filos                   | 7.9      | 9.5       | 2.4                      | 42.7 | 7.2 | 9.9 | 50.6 | 7.6 | 12.4 |
|                        |     |      |                     |   |   |   |   |   |   |
|  Total Silver          |     |      | 155.2                    |   |   | 298.4 |   |   | 453.6 |
|  GOLD                  |     |      |                     |   |   |   |   |   |   |
| Minto                       | 5.4      | 0.47      | 0.08                     | 19.2 | 0.24 | 0.15 | 24.6 | 0.29 | 0.23 |
|  Total Gold            |     |      | 0.08                     |   |   | 0.15 |   |   | 0.23 |

----

|                        | Inferred |
|-----------------------------|----------|
|                   | Tonnage  | Grade | Contained |
| SILVER                      | Mt       | g/t | M oz |
|  Peñasquito (25%) |     |   |   |
| Mill                        | 36.7     | 8.8 | 10.4 |
| Heap Leach                  | 14.1     | 1.7 | 0.8 |
| San Dimas(10)               | 16.9     | 329.8 | 178.7 |
| Pascua-Lama (25%)           | 8.1      | 15.5 | 4.0 |
| Yauliyacu(12)               | 13.8     | 163.5 | 72.7 |
| Neves-Corvo                 |     |   |   |
| Copper                      | 28.5     | 40.0 | 36.6 |
| Zinc                        | 33.0     | 55.0 | 58.3 |
| Rosemont(13)                | 163.0    | 2.1 | 11.2 |
| Mineral Park(13)            | 320.1    | 2.3 | 23.9 |
| Zinkgruvan                  |     |   |   |
| Zinc                        | 5.6      | 69.0 | 12.4 |
| Copper                      | 0.8      | 36.0 | 0.9 |
| Aljustrel                   |     |   |   |
| Zinc                        | 8.7      | 50.4 | 14.0 |
| Copper                      | 4.7      | 16.0 | 2.4 |
| Campo Morado (75%)          | 2.4      | 117.3 | 9.1 |
| Stratoni                    | 0.7      | 217.0 | 4.7 |
| Loma de La Plata (12.5%)    | 0.2      | 76.0 | 0.4 |
| Minto                       | 6.0      | 2.8 | 0.5 |
| Cozamin                     |     |   |   |
| Copper                      | 2.4      | 52.6 | 4.0 |
| Zinc                        | 1.7      | 30.1 | 1.6 |
| Keno Hill (25%)             |     |   |   |
| Underground                 | 0.1      | 340.1 | 1.4 |
| Los Filos                   | 158.4    | 5.9 | 29.9 |
|                        |     |   |   |
|  TOTAL SILVER          |     |   | 477.9 |
|  GOLD                  |     |   |   |
| Minto                       | 6.0      | 0.25 | 0.05 |
|  TOTAL GOLD            |     |   | 0.05 |

----

| 1.   | All Mineral Reserves and Mineral Resources have been calculated in accordance with the CIM Standards and NI 43-101, or the AusIMM JORC equivalent. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------|

| 2.   | Mineral Reserves and Mineral Resources are reported above in millions of metric tonnes (“Mt”), grams per metric tonne (“g/t”) and millions of ounces (“Moz”). |
|----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.   | Individual qualified persons (“QPs”), as defined by the NI 43-101, for the Mineral Reserve and Mineral Resource estimates are as follows: |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------|

| a.   | Peñasquito – Guillermo Pareja, Ph.D., P.Geo. (Manager, Mineral Resources), Peter Nahan, P.Eng. (Senior Evaluation Engineer), both employees of Goldcorp Inc. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| b.   | San Dimas –Velasquez Spring, P.Eng. (Senior Geologist, Watts, Griffis and McOuat Limited). |
|----------------|--------------------------------------------------------------------------------------------------|

| c.   | Pascua-Lama – Dino Pilotto, P.Eng. (Principal Mining Consultant, SRK Consulting (Canada) Inc.); Bart A. Stryhas, Ph.D., CPG (Principal Resource Geologist, SRK Consulting (U.S.) Inc.). |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| d.   | Yauliyacu – Neil Burns, M.Sc., P.Geo. (Vice President, Technical Services); Samuel Mah, M.A.Sc., P.Eng. (Director of Engineering), both employees of the Company (the “Company’s QPs”). |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.   | The Mineral Resources reported in the above tables are exclusive of Mineral Reserves.  The Minto, Cozamin, Campo Morado, Neves-Corvo, Zinkgruvan and Aljustrel mines report Mineral Resources inclusive of Mineral Reserves.  The Company’s QPs have made the exclusive Mineral Resource estimates for these mines based on average mine recoveries and dilution. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5.   | Mineral Resources which are not Mineral Reserves do not have demonstrated economic viability. |
|----------------|-----------------------------------------------------------------------------------------------|

| 6.   | Other than as detailed below, Mineral Reserves and Mineral Resources are reported as of December 31, 2011, based on information available to the Company as of the date of this document, and therefore will not reflect updates, if any, after such date.  The most current Mineral Reserves and Mineral Resources will be available on the Company's website. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| a.   | Resources and Reserves for San Dimas are reported as of December 31, 2010. |
|----------------|----------------------------------------------------------------------------|

| b.   | Resources and Reserves for Yauliyacu, Neves-Corvo and Zinkgruvan are reported as of June 30, 2011. |
|----------------|----------------------------------------------------------------------------------------------------|

| c.   | Resources for Rosemont are reported as of October 22, 2008 and Reserves as of March 17, 2009. |
|----------------|-----------------------------------------------------------------------------------------------|

| d.   | Resources for Mineral Park are reported as of December 29, 2006. |
|----------------|------------------------------------------------------------------|

| e.   | Resources and Reserves for Aljustrel’s Feitais and Moinho deposits are reported as of November 30, 2010, Resources for the Estaçao deposit are reported as of December 31, 2007. |
|----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| f.   | Resources for Campo Morado’s El Rey, Naranjo and Reforma deposits are reported as of October 13, 2005. |
|----------------|--------------------------------------------------------------------------------------------------------------|

| g.   | Resources and Reserves for Stratoni are reported as of August 10, 2010. |
|----------------|-------------------------------------------------------------------------|

| h.   | Resources and Reserves for Minto are reported as of December 31, 2010. |
|----------------|------------------------------------------------------------------------|

| i.   | Resources and Reserves for Cozamin are reported as of December 31, 2009. |
|----------------|--------------------------------------------------------------------------|

| j.   | Resources for Keno Hill’s Lucky Queen and Onek deposits are reported as of June 30, 2011 and April 22, 2010 for the Elsa Tailings. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------|

| k.   | Resources for Loma de La Plata are reported as of May 20, 2009. |
|----------------|-----------------------------------------------------------------|

| 7.   | Process recoveries are the average percentage of silver in a saleable product (doré or concentrate) recovered from mined ore at the applicable site process plants as reported by the operators. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 8.   | Mineral Reserves are estimated using appropriate process recovery rates and commodity prices of $20.00 per ounce of silver, unless otherwise noted below: |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

| a.   | Pascua-Lama, Lagunas Norte, Veladero and Pierina – $22.00 per ounce. |
|----------------|----------------------------------------------------------------------------|

| b.   | Yauliyacu - $30.00 per ounce. |
|----------------|-------------------------------|

| c.   | Neves-Corvo – 1.4% Cu cut-off for the copper Reserve and 5.0% Zn cut-off for the all zinc Reserves except for Lombador which was reported above a cut-off of 6.0% Zn. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| d.   | Rosemont –$10.00 per ounce. |
|----------------|-----------------------------------|

| e.   | Mineral Park – $7.50 per ounce. |
|----------------|---------------------------------------|

| f.   | Zinkgruvan – 3.7% Zn equivalent cut-off for the zinc Reserve and 1.8% Cu cut-off for the copper Reserve. |
|----------------|----------------------------------------------------------------------------------------------------------------|

| g.   | Aljustrel – 1.5% Cu cut-off for all copper Reserves, 4.5% Zn cut-off for all zinc Reserves. |
|----------------|---------------------------------------------------------------------------------------------------|

| h.   | Campo Morado - $30.00 per ounce. |
|----------------|----------------------------------|

| i.   | Minto – $3.90 per ounce silver and $300 per ounce gold. |
|----------------|---------------------------------------------------------------|

| j.   | Cozamin – $4.00 per ounce. |
|----------------|----------------------------------|

| 9.   | Mineral Resources are estimated using appropriate recovery rates and commodity prices of $24.00 per ounce of silver, unless otherwise noted below: |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------|

| a.   | Pascua-Lama, Lagunas Norte, Veladero and Pierina – $28.00 per ounce. |
|----------------|----------------------------------------------------------------------------|

| b.   | Yauliyacu – $30.00 per ounce. |
|----------------|-------------------------------------|

| c.   | Neves-Corvo – 1.0% Cu cut-off for the copper Resource and 3.0% Zn cut-off for the zinc Resource. |
|----------------|--------------------------------------------------------------------------------------------------------|

| d.   | Rosemont – 0.2% Cu cut-off. |
|----------------|-----------------------------------|

----

| e.   | Zinkgruvan – 3.1% Zn equivalent cut-off for the zinc Resource and 1.5% Cu cut-off for the copper Resource. |
|----------------|------------------------------------------------------------------------------------------------------------------|

| f.   | Mineral Park – $7.50 per ounce. |
|----------------|---------------------------------------|

| g.   | Aljustrel – 1.5% Cu cut-off for all copper Resources, 4.5% Zn cut-off for Feitais and Moinho zinc Resources and 4.0% for Estação zinc Resources. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| h.   | Campo Morado – $30.00 per ounce for the G-9 zones and 5% Zn cut-off for the El Rey, Naranjo and Reforma deposits. |
|----------------|-------------------------------------------------------------------------------------------------------------------------|

| i.   | Loma de La Plata – $12.50 per ounce. |
|----------------|--------------------------------------------|

| j.   | Minto – $12.00 per ounce silver and $900 per ounce gold. |
|----------------|----------------------------------------------------------------|

| k.   | Cozamin – 1.15% Cu cut-off for San Roberto Area and 3.0% Zn cut-off for San Rafael Area. |
|----------------|------------------------------------------------------------------------------------------------|

| l.   | Keno Hill – $15.25 per ounce for the Southwest and 99 Zones, $14.50 per ounce for the East Zone, $17.00 per ounce for the Elsa Tailings and $18.50 per ounce for the Lucky Queen and Onek deposits. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.   | The San Dimas silver purchase agreement provides that from August 6, 2010 until August 5, 2014, Primero will deliver to the Company a per annum amount equal to the first 3.5 million ounces of payable silver produced at San Dimas and 50% of any excess, plus the Company will receive an additional 1.5 million ounces of silver per annum to be delivered by Goldcorp.  Beginning August 6, 2014, Primero will deliver to the Company a per annum amount equal to the first 6.0 million ounces of payable silver produced at San Dimas and 50% of any excess, for the life of the mine.  As per Primero’s press release on January 17, 2012, Primero is undertaking a review of the reserve and resource estimation methods currently, and historically, used at San Dimas in order to determine whether other estimation methods might be used to improve predictability of operating results and, therefore, assist long term planning.  While the results of this review are not currently known, the adoption of any new estimation methods may result in the Silver Wheaton reporting different and potentially lower total mineral reserve and total mineral resource numbers.  Primero also states in their press release that it is not expected that any potential change in estimates will change the level of confidence Primero has in the ultimate mineral potential of San Dimas and that the review of estimation methodology is being driven by a desire to determine if greater operating predictability and improved mine planning can be achieved. |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.   | The Company’s attributable tonnage at Pierina was estimated by assuming 2011 production level for the remaining two years.  The Company’s attributable tonnage at Lagunas Norte and Veladero was estimated by assuming 2012 and 2013 processed tonnes based on Barrick's life of mine ("LOM") plans.  Tonnes for all three operations were pro-rated between Proven and Probable Mineral Reserves according to the ratio of Barrick’s December 31, 2011 Proven and Probable Mineral Reserves.  Average reserve grades were applied to the Pierina estimates and the average LOM plan grades were applied to Lagunas Norte and Veladero.  LOM plans and December 31, 2011 Mineral Reserves estimates are as published by Barrick. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 12.   | The Company’s Yauliyacu silver purchase agreement (March 2006) with Glencore International AG provides for the delivery of up to 4.75 million ounces of silver per year for 20 years.  In the event that silver produced at Yauliyacu in any year totals less than 4.75 million ounces, the maximum amount to be sold to the Company in subsequent years will be increased to make up the shortfall, so long as production allows.  Depending upon production levels, it is possible that the Company’s current attributable tonnage may not be mined before the agreement expires. |
|-----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 13.   | The Mineral Park and Rosemont Resources and Reserves do not include the SX/EW leach material since this process does not recover silver. |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------|

| 14.   | The Company has filed a technical report for each of its mineral projects considered to be material to the Company, being San Dimas, Yauliyacu, Peñasquito and Pascua-Lama, which are available on SEDAR at www.sedar.com. |
|-----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 15.   | Silver is produced as a by-product metal at all operations with the exception of the Keno Hill mine and Loma de La Plata project; therefore, the economic cut-off applied to the reporting of silver Resources and Reserves will be influenced by changes in the commodity prices of other metals at the time. |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

|  /s/ Randy Smallwood                                    |   |  /s/ Gary Brown                                                |   |
|-------------------------------------------------------------------|--------|---------------------------------------------------------------------|--------|
| Randy Smallwood President & Chief Executive Officer |   | Gary Brown Senior Vice President & Chief Financial Officer |   |

----

----

| i.   | pertain to the maintenance of records that accurately and fairly reflect, in reasonable detail, the transactions related to Silver Wheaton’s assets |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

| ii.   | provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with IFRS, and Silver Wheaton receipts and expenditures are made only in accordance with authorizations of management and Silver Wheaton’s directors |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| iii.   | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of Silver Wheaton’s assets that could have a material effect on Silver Wheaton’s financial statements. |
|------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  /s/ Randy Smallwood                                    |   |  /s/ Gary Brown                                                |   |
|-------------------------------------------------------------------|--------|---------------------------------------------------------------------|--------|
| Randy Smallwood President & Chief Executive Officer |   | Gary Brown Senior Vice President & Chief Financial Officer |   |

----

----

|                                                                                                                |   | Year Ended December 31 |
|---------------------------------------------------------------------------------------------------------------------|--------|------------------------|
| (US dollars and shares in thousands, except per share amounts)                                                      | Note   | 2011                   | 2010 |
|  Sales                                                                                                         | 5      | $                      | 729,997 | $ | 423,353 |
|  Cost of sales                                                                                                 |   |                   |   |   |   |
| Cost of sales, excluding depletion                                                                                  |   | $                      | 86,266 | $ | 82,749 |
| Depletion                                                                                                           |   |                   | 57,457 |   | 57,571 |
| Total cost of sales                                                                                                 |   | $                      | 143,723 | $ | 140,320 |
|  Earnings from operations                                                                                      |   | $                      | 586,274 | $ | 283,033 |
|  Expenses and other income                                                                                     |   |                   |   |   |   |
| General and administrative 1                                                                                   | 6      | $                      | 25,180 | $ | 24,669 |
| Loss on fair value adjustment of Canadian dollar share purchase warrants issued                                     | 12     |                   | - |   | 133,210 |
| Foreign exchange gain                                                                                               |   |                   | (453) |   | (2,266) |
| Other expense (income)                                                                                              |   |                   | 3,182 |   | (16,089) |
|                                                                                                                |   | $                      | 27,909 | $ | 139,524 |
|  Earnings before tax                                                                                           |   | $                      | 558,365 | $ | 143,509 |
| Income tax (expense) recovery                                                                                       | 20     |                   | (8,337) |   | 9,872 |
|  Net earnings                                                                                                  |   | $                      | 550,028 | $ | 153,381 |
|                                                                                                                |   |                   |   |   |   |
| Basic earnings per share                                                                                            |   | $                      | 1.56 | $ | 0.45 |
| Diluted earnings per share                                                                                          |   | $                      | 1.55 | $ | 0.44 |
|  Weighted average number of shares outstanding                                                                 |   |                   |   |   |   |
| Basic                                                                                                               | 16     |                   | 353,249 |   | 344,288 |
| Diluted                                                                                                             | 16     |                   | 355,904 |   | 346,508 |
|  1) Equity settled stock based compensation (a non-cash item) included in general and administrative expenses. |   | $                      | 6,329 | $ | 7,732 |

|                                                      |   | Year Ended December 31 |
|-----------------------------------------------------------|--------|------------------------|
| (US dollars in thousands)                                 | Note   | 2011                   | 2010 |
|  Net earnings                                        |   | $                      | 550,028 | $ | 153,381 |
|  Other comprehensive income                          |   |                   |   |   |   |
| (Loss) gain on long-term investments - common shares held | 8      | $                      | (119,114) | $ | 146,343 |
| Deferred income tax recovery (expense)                    | 20     |                   | 10,699 |   | (14,422) |
|  Total other comprehensive (loss) income             |   | $                      | (108,415) | $ | 131,921 |
|  Total comprehensive income                          |   | $                      | 441,613 | $ | 285,302 |

----

|                                                  | Note   | December 31 | December 31 | January 1 |
|-------------------------------------------------------|--------|-------------|-------------|-----------|
| (US dollars in thousands)                             | 2011   | 2010        | 2010        |
|  Assets                                          |   |        |        |      |   |   |   |
| Current assets                                        |   |        |        |      |   |   |   |
| Cash and cash equivalents                             |   | $           | 840,201     | $         | 428,636 | $ | 227,566 |
| Accounts receivable                                   | 7      |        | 3,890       |      | 7,088 |   | 4,881 |
| Other                                                 |   |        | 1,221       |      | 727 |   | 1,027 |
| Total current assets                                  |   | $           | 845,312     | $         | 436,451 | $ | 233,474 |
|  Non-current assets                              |   |        |        |      |   |   |   |
| Silver and gold interests                             | 9      | $           | 1,871,726   | $         | 1,912,877 | $ | 1,928,476 |
| Long-term investments                                 | 8      |        | 151,621     |      | 284,448 |   | 73,747 |
| Deferred income taxes                                 | 20     |        | 2,301       |      | - |   | - |
| Other                                                 |   |        | 1,375       |      | 1,607 |   | 1,852 |
| Total non-current assets                              |   | $           | 2,027,023   | $         | 2,198,932 | $ | 2,004,075 |
|  Total assets                                    |   | $           | 2,872,335   | $         | 2,635,383 | $ | 2,237,549 |
|  Liabilities                                     |   |        |        |      |   |   |   |
| Current liabilities                                   |   |        |        |      |   |   |   |
| Accounts payable and accrued liabilities              |   | $           | 8,709       | $         | 9,843 | $ | 10,302 |
| Current portion of bank debt                          | 10     |        | 28,560      |      | 28,560 |   | 28,560 |
| Current portion of silver interest payments           | 11     |        | 130,789     |      | 133,243 |   | 130,788 |
| Total current liabilities                             |   | $           | 168,058     | $         | 171,646 | $ | 169,650 |
|  Non-current liabilities                         |   |        |        |      |   |   |   |
| Deferred income taxes                                 | 20     | $           | -           | $         | 822 | $ | - |
| Liability for Canadian dollar share purchase warrants | 12     |        | -           |      | - |   | 51,967 |
| Long-term portion of bank debt                        | 10     |        | 50,060      |      | 78,620 |   | 107,180 |
| Long-term portion of silver interest payments         | 11     |        | -           |      | 122,346 |   | 236,796 |
| Total non-current liabilities                         |   | $           | 50,060      | $         | 201,788 | $ | 395,943 |
|  Total liabilities                               |   | $           | 218,118     | $         | 373,434 | $ | 565,593 |
|  Shareholders' Equity                            |   |        |        |      |   |   |   |
| Issued capital                                        | 13     | $           | 1,793,772   | $         | 1,782,510 | $ | 1,476,480 |
| Reserves                                              | 14     |        | 25,422      |      | 135,364 |   | 4,611 |
| Retained earnings                                     |   |        | 835,023     |      | 344,075 |   | 190,865 |
| Total shareholders' equity                            |   | $           | 2,654,217   | $         | 2,261,949 | $ | 1,671,956 |
|  Total liabilities and shareholders' equity      |   | $           | 2,872,335   | $         | 2,635,383 | $ | 2,237,549 |
|  Commitments and contingencies                   | 10, 21 |        |        |      |   |   |   |

|                |   |   |            |   |   |   |   |   |   |
|---------------------|--------|--------|-----------------|--------|--------|--------|--------|--------|--------|
|                |   |   |            |   |   |   |   |   |   |
| /s/ Randy Smallwood |   |   | /s/ John Brough |   |   |   |   |
| Randy Smallwood     |   |   | John Brough     |   |   |
| Director            |   |   | Director        |   |   |   |   |

----

|                                                                            |   | Year Ended December 31 |
|---------------------------------------------------------------------------------|--------|------------------------|
| (US dollars in thousands)                                                       | Note   | 2011                   | 2010 |
|  Operating Activities                                                      |   |                   |   |   |   |
| Net earnings                                                                    |   | $                      | 550,028 | $ | 153,381 |
| Adjustments for                                                                 |   |                   |   |   |   |
| Depreciation and depletion                                                      |   |                   | 57,720 |   | 57,839 |
| Equity settled stock based compensation                                         |   |                   | 6,329 |   | 7,732 |
| Deferred income tax expense (recovery)                                          | 20     |                   | 7,575 |   | (10,248) |
| Loss on fair value adjustment of Canadian dollar share purchase warrants issued | 12     |                   | - |   | 133,210 |
| Loss (gain) on fair value adjustment of share purchase warrants held            | 8      |                   | 3,118 |   | (10,719) |
| Gain on disposal of silver purchase agreement                                   |   |                   | - |   | (5,911) |
| Investment income recognized in net earnings                                    |   |                   | (929) |   | (510) |
| Other                                                                           |   |                   | (84) |   | (3,514) |
| Change in non-cash operating working capital                                    | 17     |                   | 1,786 |   | (2,009) |
| Operating cash flows before interest income                                     |   | $                      | 625,543 | $ | 319,251 |
| Interest income received                                                        |   |                   | 884 |   | 475 |
|  Cash generated by operating activities                                    | $      | 626,427                | $ | 319,726 |
|  Financing Activities                                                      |   |                   |   |   |   |
| Bank debt repaid                                                                | 10     | $                      | (28,560) | $ | (28,560) |
| Share issue costs                                                               |   |                   | - |   | (85) |
| Share purchase warrants exercised                                               |   |                   | 99 |   | 76,093 |
| Share purchase options exercised                                                |   |                   | 7,839 |   | 32,335 |
| Dividends paid                                                                  | 13.2   |                   | (63,612) |   | - |
|  Cash (applied to) generated by financing activities                       | $      | (84,234)               | $ | 79,783 |
|  Investing Activities                                                      |   |                   |   |   |   |
| Silver and gold interests                                                       |   | $                      | (140,063) | $ | (170,661) |
| Silver and gold interests - interest paid                                       |   |                   | (1,260) |   | (1,739) |
| Acquisition of long-term investments                                            | 8      |                   | (13,674) |   | (54,107) |
| Dividend income received                                                        |   |                   | 45 |   | 35 |
| Proceeds on disposal of long-term investments                                   | 8      |                   | 24,270 |   | 469 |
| Proceeds on disposal of silver purchase agreement                               |   |                   | - |   | 25,000 |
| Other                                                                           |   |                   | (54) |   | (287) |
|  Cash applied to investing activities                                      | $      | (130,736)              | $ | (201,290) |
|  Effect of exchange rate changes on cash and cash equivalents              | $      | 108                    | $ | 2,851 |
| Increase in cash and cash equivalents                                           | $      | 411,565                | $ | 201,070 |
| Cash and cash equivalents, beginning of year                                    |   | 428,636                |   | 227,566 |
|  Cash and cash equivalents, end of year                                    | $      | 840,201                | $ | 428,636 |

----

|                                 |           |                            |                           |                           |       | Long-Term Investment Revaluation Reserve (Net of Tax) |              |    | Total  |
|--------------------------------------|----------------|---------------------------------|--------------------------------|--------------------------------|------------|-------------------------------------------------------|-------------------|---------|--------|
| (US dollars in thousands)            | Issued Capital | Share Purchase Warrants Reserve | Share Purchase Options Reserve | Restricted Share Units Reserve | SharePrice | Foreign Exchange                                      | Retained Earnings |
|  At January 1, 2010             | $              | 1,476,480                       | $                              | 7,414                          | $          | 12,387                                                | $                 | 814     | $      | (28,599) | $ | 12,595 | $ | 190,865 | $ | 1,671,956 |
| Total comprehensive income           |           |                            |                           |                           |       |                                                  |              |    |   |   |   |   |   |   |   |   |
| Net earnings                         | $              | -                               | $                              | -                              | $          | -                                                     | $                 | -       | $      | - | $ | - | $ | 153,381 | $ | 153,381 |
| Other comprehensive income           |           | -                               |                           | -                              |       | -                                                     |              | -       |   | 120,702 |   | 11,219 |   | - |   | 131,921 |
| Total comprehensive income           | $              | -                               | $                              | -                              | $          | -                                                     | $                 | -       | $      | 120,702 | $ | 11,219 | $ | 153,381 | $ | 285,302 |
| Fair value of SBC 1                  | $              | -                               | $                              | -                              | $          | 5,977                                                 | $                 | 1,755   | $      | - | $ | - | $ | - | $ | 7,732 |
| Options 1 exercised                  |           | 40,846                          |                           | -                              |       | (8,511)                                               |              | -       |   | - |   | - |   | - |   | 32,335 |
| RSUs 1 released                      |           | 617                             |                           | -                              |       | -                                                     |              | (617)   |   | - |   | - |   | - |   | - |
| Warrants 1 exercised                 |           | 261,215                         |                           | -                              |       | -                                                     |              | -       |   | - |   | - |   | - |   | 261,215 |
| Warrants 1 expired                   |           | -                               |                           | 57                             |       | -                                                     |              | -       |   | - |   | - |   | - |   | 57 |
| Realized loss on disposal of LTI's 1 |           | -                               |                           | -                              |       | -                                                     |              | -       |   | 219 |   | (48) |   | (171) |   | - |
| DIT 1 recovery                       |           | 3,352                           |                           | -                              |       | -                                                     |              | -       |   | - |   | - |   | - |   | 3,352 |
| At December 31, 2010                 | $              | 1,782,510                       | $                              | 7,471                          | $          | 9,853                                                 | $                 | 1,952   | $      | 92,322 | $ | 23,766 | $ | 344,075 | $ | 2,261,949 |
| Total comprehensive income           |           |                            |                           |                           |       |                                                  |              |    |   |   |   |   |   |   |   |   |
| Net earnings                         | $              | -                               | $                              | -                              | $          | -                                                     | $                 | -       | $      | - | $ | - | $ | 550,028 | $ | 550,028 |
| Other comprehensive loss             |           | -                               |                           | -                              |       | -                                                     |              | -       |   | (108,263) |   | (152) |   | - |   | (108,415) |
| Total comprehensive income           | $              | -                               | $                              | -                              | $          | -                                                     | $                 | -       | $      | (108,263) | $ | (152) | $ | 550,028 | $ | 441,613 |
| Fair value of SBC 1                  | $              | -                               | $                              | -                              | $          | 4,674                                                 | $                 | 1,655   | $      | - | $ | - | $ | - | $ | 6,329 |
| Options 1 exercised                  |           | 10,052                          |                           | -                              |       | (2,213)                                               |              | -       |   | - |   | - |   | - |   | 7,839 |
| RSUs 1 released                      |           | 1,097                           |                           | -                              |       | -                                                     |              | (1,097) |   | - |   | - |   | - |   | - |
| Warrants 1 exercised                 |           | 113                             |                           | (14)                           |       | -                                                     |              | -       |   | - |   | - |   | - |   | 99 |
| Realized gain on disposal of LTI's 1 |           | -                               |                           | -                              |       | -                                                     |              | -       |   | (2,695) |   | (1,837) |   | 4,532 |   | - |
| Dividends paid 2                     |           | -                               |                           | -                              |       | -                                                     |              | -       |   | - |   | - |   | (63,612) |   | (63,612) |
|  At December 31, 2011           | $              | 1,793,772                       | $                              | 7,457                          | $          | 12,314                                                | $                 | 2,510   | $      | (18,636) | $ | 21,777 | $ | 835,023 | $ | 2,654,217 |

| 1)   | Definitions as follows: “SBC” = Equity Settled Stock Based Compensation; “Options” = Share Purchase Options; “RSUs” = Restricted Share Units; “Warrants” = Share Purchase Warrants; “LTI’s” = Long-Term Investments in Common Shares Held; “DIT recovery” = Deferred Income Tax recovery related to share issue costs. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2)   | Total cash dividends of $0.18 per common share were paid during the year ended December 31, 2011. |
|----------------|---------------------------------------------------------------------------------------------------|

----

----

----

| ·   | For financial assets that are classified as FVTNE, the foreign exchange component is recognized as a component of net earnings, and |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------|

| ·   | For financial assets that are classified as FVTOCI, the foreign exchange component is recognized as a component of OCI. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------|

----

| ·   | For financial liabilities that are denominated in a foreign currency and are measured at amortized cost at the end of each reporting period, the foreign exchange gains and losses are determined based on the amortized cost of the instruments and are recognized as a component of net earnings, and |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | For financial liabilities that are measured as at FVTNE, the foreign exchange component forms part of the fair value gains or losses and is recognized as a component of net earnings. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

| ·   | IFRS 7 – Financial Instruments (amended 2010) |
|--------------------|-----------------------------------------------------|

----

| ·   | IAS 12 – Income Taxes (amended 2010) |
|--------------------|--------------------------------------------|

| ·   | IAS 1 - Presentation of Financial Statements (amended 2011) |
|--------------------|-------------------------------------------------------------|

| ·   | IFRS 9 (2010) – Financial Instruments (amended 2010) |
|--------------------|------------------------------------------------------------|

| ·   | IFRS 10 - Consolidated Financial Statements (“IFRS 10”) |
|--------------------|--------------------------------------------------------------------------|

| ·   | IFRS 11 - Joint Arrangements (“IFRS 11”) |
|--------------------|-----------------------------------------------------------|

| ·   | IFRS 12 - Disclosure of Interests in Other Entities (“IFRS 12”) |
|--------------------|----------------------------------------------------------------------------------|

| ·   | IFRS 13 - Fair Value Measurement |
|--------------------|---------------------------------------|

| ·   | IAS 19 – Employee Benefits (amended 2011) |
|--------------------|-------------------------------------------------|

| ·   | IAS 27 - Separate Financial Statements (amended 2011) (“IAS 27”) |
|--------------------|------------------------------------------------------------------------------|

| ·   | IAS 28 - Investments in Associates (amended 2011) (“IAS 28”) |
|--------------------|-------------------------------------------------------------------------------|

| ·   | IFRIC 20 - Stripping Costs in the Production Phase of a Surface Mine |
|--------------------|----------------------------------------------------------------------|

----

----

|                                                                                                              | Note   | December 31 | December 31 | January 1 |
|-------------------------------------------------------------------------------------------------------------------|--------|-------------|-------------|-----------|
| (US dollars in thousands)                                                                                         | 2011   | 2010        | 2010        |
|  Financial Assets                                                                                            |   |        |        |      |   |   |   |
| Fair value through net earnings                                                                                   |   |        |        |      |   |   |   |
| Cash and cash equivalents                                                                                         |   | $           | 840,201     | $         | 428,636 | $ | 227,566 |
| Long-term investments - warrants held                                                                             | 8      |        | 2,582       |      | 5,700 |   | 1,245 |
| Trade receivables from provisional concentrate sales, net of fair value adjustment                                | 7      |        | 3,494       |      | 6,665 |   | 3,367 |
| Fair value through other comprehensive income                                                                     |   |        |        |      |   |   |   |
| Long-term investments - common shares held                                                                        | 8      |        | 149,039     |      | 278,748 |   | 72,502 |
| Amortized cost                                                                                                    |   |        |        |      |   |   |   |
| Other receivables                                                                                                 |   |        | 396         |      | 423 |   | 1,514 |
|                                                                                                         |   | $           | 995,712     | $         | 720,172 | $ | 306,194 |
|  Financial Liabilities                                                                                       |   |        |        |      |   |   |   |
| Fair value through net earnings                                                                                   |   |        |        |      |   |   |   |
| Liability for Canadian dollar share purchase warrants issued                                                      | 12     | $           | -           | $         | - | $ | 51,967 |
| Accrued liabilities from provisional concentrate sales related to fair value adjustment, net of trade receivables | 7      |        | 1,567       |      | - |   | - |
| Amortized cost                                                                                                    |   |        |        |      |   |   |   |
| Accounts payable and accrued liabilities                                                                          |   |        | 6,688       |      | 9,843 |   | 10,302 |
| Bank debt                                                                                                         | 10     |        | 78,620      |      | 107,180 |   | 135,740 |
| Silver interest payments                                                                                          | 11     |        | 130,789     |      | 255,589 |   | 367,584 |
|                                                                                                         |   | $           | 217,664     | $         | 372,612 | $ | 565,593 |

----

|                                                                               |   | December 31 | December 31 | January 1 |
|------------------------------------------------------------------------------------|--------|-------------|-------------|-----------|
| (in thousands)                                                                     | Note   | 2011        | 2010        | 2010      |
|  Cash and cash equivalents                                                    |   | $           | 840,201     | $         | 428,636 | $ | 227,566 |
| Trade receivables from provisional concentrate sales, net of fair value adjustment | 7      |        | 3,494       |      | 6,665 |   | 3,367 |
| Other receivables                                                                  |   |        | 396         |      | 423 |   | 1,514 |
|                                                                          |   | $           | 844,091     | $         | 435,724 | $ | 232,447 |

----

| As at December 31, 2011                                                                                           |
|-------------------------------------------------------------------------------------------------------------------|
| (in thousands)                                                                                                    | 2012 | 2013 | 2014 | 2015 | 2016 | Thereafter | Commitments | Total |
|  Non-derivative financial liabilities                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Bank debt                                                                                                         | $ | 28,560 | $ | 28,560 | $ | 21,500 | $ | - | $ | - | $ | - | $ | - | $ | 78,620 |
| Interest on bank debt 1                                                                                           |   | 1,006 |   | 618 |   | 174 |   | - |   | - |   | - |   | - |   | 1,798 |
| Silver interest payments                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Barrick                                                                                                           |   | 137,500 |   | - |   | - |   | - |   | - |   | - |   | - |   | 137,500 |
| Rosemont 2                                                                                                        |   | - |   | - |   | - |   | - |   | - |   | - |   | 230,000 |   | 230,000 |
| Loma de La Plata 3                                                                                                |   | - |   | - |   | - |   | - |   | - |   | - |   | 32,400 |   | 32,400 |
| Accounts payable and accrued liabilities                                                                          |   | 6,324 |   | - |   | 364 |   | - |   | - |   | - |   | - |   | 6,688 |
|  Derivative financial liabilities                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Accrued liabilities from provisional concentrate sales related to fair value adjustment, net of trade receivables |   | 1,567 |   | - |   | - |   | - |   | - |   | - |   | - |   | 1,567 |
|  Total                                                                                                       | $ | 174,957 | $ | 29,178 | $ | 22,038 | $ | - | $ | - | $ | - | $ | 262,400 | $ | 488,573 |

| 1)   | As the applicable interest rates are floating in nature, the interest charges are estimated based on market-based forward interest rate curves at the end of the reporting period. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2)   | In connection with the Rosemont precious metal purchase agreement, the Company is committed to pay Augusta total upfront cash payments of $230 million, payable on an installment basis to partially fund construction of the Rosemont mine once certain milestones are achieved, including the receipt of key permits and securing the necessary financing to complete construction of the mine. |
|----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3)   | In connection with the Company’s election to convert the debenture with Pan American into a silver purchase agreement, the Company is committed to pay Pan American total upfront cash payments of $32.4 million following the satisfaction of certain conditions, including Pan American receiving all necessary permits to proceed with the mine construction. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| As at December 31, 2010                    |
|--------------------------------------------|
| (in thousands)                             | 2011 | 2012 | 2013 | 2014 | 2015 | Thereafter | Commitments | Total |
|  Non-derivative financial liabilities |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Bank debt                                  | $ | 28,560 | $ | 28,560 | $ | 28,560 | $ | 21,500 | $ | - | $ | - | $ | - | $ | 107,180 |
| Interest on bank debt 1                    |   | 1,158 |   | 817 |   | 472 |   | 129 |   | - |   | - |   | - |   | 2,576 |
| Silver interest payments                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Barrick                                    |   | 137,500 |   | 137,500 |   | - |   | - |   | - |   | - |   | - |   | 275,000 |
| Rosemont 2                                 |   | - |   | - |   | - |   | - |   | - |   | - |   | 230,000 |   | 230,000 |
| Loma de La Plata 3                         |   | - |   | - |   | - |   | - |   | - |   | - |   | 32,400 |   | 32,400 |
| Accounts payable and accrued liabilities   |   | 9,843 |   | - |   | - |   | - |   | - |   | - |   | - |   | 9,843 |
|  Total                                | $ | 177,061 | $ | 166,877 | $ | 29,032 | $ | 21,629 | $ | - | $ | - | $ | 262,400 | $ | 656,999 |

| 1)   | As the applicable interest rates are floating in nature, the interest charges are estimated based on market-based forward interest rate curves at the end of the reporting period. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2)   | In connection with the Rosemont precious metal purchase agreement, the Company is committed to pay Augusta total upfront cash payments of $230 million, payable on an installment basis to partially fund construction of the Rosemont mine once certain milestones are achieved, including the receipt of key permits and securing the necessary financing to complete construction of the mine. |
|----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3)   | In connection with the Company’s election to convert the debenture with Pan American into a silver purchase agreement, the Company is committed to pay Pan American total upfront cash payments of $32.4 million following the satisfaction of certain conditions, including Pan American receiving all necessary permits to proceed with the mine construction. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                       |   | December 31 |    | December 31 |   | January 1 |
|--------------------------------------------|--------|-------------|---------|-------------|--------|-----------|
| (US dollars in thousands)                  |   | 2011        |    | 2010        |   | 2010      |
|  Monetary Assets                      |   |        |    |        |   |      |   |   |   |
| Cash and cash equivalents                  |   | $           | 690     |        | $      | 42,505    |   | $ | 6,015 |
| Accounts receivable                        |   |        | 115     |        |   | 183       |   |   | 310 |
| Long-term investments - common shares held |   |        | 144,039 |        |   | 278,748   |   |   | 72,502 |
| Long-term investments - warrants held      |   |        | 2,582   |        |   | 5,700     |   |   | 1,245 |
|                                  |   | $           | 147,426 |        | $      | 327,136   |   | $ | 80,072 |
|  Monetary Liabilities                 |   |        |    |        |   |      |   |   |   |
| Accounts payable and accrued liabilities   |   | $           | 3,455   |        | $      | 4,294     |   | $ | 3,102 |

|                                                    | As at December 31, 2011             |
|---------------------------------------------------------|-------------------------------------|
| (in thousands)                                          | 10% Increase in the Canadian Dollar | 10% Decrease in the Canadian Dollar |
|  Increase (decrease) in net earnings               | $                                   | (7) | $ | 7 |
| Increase (decrease) in other comprehensive income       |                                | 14,404 |   | (14,404) |
|  Increase (decrease) in total comprehensive income | $                                   | 14,397 | $ | (14,397) |

|                                                    | As at December 31, 2010             |
|---------------------------------------------------------|-------------------------------------|
| (in thousands)                                          | 10% Increase in the Canadian Dollar | 10% Decrease in the Canadian Dollar |
|  Increase (decrease) in net earnings               | $                                   | 4,409 | $ | (4,409) |
| Increase (decrease) in other comprehensive income       |                                | 27,875 |   | (27,875) |
|  Increase (decrease) in total comprehensive income | $                                   | 32,284 | $ | (32,284) |

----

| ·   | Net earnings for the year ended December 31, 2011 would have increased/decreased by approximately $0.3 million (2010 - $0.6 million) as a result of changes in the fair value of share purchase warrants held; and |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Other comprehensive income for the year ended December 31, 2011 would have increased/decreased by approximately $14.9 million (2010 - $27.9 million) as a result of changes in the fair value of common shares held. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                                                                             | December 31, 2011 |
|------------------------------------------------------------------------------------------------------------------|-------------------|
| (in thousands)                                                                                                   | Total             |  Quoted prices in active markets for identical assets (Level 1) | Significant other observable inputs (Level 2) | Unobservable inputs(Level 3) |
|  Cash and cash equivalents                                                                                  | $                 | 840,201 | $ | 840,201 | $ | - | $ | - |
| Trade receivable from provisional concentrate sales, net of fair value adjustment                                |              | 3,494 |   | - |   | 3,494 |   | - |
| Accrued liabilities from provisional concentrate sales related to fair value adjustment, net of trade receivable |              | (1,567) |   | - |   | (1,567) |   | - |
| Long-term investments - common shares held                                                                       |              | 149,039 |   | 149,039 |   | - |   | - |
| Long-term investments - warrants held                                                                            |              | 2,582 |   | - |   | 2,582 |   | - |
|                                                                                                        | $                 | 993,749 | $ | 989,240 | $ | 4,509 | $ | - |

|                                                                              | December 31, 2010 |
|-----------------------------------------------------------------------------------|-------------------|
| (in thousands)                                                                    | Total             |  Quoted prices in active markets for identical assets (Level 1) | Significant other observable inputs (Level 2) | Unobservable inputs(Level 3) |
|  Cash and cash equivalents                                                   | $                 | 428,636 | $ | 428,636 | $ | - | $ | - |
| Trade receivable from provisional concentrate sales, net of fair value adjustment |              | 6,665 |   | - |   | 6,665 |   | - |
| Long-term investments - common shares held                                        |              | 278,748 |   | 278,748 |   | - |   | - |
| Long-term investments - warrants held                                             |              | 5,700 |   | - |   | 5,700 |   | - |
|                                                                         | $                 | 719,749 | $ | 707,384 | $ | 12,365 | $ | - |

----

|                      | Year ended December 31 |
|---------------------------|------------------------|
| (in thousands)            | 2011                   | 2010 |
|  Sales               |                   |   |   |   |
| Silver Bullion Sales      |                   |   |   |   |
| Silver credit sales       | $                      | 552,122 | $ | 293,815 |
| Concentrate sales         |                   | 148,507 |   | 97,845 |
|                      | $                      | 700,629 | $ | 391,660 |
| Gold Bullion Sales        |                   |   |   |   |
| Concentrate sales         |                   | 29,368 |   | 31,693 |
|  Total sales revenue | $                      | 729,997 | $ | 423,353 |

|                                                         |   | Year Ended December 31 |
|--------------------------------------------------------------|--------|------------------------|
| (in thousands)                                               |   | 2011                   |   | 2010 |
|  Salaries and benefits                                  |   | $                      | 7,911 |   | $ | 7,221 |
| Equity settled stock based compensation (a non-cash expense) |   |                   | 6,329 |   |   | 7,732 |
| Depreciation                                                 |   |                   | 261 |   |   | 269 |
| Other                                                        |   |                   | 10,679 |   |   | 9,447 |
|  Total general and administrative                       |   | $                      | 25,180 |   | $ | 24,669 |

----

|                                                                                     | December 31 | December 31 | January 1 |
|------------------------------------------------------------------------------------------|-------------|-------------|-----------|
| (in thousands)                                                                           | 2011        | 2010        | 2010      |
|  Trade receivables from provisional concentrate sales, net of fair value adjustment | $           | 3,494       | $         | 6,665 | $ | 3,367 |
| Other receivables                                                                        |        | 396         |      | 423 |   | 1,514 |
|  Total accounts receivable                                                          | $           | 3,890       | $         | 7,088 | $ | 4,881 |

|                     | December 31 | December 31 |    | January 1 |
|--------------------------|-------------|-------------|---------|-----------|
| (in thousands)           | 2011        | 2010        | 2010    |
|  Common shares held |        | $           | 149,039 |      | $ | 278,748 |   | $ | 72,502 |
| Warrants held            |        |        | 2,582   |      |   | 5,700 |   |   | 1,245 |
|                |        | $           | 151,621 |      | $ | 284,448 |   | $ | 73,747 |

----

|             | December 31, 2011 |
|------------------|-------------------|
| (in thousands)   | Fair Value        |  Fair Value Adjustment Losses Included in OCI | Realized Gain on Disposal |
|  Bear Creek |              | $ | 46,171 |   | $ | (80,524) |   | $ | - |
| Revett           |              |   | 23,793 |   |   | (1,043) |   |   | - |
| Sabina           |              |   | 44,177 |   |   | (21,817) |   |   | - |
| Other            |              |   | 34,898 |   |   | (15,730) |   |   | 4,532 |
|        |              | $ | 149,039 |   | $ | (119,114) |   | $ | 4,532 |

|             | December 31, 2010 | January 1, 2010                                   |
|------------------|-------------------|---------------------------------------------------|
| (in thousands)   | Fair Value        |  Fair Value Adjustment Gains Included in OCI | Realized Loss on Disposal | Fair Value |
|  Bear Creek | $                 | 126,695                                           |   | $ | 69,578 |   | $ | - |   | $ | 38,232 |
| Revett           |              | 24,836                                            |   |   | 16,682 |   |   | - |   |   | 5,815 |
| Sabina           |              | 65,993                                            |   |   | 39,827 |   |   | - |   |   | 9,241 |
| Other            |              | 61,224                                            |   |   | 20,256 |   |   | (171) |   |   | 19,214 |
|        | $                 | 278,748                                           |   | $ | 146,343 |   | $ | (171) |   | $ | 72,502 |

|           | December 31, 2011 |
|----------------|-------------------|
| (in thousands) |              | Fair Value |  Fair Value Adjustment Losses Included in Net Earnings | Realized Loss on Disposal |
|  Revett   |              | $ | 741 |   | $ | (55) |   | $ | - |
| Other          |              |   | 1,841 |   |   | (3,063) |   |   | (16) |
|      |              | $ | 2,582 |   | $ | (3,118) |   | $ | (16) |

----

|           | December 31, 2010 | January 1, 2010                                            |
|----------------|-------------------|------------------------------------------------------------|
| (in thousands) | Fair Value        |  Fair Value Adjustment Gains Included in Net Earnings | Fair Value |
|  Revett   | $                 | 796                                                        |   | $ | 948 |   | $ | 282 |
| Sabina         |              | -                                                          |   |   | 6,368 |   |   | 75 |
| Other          |              | 4,904                                                      |   |   | 3,403 |   |   | 888 |
|      | $                 | 5,700                                                      |   | $ | 10,719 |   | $ | 1,245 |

----

|                   | December 31, 2011    |
|------------------------|----------------------|
|                   | Cost                 | Accumulated Depletion | Carrying Amount -Dec 31, 2011 |
| (in thousands)         | Balance -Jan 1, 2011 | Additions | Balance -Dec 31, 2011 | Balance -Jan 1, 2011 | Depletion | Balance -Dec 31, 2011 |
|  Silver interests |                 |   |   |   |   |   |   |   |   |   |   |   |   |
| San Dimas              | $                    | 190,331 | $ | - | $ | 190,331 | $ | (18,807) | $ | (3,997) | $ | (22,804) | $ | 167,527 |
| Zinkgruvan             |                 | 77,919 |   | - |   | 77,919 |   | (17,797) |   | (2,483) |   | (20,280) |   | 57,639 |
| Yauliyacu              |                 | 285,292 |   | - |   | 285,292 |   | (48,972) |   | (6,308) |   | (55,280) |   | 230,012 |
| Peñasquito        |                 | 524,626 |   | - |   | 524,626 |   | (9,696) |   | (9,957) |   | (19,653) |   | 504,973 |
| Cozamin                |                 | 41,959 |   | - |   | 41,959 |   | (11,010) |   | (5,834) |   | (16,844) |   | 25,115 |
| Barrick 1              |                 | 607,612 |   | 16,197 |   | 623,809 |   | (12,305) |   | (10,419) |   | (22,724) |   | 601,085 |
| Other 2                |                 | 294,258 |   | 109 |   | 294,367 |   | (27,280) |   | (15,371) |   | (42,651) |   | 251,716 |
|                   | $                    | 2,021,997 | $ | 16,306 | $ | 2,038,303 | $ | (145,867) | $ | (54,369) | $ | (200,236) | $ | 1,838,067 |
|  Gold interests   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Minto                  | $                    | 47,774 | $ | - | $ | 47,774 | $ | (11,027) | $ | (3,088) | $ | (14,115) | $ | 33,659 |
|              | $                    | 2,069,771 | $ | 16,306 | $ | 2,086,077 | $ | (156,894) | $ | (57,457) | $ | (214,351) | $ | 1,871,726 |

| 1)   | Comprised of the Pascua-Lama, Lagunas Norte, Pierina and Veladero silver interests. |
|----------------|-------------------------------------------------------------------------------------|

| 2)   | Comprised of the Los Filos, Keno Hill, Mineral Park, Neves-Corvo, Stratoni, Campo Morado, Minto, Aljustrel, Rosemont and Loma de La Plata silver interests. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                   | December 31, 2010    |
|------------------------|----------------------|
|                   | Cost                 | Accumulated Depletion | Carrying Amount -Dec 31, 2010 |
| (in thousands)         | Balance -Jan 1, 2010 | Additions | Disposals | Balance -Dec 31, 2010 | Balance -Jan 1, 2010 | Depletion | Disposals | Balance -Dec 31, 2010 |
|  Silver interests |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| San Dimas              | $                    | 190,331 | $ | - | $ | - | $ | 190,331 | $ | (14,900) | $ | (3,907) | $ | - | $ | (18,807) | $ | 171,524 |
| Zinkgruvan             |                 | 77,919 |   | - |   | - |   | 77,919 |   | (14,599) |   | (3,198) |   | - |   | (17,797) |   | 60,122 |
| Yauliyacu              |                 | 285,292 |   | - |   | - |   | 285,292 |   | (43,227) |   | (5,745) |   | - |   | (48,972) |   | 236,320 |
| Peñasquito        |                 | 524,365 |   | 261 |   | - |   | 524,626 |   | (2,217) |   | (7,479) |   | - |   | (9,696) |   | 514,930 |
| Cozamin                |                 | 41,959 |   | - |   | - |   | 41,959 |   | (4,497) |   | (6,513) |   | - |   | (11,010) |   | 30,949 |
| Barrick 1              |                 | 583,485 |   | 24,127 |   | - |   | 607,612 |   | (3,339) |   | (8,966) |   | - |   | (12,305) |   | 595,307 |
| Other 2                |                 | 284,266 |   | 35,470 |   | (25,478) |   | 294,258 |   | (18,717) |   | (15,686) |   | 7,123 |   | (27,280) |   | 266,978 |
|                   | $                    | 1,987,617 | $ | 59,858 | $ | (25,478) | $ | 2,021,997 | $ | (101,496) | $ | (51,494) | $ | 7,123 | $ | (145,867) | $ | 1,876,130 |
|  Gold interests   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Minto                  | $                    | 47,283 | $ | 491 | $ | - | $ | 47,774 | $ | (4,928) | $ | (6,099) | $ | - | $ | (11,027) | $ | 36,747 |
|              | $                    | 2,034,900 | $ | 60,349 | $ | (25,478) | $ | 2,069,771 | $ | (106,424) | $ | (57,593) | $ | 7,123 | $ | (156,894) | $ | 1,912,877 |

| 1)   | Comprised of the Pascua-Lama, Lagunas Norte, Pierina and Veladero silver interests. |
|----------------|-------------------------------------------------------------------------------------|

| 2)   | Comprised of the Los Filos, Keno Hill, Mineral Park, Neves-Corvo, Stratoni, Campo Morado, Minto, Aljustrel, Rosemont and Loma de La Plata silver interests in addition to the previously owned La Negra silver interest. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                   | December 31, 2011 | December 31, 2010 |
|------------------------|-------------------|-------------------|
| (in thousands)         | Depletable        | Non-Depletable    | Total | Depletable | Non-Depletable | Total |
|  Silver interests |              |              |   |   |   |   |   |   |   |   |   |   |
| San Dimas              | $                 | 41,719            | $ | 125,808 | $ | 167,527 | $ | 40,539 | $ | 130,985 | $ | 171,524 |
| Zinkgruvan             |              | 37,118            |   | 20,521 |   | 57,639 |   | 39,600 |   | 20,522 |   | 60,122 |
| Yauliyacu              |              | 38,368            |   | 191,644 |   | 230,012 |   | 9,386 |   | 226,934 |   | 236,320 |
| Peñasquito        |              | 411,124           |   | 93,849 |   | 504,973 |   | 398,632 |   | 116,298 |   | 514,930 |
| Cozamin                |              | 25,115            |   | - |   | 25,115 |   | 30,949 |   | - |   | 30,949 |
| Barrick 1, 2           |              | 24,185            |   | 576,900 |   | 601,085 |   | 34,616 |   | 560,691 |   | 595,307 |
| Other 3                |              | 104,705           |   | 147,011 |   | 251,716 |   | 115,368 |   | 151,610 |   | 266,978 |
|                   | $                 | 682,334           | $ | 1,155,733 | $ | 1,838,067 | $ | 669,090 | $ | 1,207,040 | $ | 1,876,130 |
|  Gold interests   |              |              |   |   |   |   |   |   |   |   |   |   |
| Minto                  | $                 | 25,354            | $ | 8,305 | $ | 33,659 | $ | 26,673 | $ | 10,074 | $ | 36,747 |
|              | $                 | 707,688           | $ | 1,164,038 | $ | 1,871,726 | $ | 695,763 | $ | 1,217,114 | $ | 1,912,877 |

| 1)   | Comprised of the Pascua-Lama, Lagunas Norte, Pierina and Veladero silver interests. |
|----------------|-------------------------------------------------------------------------------------|

| 2)   | The amount reflected as depletable is based on the value of the reserves relating to the Lagunas Norte, Pierina and Veladero silver interests. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------|

| 3)   | Comprised of the Los Filos, Keno Hill, Mineral Park, Neves-Corvo, Stratoni, Campo Morado, Minto, Rosemont, Aljustrel and Loma de La Plata silver interests. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                 | December 31, 2011 |
|--------------------------------------|-------------------|
| (in thousands)                       | Term Loan         | Revolving Loan | Total |
|                                 |              |   |   |   |   |   |
| Current portion                      | $                 | 28,560 | $ |  - | $ | 28,560 |
| Long-term portion                    |              | 50,060 |   |  - |   | 50,060 |
|                            | $                 | 78,620 | $ |  - | $ | 78,620 |
|                                 |              |   |   |   |   |   |
| Interest capitalized during the year | $                 | 1,044 | $ |  - | $ | 1,044 |
| Effective interest rate              |              | 1.13% |   | 0.00% |   | 1.13% |

|                                 | December 31, 2010 |
|--------------------------------------|-------------------|
| (in thousands)                       | Term Loan         | Revolving Loan | Total |
|                                 |              |   |   |   |   |   |
| Current portion                      | $                 | 28,560 | $ |  - | $ | 28,560 |
| Long-term portion                    |              | 78,620 |   |  - |   | 78,620 |
|                            | $                 | 107,180 | $ |  - | $ | 107,180 |
|                                 |              |   |   |   |   |   |
| Interest capitalized during the year | $                 | 1,420 | $ |  - | $ | 1,420 |
| Effective interest rate              |              | 1.16% |   | 0.00% |   | 1.16% |

----

|              | January 1, 2010 |
|-------------------|-----------------|
| (in thousands)    | Term Loan       | Revolving Loan | Total |
|              |            |   |   |   |   |   |
| Current portion   | $               | 28,560 | $ |  - | $ | 28,560 |
| Long-term portion |            | 107,180 |   |  - |   | 107,180 |
|         | $               | 135,740 | $ |  - | $ | 135,740 |
|              |            |   |   |   |   |   |

| Fiscal Year  | Term Loan (000's) | Revolving Loan(000's) | Total(000's) |
|--------------|------------------------|-----------------------|--------------|
|         |                   |                  |         |   |   |   |
| 2012         | $                      | 28,560                | $            | - | $ | 28,560 |
| 2013         |                   | 28,560                |         | - |   | 28,560 |
| 2014         |                   | 21,500                |         | - |   | 21,500 |
|    | $                      | 78,620                | $            | - | $ | 78,620 |

----

| (In thousands, except number of warrants and per warrant amounts) |                |                                 |                 |                 |                                                                                                                |                                                                                      |                                    |
|-------------------------------------------------------------------|---------------------|--------------------------------------|----------------------|----------------------|---------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------|-----------------------------------------|
|                                                              |                |                                 |                 |                 |                                                                                                                |
|                                                              | WarrantsOutstanding | WeightedAverage ExercisePrice (Cdn$) | Unit FairMarketValue |  TotalLiability | Gain (Loss) On Fair ValueAdjustment                                                                                 |
|                                                              |                |                                 |                 |                 |                                                                                                                |                                                                                      |                                    |   |
| At January 1, 2010                                                |                | 7,780,900                            | $10.00               | $6.68                |   $                                                                                                            |          51,967                              |   $                                |                    - |
| Exercised                                                         |                | (7,737,970)                          | 10.00                | 23.93                |                                                                                                                |          (51,680)                            |                                    | (133,497) |
| Expired                                                           |                | (42,930)                             | 10.00                | 6.68                 |                                                                                                                |               (287) |                                    | 287 |
|  At December 31, 2010                                        | -                   | n/a                                  | $0.00                | $                    |                    - | $                                                                                         |      (133,210) |

|                                                                                                                                        | Note   | December 31 | December 31 | January 1 |
|---------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------|-------------|-----------|
| (US dollars in thousands)                                                                                                                   | 2011   | 2010        | 2010        |
|  Issued Capital                                                                                                                        |   |        |        |      |   |   |   |
| Share capital issued and outstanding: 353,499,816 (December 31, 2010:  352,785,382; January 1, 2010:  342,186,624) | 13.1   | $           | 1,793,772   | $         | 1,782,510 | $ | 1,476,480 |

|                              |   | Number ofShares | Weighted Average Price (Cdn$) |
|-----------------------------------|--------|-----------------|-------------------------------|
|                              |   |            |                          |
| At January 1, 2010                |   | 342,186,624     |                          |
| Share purchase options exercised  |   | 2,813,773       | $11.85                        |
| Share purchase warrants exercised |   | 7,738,030       | 10.00                         |
| Restricted share units released   |   | 46,955          | -                             |
| At December 31, 2010              |   | 352,785,382     |                          |
| Share purchase options exercised  |   | 642,173         | $11.96                        |
| Share purchase warrants exercised |   | 4,968           | 20.00                         |
| Restricted share units released   |   | 67,293          | -                             |
|  At December 31, 2011        |   | 353,499,816     |                          |

----

|                                                 | Note   | December 31 | December 31 | January 1 |
|------------------------------------------------------|--------|-------------|-------------|-----------|
| (US dollars in thousands)                            | 2011   | 2010        | 2010        |
|  Reserves                                       |   |        |        |      |   |   |   |
| Share purchase options                               | 14.1   | $           | 12,314      | $         | 9,853 | $ | 12,387 |
| Restricted share units                               | 14.2   |        | 2,510       |      | 1,952 |   | 814 |
| Share purchase warrants                              | 14.3   |        | 7,457       |      | 7,471 |   | 7,414 |
| Long-term investment revaluation reserve, net of tax | 8      |        | 3,141       |      | 116,088 |   | (16,004) |
|  Total Reserves                                 |   | $           | 25,422      | $         | 135,364 | $ | 4,611 |

| 14.1.   | Share Purchase Options |
|-------------------|------------------------|

|                                                 | Year Ended December 31 |
|------------------------------------------------------|------------------------|
|                                                 | 2011                   | 2010 |
|  Black-Scholes weighted average assumptions     |                   |   |
| Grant date share price and exercise price            | Cdn$37.37              | Cdn$15.89 |
| Expected dividend yield                              | 0.49%                  | 0.00% |
| Expected volatility                                  | 48%                    | 55% |
| Risk-free interest rate                              | 1.67%                  | 1.84% |
| Estimated forfeiture rate                            | 0.0%                   | 0.0% |
| Expected option life, in years                       | 2.5                    | 2.5 |
|  Weighted average fair value per option granted | Cdn$11.28              | Cdn$5.54 |

----

|                                                        | Number of OptionsOutstanding | Weighted Average Exercise Price (Cdn$) |
|-------------------------------------------------------------|------------------------------|----------------------------------------|
|  At January 1, 2010                                    | 4,137,228                    | $11.90                                 |
| Granted (fair value - $6.9 million or Cdn$5.54 per option)  | 1,288,700                    | 15.89                                  |
| Exercised                                                   | (2,813,773)                  | 11.85                                  |
| Forfeited                                                   | (8,333)                      | 9.08                                   |
| At December 31, 2010                                        | 2,603,822                    | $13.91                                 |
| Granted (fair value - $7.2 million or Cdn$11.28 per option) | 626,000                      | 37.37                                  |
| Exercised                                                   | (642,173)                    | 11.96                                  |
| Forfeited                                                   | (26,522)                     | 25.23                                  |
|  At December 31, 2011                                  | 2,561,127                    | $19.60                                 |

| Exercise Price(Cdn$) | Exercisable Options | Non-Exercisable Options | Total Options Outstanding | Weighted Average Remaining Contractual Life |
|----------------------|---------------------|-------------------------|---------------------------|---------------------------------------------|
|  $9.08          | 310,665             | -                       | 310,665                   | 2.1 years                                   |
| $12.60               | 250,000             | -                       | 250,000                   | 0.1 years                                   |
| $12.97               | 18,500              | -                       | 18,500                    | 1.3 years                                   |
| $15.88               | 1                   | 33,333                  | 33,334                    | 3.0 years                                   |
| $15.89               | 548,201             | 347,561                 | 895,762                   | 3.2 years                                   |
| $15.95               | 23,333              | 33,333                  | 56,666                    | 3.2 years                                   |
| $16.63               | 380,000             | -                       | 380,000                   | 1.2 years                                   |
| $29.50               | -                   | 100,000                 | 100,000                   | 5.0 years                                   |
| $33.03               | -                   | 10,000                  | 10,000                    | 4.4 years                                   |
| $33.56               | -                   | 7,500                   | 7,500                     | 4.9 years                                   |
| $34.17               | -                   | 173,100                 | 173,100                   | 4.4 years                                   |
| $41.58               | -                   | 325,600                 | 325,600                   | 4.2 years                                   |
|            | 1,530,700           | 1,030,427               | 2,561,127                 | 2.7 years                                   |

----

| 14.2.   | Restricted Share Units (“RSUs”) |
|-------------------|---------------------------------------------|

| 14.3.   | Share Purchase Warrants |
|-------------------|-------------------------|

|                       | Warrants Outstanding | Weighted Average Exercise Price | Exchange Ratio |
|----------------------------|----------------------|---------------------------------|----------------|
|  At January 1, 2010   | 2,718,265            | $20.00                          | 1.00           |
| Exercised                  | (60)                 | 20.00                           | 1.00           |
| At December 31, 2010       | 2,718,205            | $20.00                          | 1.00           |
| Exercised                  | (4,968)              | 20.00                           | 1.00           |
|  At December 31, 2011 | 2,713,237            | $20.00                          | 1.00           |

| 15.1.   | Performance Share Units (“PSUs”) |
|-------------------|----------------------------------------------|

----

|                              | Number of PSUsOutstanding |
|-----------------------------------|---------------------------|
|  At December 31, 2010        | -                         |
| Granted                           | 62,800                    |
| Forfeited                         | (21,115)                  |
| Dividend equivalent participation | 228                       |
|  At December 31, 2011        | 41,913                    |

|                                                        | Year Ended December 31 |
|-------------------------------------------------------------|------------------------|
| (in thousands)                                              | 2011                   | 2010 |
|  Basic weighted average number of shares outstanding   |                   | 353,249 |   | 344,288 |
| Effect of dilutive securities                               |                   |   |   |   |
| Share purchase options                                      |                   | 1,307 |   | 1,703 |
| Share purchase warrants                                     |                   | 1,186 |   | 340 |
| Restricted share units                                      |                   | 162 |   | 177 |
|  Diluted weighted average number of shares outstanding |                   | 355,904 |   | 346,508 |

----

|                                          | Year Ended December 31 |
|-----------------------------------------------|------------------------|
| (in thousands)                                | 2011                   | 2010 |
|  Share purchase options                  |                   | 314 |   | - |
| US dollar denominated share purchase warrants |                   | - |   | - |
|  Total                                   |                   | 314 |   | - |

|                                                      | Year Ended December 31 |
|-----------------------------------------------------------|------------------------|
| (in thousands)                                            | 2011                   | 2010 |
|  Canadian dollar denominated share purchase warrants |                   | - |   | 3,921 |

|                                           | Year Ended December 31 |
|------------------------------------------------|------------------------|
| (in thousands)                                 | 2011                   | 2010 |
|  Change in non-cash working capital       |                   |   |   |   |
| Accounts receivable                            | $                      | 3,198 | $ | (2,206) |
| Accounts payable and accrued liabilities       |                   | (918) |   | (102) |
| Other                                          |                   | (494) |   | 299 |
|  Total change in non-cash working capital | $                      | 1,786 | $ | (2,009) |

|                                                         | Year Ended December 31 |
|--------------------------------------------------------------|------------------------|
| (in thousands)                                               | 2011                   | 2010 |
|  Short-term benefits 1                                  | $                      | 5,504 | $ | 4,759 |
| Post-employment benefits                                     |                   | 57 |   | 43 |
| Cash settled stock based compensation                        |                   | 286 |   | - |
| Equity settled stock based compensation (a non-cash expense) |                   | 5,159 |   | 5,397 |
|  Total executive compensation                           | $                      | 11,006 | $ | 10,199 |

| 1)   | Short-term employee benefits include salaries, bonuses payable within twelve months of the balance sheet date and other annual employee benefits. |
|----------------|---------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                                                                     |   | Year Ended December 31 |
|----------------------------------------------------------------------------------------------------------|--------|------------------------|
| (in thousands)                                                                                           |   | 2011                   |   | 2010 |
|  Current income tax expense related to foreign jurisdictions                                        |   | $                      | 762 |   | $ | 376 |
| Deferred income tax expense (recovery) relating to the origination and reversal of temporary differences |   |                   | 7,575 |   |   | (10,248) |
|  Income tax expense (recovery) recognized in net earnings                                           |   | $                      | 8,337 |   | $ | (9,872) |

|                                                             |   | Year Ended December 31 |
|------------------------------------------------------------------|--------|------------------------|
| (in thousands)                                                   |   | 2011                   |   | 2010 |
|  Deferred income tax recovery relating to share issue costs |   | $                      | - |   | $ | (3,352) |

|                                                                                                                     |   | Year Ended December 31 |
|--------------------------------------------------------------------------------------------------------------------------|--------|------------------------|
| (in thousands)                                                                                                           |   | 2011                   |   | 2010 |
|  Deferred income tax (recovery) expense related to the (losses) gains on long-term investments - common shares held |   | $                      | (10,699) |   | $ | 14,422 |

----

|                                                                   |   |   | Year Ended December 31 |
|------------------------------------------------------------------------|--------|--------|------------------------|
| (in thousands)                                                         |   |   | 2011                   |   | 2010 |
|  Earnings from continuing operations before income taxes          |   |   | $                      | 558,365 |   | $ | 143,509 |
| Canadian federal and provincial income tax rates                       |   |   |                   | 26.50% |   |   | 28.50% |
|  Income tax expense based on above rates                          |   |   | $                      | 147,967 |   | $ | 40,900 |
| Canadian functional currency election 1                                |   |   |                   | (3,556) |   |   |  - |
| Non-deductible portion of capital losses, net of capital gains         |   |   |                   | 429 |   |   | (861) |
| Non-deductible stock based compensation and other                      |   |   |                   | 2,141 |   |   | 2,339 |
| Non-taxable loss on derivative liability                               |   |   |                   |  - |   |   | 38,279 |
| Differences in tax rates in foreign jurisdictions                      |   |   |                   | (142,433) |   |   | (74,107) |
| Impact of future income tax rate applied versus current statutory rate |   |   |                   | (290) |   |   | (230) |
| Change in unrecognized temporary differences                           |   |   |                   | 4,079 |   |   | (16,192) |
|  Income tax expense (recovery)                                    |   |   | $                      | 8,337 |   | $ | (9,872) |

| 1)   | The Company has elected to prepare its Canadian tax returns using US dollar functional currency, effective January 1, 2011. The election resulted in a one-time benefit of $3.6 million. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                                            | Year Ended December 31, 2011 |
|---------------------------------------------------------------------------------|------------------------------|
|                                                                            |                         |   |   | Recognized InIncome Tax Expense | Recognized In OCI | Recognized In Shareholders' Equity |   |   |
| Recognized deferred tax assets and liabilities                                  | Opening Balance              | Functional Currency Election | Other | Closing Balance |
|  Deferred tax assets                                                       |                         |   |   |   |   |   |   |   |   |   |   |   |
| Non-capital losses                                                              | $                            | 16,153 | $ | - | $ | (3,415) | $ | - | $ | - | $ | 12,738 |
| Long-term investments                                                           |                         | 366 |   | - |   | - |   | (366) |   | - |   | - |
| Financing fees                                                                  |                         | 4,467 |   | - |   | (1,772) |   | -  |   | - |   | 2,695 |
| Capital losses                                                                  |                         | 8,775 |   | - |   | (3,495) |   | (434) |   | - |   | 4,846 |
| Foreign exchange on investments                                                 |                         | 792 |   | - |   | (792) |   | - |   | - |   | - |
| Other                                                                           |                         | 184 |   | 6 |   | 100 |   | - |   | - |   | 290 |
|  Deferred tax liabilities                                                  |                         |   |   |   |   |   |   |   |   |   |   |   |
| Interest capitalized for accounting but    deducted for tax |                         | (10,758) |   | 669 |   | (40) |   | - |   | - |   | (10,129) |
| Foreign exchange on debt                                                        |                         | (575) |   | - |   | 154 |   | - |   | - |   | (421) |
| Long-term investments                                                           |                         | (16,230) |   | - |   | 306 |   | 11,499 |   | - |   | (4,425) |
| Silver and gold interests                                                       |                         | (3,996) |   | 2,881 |   | (2,178) |   | - |   | - |   | (3,293) |
|  Total                                                                     | $                            | (822) | $ | 3,556 | $ | (11,132) | $ | 10,699 | $ | - | $ |        2,301 |

----

|                                                                            | Year Ended December 31, 2010 |
|---------------------------------------------------------------------------------|------------------------------|
|                                                                            |                         |   |   | Recognized InIncome Tax Expense | Recognized In OCI | Recognized In Shareholders' Equity |   |   |
| Recognized deferred tax assets and liabilities                                  | Opening Balance              | Foreign Exchange | Other | Closing Balance |
|  Deferred tax assets                                                       |                         |   |   |   |   |   |   |   |   |   |   |   |
| Non-capital losses                                                              | $                            | 9,805 | $ | 512 | $ | 3,908 | $ | - | $ | 1,928 | $ | 16,153 |
| Long-term investments                                                           |                         | - |   | - |   | - |   | 366 |   | - |   | 366 |
| Financing fees                                                                  |                         | 4,634 |   | 242 |   | (1,833) |   | -  |   | 1,424 |   | 4,467 |
| Capital losses                                                                  |                         | - |   | - |   | 8,775 |   | - |   | - |   | 8,775 |
| Foreign exchange on investments                                                 |                         | - |   | - |   | 792 |   | - |   | - |   | 792 |
| Other                                                                           |                         | - |   | - |   | 184 |   | - |   | - |   | 184 |
|  Deferred tax liabilities                                                  |                         |   |   |   |   |   |   |   |   |   |   |   |
| Interest capitalized for accounting but    deducted for tax |                         | (10,051) |   | (525) |   | (182) |   | - |   | - |   | (10,758) |
| Foreign exchange on debt                                                        |                         | - |   | - |   | (575) |   | - |   | - |   | (575) |
| Long-term investments                                                           |                         | - |   | - |   | (1,442) |   | (14,788) |   | - |   | (16,230) |
| Silver and gold interests                                                       |                         | (4,388) |   | (229) |   | 621 |   | - |   | - |   | (3,996) |
|  Total                                                                     | $                            | - | $ | - | $ | 10,248 | $ | (14,422) | $ | 3,352 | $ | (822) |

|                                       |   | December 31 | December 31 | January 1 |
|--------------------------------------------|--------|-------------|-------------|-----------|
|                                       |   | 2011        | 2010        | 2010      |
|  Non-capital losses                   |   | $           | -           | $         | - | $ | 6,897 |
| Capital losses                             |   |        | 3,971       |      | - |   | 7,283 |
| Unrealized foreign exchange                |   |        | 27          |      | - |   | 848 |
| Unrealized losses on long-term investments |   |        | 4,272       |      | - |   | 2,776 |
| Financing fees                             |   |        | -           |      | - |   | 2,007 |
| Other                                      |   |        | -           |      | - |   | 355 |
|  Total                                |   | $           | 8,270       | $         | - | $ | 20,166 |

----

| Silver and Gold Interests | Attributable Payable Production to be Purchased | Per Ounce Cash Payment 1,2 | Term ofAgreement | Date ofContract |
|---------------------------|-------------------------------------------------|----------------------------|------------------|-----------------|
| Silver                    | Gold                                            | Silver                     | Gold             |
| San Dimas                 | 100% 3                                          | -                          | $                | 4.08            |   | n/a | Life of Mine | 15-Oct-04 |
| Zinkgruvan                | 100%                                            | -                          | $                | 4.14            |   | n/a | Life of Mine | 8-Dec-04 |
| Yauliyacu                 | 100% 4                                          | -                          | $                | 4.02            |   | n/a | 20 years | 23-Mar-06 |
| Peñasquito           | 25%                                             | -                          | $                | 3.96            |   | n/a | Life of Mine | 24-Jul-07 |
| Minto                     | 100%                                            | 100% 5                     | $                | 3.94            | $ | 303 | Life of Mine | 1-Dec-08 |
| Cozamin                   | 100%                                            | -                          | $                | 4.08 6          |   | n/a | 10 years | 4-Apr-07 |
| Barrick                   |                                            |                       |             |            |   |   |   |   |
| Pascua-Lama               | 25%                                             | -                          | $                | 3.90            |   | n/a | Life of Mine | 8-Sep-09 |
| Lagunas Norte             | 100%                                            | -                          | $                | 3.90            |   | n/a | 4 years 7 | 8-Sep-09 |
| Pierina                   | 100%                                            | -                          | $                | 3.90            |   | n/a | 4 years 7 | 8-Sep-09 |
| Veladero                  | 100% 8                                          | -                          | $                | 3.90            |   | n/a | 4 years 7 | 8-Sep-09 |
| Other                     |                                            |                       |             |            |   |   |   |   |
| Los Filos 3               | 100%                                            | -                          | $                | 4.13            |   | n/a | 25 years | 15-Oct-04 |
| Keno Hill                 | 25%                                             | -                          | $                | 3.90            |   | n/a | Life of Mine | 2-Oct-08 |
| Mineral Park              | 100%                                            | -                          | $                | 3.90            |   | n/a | Life of Mine | 17-Mar-08 |
| Neves-Corvo               | 100%                                            | -                          | $                | 3.98            |   | n/a | 50 years | 5-Jun-07 |
| Stratoni                  | 100%                                            | -                          | $                | 3.98            |   | n/a | Life of Mine | 23-Apr-07 |
| Campo Morado              | 75%                                             | -                          | $                | 3.90            |   | n/a | Life of Mine | 13-May-08 |
| Aljustrel                 | 100%                                            | -                          | $                | 3.94            |   | n/a | 50 years | 5-Jun-07 |
| Loma de La Plata          | 12.5%                                           | -                          | $                | 4.00            |   | n/a | Life of Mine | n/a 9 |
| Rosemont                  | 100%                                            | 100%                       | $                | 3.90            | $ | 450 | Life of Mine | 11-Feb-10 |

| 1)   | Subject to an annual inflationary adjustment with the exception of Loma de La Plata. |
|----------------|--------------------------------------------------------------------------------------|

| 2)   | Should the prevailing market price for silver or gold be lower than this amount, the per ounce cash payment will be reduced to the prevailing market price, with the exception of Yauliyacu. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3)   | Until August 6, 2014, Silver Wheaton is committed to purchase from Primero a per annum amount equal to the first 3.5 million ounces of payable silver produced at San Dimas and 50% of any excess, plus Silver Wheaton is committed to purchase an additional 1.5 million ounces of silver per annum to be delivered by Goldcorp.  After August 6, 2014, Silver Wheaton is committed to purchase from Primero a per annum amount equal to the first 6 million ounces of payable silver produced at San Dimas and 50% of any excess. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4)   | To a maximum of 4.75 million ounces per annum.  In the event that silver produced at Yauliyacu in any year totals less than 4.75 million ounces, the amount sold to Silver Wheaton in subsequent years will be increased to  make up for the shortfall, so long as production allows.  The cumulative shortfall as at March 23, 2011, representing the five year anniversary, was 9.8 million ounces. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5)   | The Company is committed to acquire 100% of the first 30,000 ounces of gold produced per annum and 50% thereafter. |
|----------------|--------------------------------------------------------------------------------------------------------------------|

| 6)   | The payment per ounce of silver delivered from the Cozamin mine may be subject to price adjustments in certain circumstances, the effects of which are being reviewed.  Management believes that ultimately no adjustment will be necessary, and, as a result, no provision has been made in these financial statements for any such adjustment. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 7)   | The Company is committed to purchase silver production from the currently producing mines until December 31, 2013.  In addition, during 2014 and 2015, the Company is committed to purchase all or a portion of the silver production from these mines to the extent of any production shortfall relative to the production guarantee levels at Pascua-Lama, until Barrick satisfies the completion guarantee. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 8)   | Silver Wheaton's attributable silver production is subject to a maximum of 8% of the silver contained in the ore mined at Veladero during the period. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------|

| 9)   | Terms of the agreement not yet finalized. |
|----------------|-------------------------------------------|

----

|                                |   | Obligations With Scheduled Payment Dates                                  | Contingent Obligations |                                                                      |      |
|-------------------------------------|--------|---------------------------------------------------------------------------|------------------------|---------------------------------------------------------------------------|-----------|
| (in thousands)                      | 2012   | 2013 - 2015                                                               | 2016 - 2017            | After 2017                                                                | Sub-Total | Total |
|  Bank debt                     | $      |     28,560                                            | $                      |     50,060                                            | $         |             - | $ |             - | $ |     78,620 | $ |             - |  $ |     78,620 |
| Interest on bank debt 1             |   |       1,006                                 |                   |          792                 |      |             - |   |             - |   |       1,798 |   |             - |   |       1,798 |
| Silver interest payments            |   |                                                                      |                   |                                                                      |      |   |   |   |   |   |   |   |   |   |
| Barrick                             |   |   137,500                                                       |                   |             - |      |             - |   |             - |   |   137,500 |   |             - |   |   137,500 |
| Rosemont 2                          |   |             - |                   |             - |      |             - |   |             - |   |             - |   |   230,000 |   |   230,000 |
| Loma de La Plata 2                  |   |             - |                   |             - |      |             - |   |             - |   |             - |   |     32,400 |   |     32,400 |
| Operating leases                    |   |          493                 |                   |       1,534                                 |      |          594 |   |             - |   |       2,621 |   |             - |   |       2,621 |
|  Total contractual obligations | $      |   167,559                                                       | $                      |     52,386                                            | $         |          594 | $ |             - | $ |   220,539 | $ |   262,400 |  $ |   482,939 |

| 1)   | As the applicable interest rates are floating in nature, the interest charges are estimated based on market-based forward interest rate curves at the end of the reporting period. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2)   | See the Contingencies section of Note 21. |
|----------------|-------------------------------------------|

----

| Year Ended December 31, 2011          |
|---------------------------------------|
|                                  | Sales | Cost of sales | Depletion | Net earnings |  Cash flow from (used in) operations |  Total assets at: |
| (in thousands)                        | Dec 31, 2011 | Dec 31, 2010 |
|  Silver                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| San Dimas 1                           | $ | 188,377 | $ | 22,826 | $ | 3,997 | $ | 161,554 | $ | 164,453 | $ | 167,527 | $ | 171,524 |
| Zinkgruvan                            |   | 52,974 |   | 5,988 |   | 2,483 |   | 44,503 |   | 49,377 |   | 57,639 |   | 60,122 |
| Yauliyacu                             |   | 43,911 |   | 5,048 |   | 6,308 |   | 32,555 |   | 38,863 |   | 230,012 |   | 236,320 |
| Peñasquito                       |   | 143,069 |   | 16,257 |   | 9,957 |   | 116,855 |   | 126,812 |   | 504,973 |   | 514,930 |
| Cozamin                               |   | 43,990 |   | 5,138 |   | 5,834 |   | 33,018 |   | 40,586 |   | 25,115 |   | 30,949 |
| Barrick                               |   | 102,454 |   | 11,343 |   | 10,419 |   | 80,692 |   | 89,554 |   | 601,085 |   | 595,307 |
| Other 2                               |   | 125,854 |   | 14,185 |   | 15,371 |   | 96,298 |   | 112,414 |   | 251,716 |   | 266,978 |
|                                  | $ | 700,629 | $ | 80,785 | $ | 54,369 | $ | 565,475 | $ | 622,059 | $ | 1,838,067 | $ | 1,876,130 |
| Gold                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Minto                                 |   | 29,368 |   | 5,481 |   | 3,088 |   | 20,799 |   | 24,240 |   | 33,659 |   | 36,747 |
|  Total silver and gold interests | $ | 729,997 | $ | 86,266 | $ | 57,457 | $ | 586,274 | $ | 646,299 | $ | 1,871,726 | $ | 1,912,877 |
| Corporate                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| General and administrative            |   |   |   |   | $ | (25,180) |   |   |   |   |   |   |
| Other                                 |   |   |   |   |   |   |   | (11,066) |   |   |   |   |   |   |
| Total corporate                       |   |   |   |   |   |   | $ | (36,246) | $ | (19,872) | $ | 1,000,609 | $ | 722,506 |
|  Consolidated                    | $ | 729,997 | $ | 86,266 | $ | 57,457 | $ | 550,028 | $ | 626,427 | $ | 2,872,335 | $ | 2,635,383 |

| 1)   | Results for San Dimas include 1.5 million ounces received from Goldcorp in connection with Goldcorp’s four year commitment to deliver to Silver Wheaton 1.5 million ounces of silver per annum resulting from their sale of San Dimas to Primero. |
|----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2)   | Comprised of the operating Los Filos, Keno Hill, Mineral Park, Neves-Corvo, Stratoni, Campo Morado, Minto and Aljustrel silver interests in addition to the non-operating Rosemont and Loma de La Plata silver interests. |
|----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Year Ended December 31, 2010                                                    |
|---------------------------------------------------------------------------------|
|                                                                            | Sales | Cost of sales | Depletion | Net earnings |  Cash flow from (used in) operations |  Total assets at: |
| (in thousands)                                                                  | Dec 31, 2010 | Jan 1, 2010 |
|  Silver                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| San Dimas 1                                                                     | $ | 105,747 | $ | 20,179 | $ | 3,909 | $ | 81,659 | $ | 86,666 | $ | 171,524 | $ | 175,431 |
| Zinkgruvan                                                                      |   | 39,447 |   | 7,552 |   | 3,198 |   | 28,697 |   | 30,178 |   | 60,122 |   | 63,320 |
| Yauliyacu                                                                       |   | 31,998 |   | 6,583 |   | 5,746 |   | 19,669 |   | 25,418 |   | 236,320 |   | 242,065 |
| Peñasquito                                                                 |   | 63,632 |   | 11,470 |   | 7,479 |   | 44,683 |   | 52,163 |   | 514,930 |   | 522,148 |
| Cozamin                                                                         |   | 29,180 |   | 5,681 |   | 6,512 |   | 16,987 |   | 23,252 |   | 30,949 |   | 37,462 |
| Barrick                                                                         |   | 48,311 |   | 9,847 |   | 8,966 |   | 29,498 |   | 36,787 |   | 595,307 |   | 580,146 |
| Other 2                                                                         |   | 73,345 |   | 13,672 |   | 15,663 |   | 44,010 |   | 58,182 |   | 266,978 |   | 265,549 |
|                                                                            | $ | 391,660 | $ | 74,984 | $ | 51,473 | $ | 265,203 | $ | 312,646 | $ | 1,876,130 | $ | 1,886,121 |
| Gold                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Minto                                                                           |   | 31,693 |   | 7,765 |   | 6,098 |   | 17,830 |   | 23,174 |   | 36,747 |   | 42,355 |
|  Total silver and gold interests                                           | $ | 423,353 | $ | 82,749 | $ | 57,571 | $ | 283,033 | $ | 335,820 | $ | 1,912,877 | $ | 1,928,476 |
| Corporate                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| General and administrative                                                      |   |   |   |   | $ | (24,669) |   |   |   |   |   |   |
| Loss on fair value adjustment of Canadian dollar share purchase warrants issued | (133,210) |   |   |   |   |   |   |
| Other 3                                                                         |   |   |   |   |   |   |   | 28,227 |   |   |   |   |   |   |
| Total corporate                                                                 |   |   |   |   |   |   | $ | (129,652) | $ | (16,094) | $ | 722,506 | $ | 309,073 |
|  Consolidated                                                              | $ | 423,353 | $ | 82,749 | $ | 57,571 | $ | 153,381 | $ | 319,726 | $ | 2,635,383 | $ | 2,237,549 |

| 1)   | Results for San Dimas include 625,000 ounces received from Goldcorp in connection with Goldcorp’s four year commitment to deliver to Silver Wheaton 1.5 million ounces of silver per annum resulting from their sale of San Dimas to Primero. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2)   | Comprised of the operating Los Filos, Mineral Park, Neves-Corvo, Stratoni, Campo Morado and Minto silver interests, the non-operating Aljustrel, Keno Hill, Rosemont and Loma de La Plata silver interests and the previously owned San Martin and La Negra silver interests. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3)   | Includes a $5.9 million gain recognized during the year ended December 31, 2010 resulting from the disposition of the La Negra silver purchase agreement. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                |            | Year Ended December 31, 2011 |
|---------------------|-----------------|------------------------------|
|                | Sales           | Carrying Amount              |
| (in thousands)      | SilverInterests | GoldInterests                |
|  North America |            |                         |   |   |   |   |
| Canada              | $               | 48,278                       | $ | 53,660 | $ | 33,659 |
| United States       |            | 21,100                       |   | 40,417 |   | - |
| Mexico              |            | 414,902                      |   | 769,537 |   | - |
| Europe              |            |                         |   |   |   |   |
| Greece              |            | 24,773                       |   | 41,401 |   | - |
| Portugal            |            | 21,605                       |   | 33,430 |   | - |
| Sweden              |            | 52,974                       |   | 57,639 |   | - |
| South America       |            |                         |   |   |   |   |
| Argentina / Chile 1 |            | 53,853                       |   | 592,153 |   | - |
| Peru                |            | 92,512                       |   | 249,830 |   | - |
|  Consolidated  | $               | 729,997                      | $ | 1,838,067 | $ | 33,659 |

| 1)   | Includes the Pascua-Lama project, which straddles the border of Chile and Argentina. |
|----------------|--------------------------------------------------------------------------------------|

|                |            | Year Ended December 31, 2010 |
|---------------------|-----------------|------------------------------|
|                | Sales           | Carrying Amount              |
| (in thousands)      | SilverInterests | GoldInterests                |
|  North America |            |                         |   |   |   |   |
| Canada              | $               | 35,056                       | $ | 56,967 | $ | 36,747 |
| United States       |            | 6,798                        |   | 42,059 |   | - |
| Mexico              |            | 235,888                      |   | 794,837 |   | - |
| Europe              |            |                         |   |   |   |   |
| Greece              |            | 16,794                       |   | 44,448 |   | - |
| Portugal            |            | 9,061                        |   | 35,182 |   | - |
| Sweden              |            | 39,447                       |   | 60,122 |   | - |
| South America       |            |                         |   |   |   |   |
| Argentina / Chile 1 |            | 22,195                       |   | 581,288 |   | - |
| Peru                |            | 58,114                       |   | 261,227 |   | - |
|  Consolidated  | $               | 423,353                      | $ | 1,876,130 | $ | 36,747 |

| 1)   |  Includes the Pascua-Lama project, which straddles the border of Chile and Argentina. |
|----------------|--------------------------------------------------------------------------------------------|

----

| ·   | IFRS 3, Business Combinations, has not been applied to acquisitions of subsidiaries or of interests in associates and joint ventures that occurred before January 1, 2010. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| (US dollars in thousands)                             | GAAP   |      | IAS 32 1 |   | IAS 32 2  |   | IAS 32 3 |      | IFRS 9 4 |   | IFRS 9 5 |     | IAS 12 6 |   | IFRS     |
|-------------------------------------------------------|--------|-----------|----------|--------|-----------|--------|----------|-----------|----------|--------|----------|----------|----------|--------|----------|
|  Assets                                          |   |      |     |   |      |   |     |      |     |   |     |     |     |   |     |   |   |   |   |   |   |   |
| Current assets                                        |   |      |     |   |      |   |     |      |     |   |     |     |     |   |     |   |   |   |   |   |   |   |   |
| Cash and cash equivalents                             | $      | 227,566   |     | $      | -         |   | $        | -         |     | $      | -        |     | $        | -      |     | $ | - |   | $ | - |   | $ | 227,566 |
| Accounts receivable                                   |   | 4,881     |     |   | -         |   |     | -         |     |   | -        |     |     | -      |     |   | - |   |   | - |   |   | 4,881 |
| Other                                                 |   | 1,027     |     |   | -         |   |     | -         |     |   | -        |     |     | -      |     |   | - |   |   | - |   |   | 1,027 |
| Total current assets                                  | $      | 233,474   |     | $      | -         |   | $        | -         |     | $      | -        |     | $        | -      |     | $ | - |   | $ | - |   | $ | 233,474 |
|  Non-current assets                              |   |      |     |   |      |   |     |      |     |   |     |     |     |   |     |   |   |   |   |   |   |   |   |
| Silver and gold interests                             | $      | 1,928,476 |     | $      | -         |   | $        | -         |     | $      | -        |     | $        | -      |     | $ | - |   | $ | - |   | $ | 1,928,476 |
| Long-term investments                                 |   | 73,747    |     |   | -         |   |     | -         |     |   | -        |     |     | -      |     |   | - |   |   | - |   |   | 73,747 |
| Other                                                 |   | 1,852     |     |   | -         |   |     | -         |     |   | -        |     |     | -      |     |   | - |   |   | - |   |   | 1,852 |
| Total non-current assets                              | $      | 2,004,075 |     | $      | -         |   | $        | -         |     | $      | -        |     | $        | -      |     | $ | - |   | $ | - |   | $ | 2,004,075 |
|  Total assets                                    | $      | 2,237,549 |     | $      | -         |   | $        | -         |     | $      | -        |     | $        | -      |     | $ | - |   | $ | - |   | $ | 2,237,549 |
|  Liabilities                                     |   |      |     |   |      |   |     |      |     |   |     |     |     |   |     |   |   |   |   |   |   |   |   |
| Current liabilities                                   |   |      |     |   |      |   |     |      |     |   |     |     |     |   |     |   |   |   |   |   |   |   |   |
| Accounts payable and accrued liabilities              | $      | 10,302    |     | $      | -         |   | $        | -         |     | $      | -        |     | $        | -      |     | $ | - |   | $ | - |   | $ | 10,302 |
| Current portion of bank debt                          |   | 28,560    |     |   | -         |   |     | -         |     |   | -        |     |     | -      |     |   | - |   |   | - |   |   | 28,560 |
| Current portion of silver interest payments           |   | 130,788   |     |   | -         |   |     | -         |     |   | -        |     |     | -      |     |   | - |   |   | - |   |   | 130,788 |
| Total current liabilities                             | $      | 169,650   |     | $      | -         |   | $        | -         |     | $      | -        |     | $        | -      |     | $ | - |   | $ | - |   | $ | 169,650 |
|  Non-current liabilities                         |   |      |     |   |      |   |     |      |     |   |     |     |     |   |     |   |   |   |   |   |   |   |   |
| Liability for Canadian dollar share purchase warrants | $      | -         |     | $      | 208,318   |   | $        | (166,626) |     | $      | 10,275   |     | $        | -      |     | $ | - |   | $ | - |   | $ | 51,967 |
| Long-term portion of bank debt                        |   | 107,180   |     |   | -         |   |     | -         |     |   | -        |     |     | -      |     |   | - |   |   | - |   |   | 107,180 |
| Long-term portion of silver interest payments         |   | 236,796   |     |   | -         |   |     | -         |     |   | -        |     |     | -      |     |   | - |   |   | - |   |   | 236,796 |
| Total non-current liabilities                         | $      | 343,976   |     | $      | 208,318   |   | $        | (166,626) |     | $      | 10,275   |     | $        | -      |     | $ | - |   | $ | - |   | $ | 395,943 |
|  Total liabilities                               | $      | 513,626   |     | $      | 208,318   |   | $        | (166,626) |     | $      | 10,275   |     | $        | -      |     | $ | - |   | $ | - |   | $ | 565,593 |
|  Shareholders' Equity                            |   |      |     |   |      |   |     |      |     |   |     |     |     |   |     |   |   |   |   |   |   |   |   |
| Issued capital                                        | $      | 1,302,301 |     | $      | -         |   | $        | 166,626   |     | $      | -        |     | $        | -      |     | $ | - |   | $ | 7,553 |   | $ | 1,476,480 |
| Reserves                                              |   |      | 77,788   |   |      | -      |     |      | -        |   |     | (10,275) |     |   | (64,149) |   |   | 1,247 |   |   | - |   |   | 4,611 |
| Retained earnings                                     |   | 343,834   |     |   | (208,318) |   |     | -         |     |   | -        |     |     | 64,149 |     |   | (1,247) |   |   | (7,553) |   |   | 190,865 |
| Total shareholders' equity                            | $      | 1,723,923 |     | $      | (208,318) |   | $        | 166,626   |     | $      | (10,275) |     | $        | -      |     | $ | - |   | $ | - |   | $ | 1,671,956 |
|  Total liabilities and shareholders' equity      | $      | 2,237,549 |     | $      | -         |   | $        | -         |     | $      | -        |     | $        | -      |     | $ | - |   | $ | - |   | $ | 2,237,549 |

| 1)   | IAS 32 – Financial Instruments Presentation - to record the fair value adjustment on the Company's share purchase warrants issued with an exercise price denominated in Canadian dollars. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2)   | IAS 32 – Financial Instruments Presentation - to record the fair value increment on the exercise of the Company's share purchase warrants issued with an exercise price denominated in Canadian dollars. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3)   | IAS 32 – Financial Instruments Presentation - to reclassify share purchase warrants issued with an exercise price denominated in Canadian dollars. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4)   | IFRS 9 – Financial Instruments - to reclassify the Canadian GAAP other-than-temporary unrealized loss on long-term investments – common shares held. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5)   | IFRS 9 – Financial Instruments - to reclassify the realized gain on long-term investments – common shares held. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------|

| 6)   | IAS 12 - Income Taxes - to reclassify the realization of deferred income tax assets associated with the Company's share issue costs. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------|

| 7)   | Certain GAAP figures have been reclassified to conform to the presentation adopted in 2011. |
|----------------|---------------------------------------------------------------------------------------------|

----

| (US dollars in thousands)                             | GAAP   |      | IAS 32 1 |   | IAS 32 2  |   | IFRS 9 3 |      | IFRS 9 4 |   | IAS 12 5 |     | IFRS   |
|-------------------------------------------------------|--------|-----------|----------|--------|-----------|--------|----------|-----------|----------|--------|----------|----------|--------|
|  Assets                                          |   |      |     |   |      |   |     |      |     |   |     |     |   |   |   |   |   |   |   |   |
| Current assets                                        |   |      |     |   |      |   |     |      |     |   |     |     |   |   |   |   |   |   |   |   |
| Cash and cash equivalents                             | $      | 428,636   |     | $      | -         |   | $        | -         |     | $      | -        |     | $      | - |   | $ | - |   | $ | 428,636 |
| Accounts receivable                                   |   | 7,088     |     |   | -         |   |     | -         |     |   | -        |     |   | - |   |   | - |   |   | 7,088 |
| Other                                                 |   |      | 727      |   |      | -      |     |      | -        |   |     | -        |   |   | - |   |   | - |   |   | 727 |
| Total current assets                                  | $      | 436,451   |     | $      | -         |   | $        | -         |     | $      | -        |     | $      | - |   | $ | - |   | $ | 436,451 |
|  Non-current assets                              |   |      |     |   |      |   |     |      |     |   |     |     |   |   |   |   |   |   |   |   |
| Silver and gold interests                             | $      | 1,912,877 |     | $      | -         |   | $        | -         |     | $      | -        |     | $      | - |   | $ | - |   | $ | 1,912,877 |
| Long-term investments                                 |   | 284,448   |     |   | -         |   |     | -         |     |   | -        |     |   | - |   |   | - |   |   | 284,448 |
| Other                                                 |   | 1,607     |     |   | -         |   |     | -         |     |   | -        |     |   | - |   |   | - |   |   | 1,607 |
| Total non-current assets                              | $      | 2,198,932 |     | $      | -         |   | $        | -         |     | $      | -        |     | $      | - |   | $ | - |   | $ | 2,198,932 |
|  Total assets                                    | $      | 2,635,383 |     | $      | -         |   | $        | -         |     | $      | -        |     | $      | - |   | $ | - |   | $ | 2,635,383 |
|  Liabilities                                     |   |      |     |   |      |   |     |      |     |   |     |     |   |   |   |   |   |   |   |   |
| Current liabilities                                   |   |      |     |   |      |   |     |      |     |   |     |     |   |   |   |   |   |   |   |   |
| Accounts payable and accrued liabilities              | $      | 9,843     |     | $      | -         |   | $        | -         |     | $      | -        |     | $      | - |   | $ | - |   | $ | 9,843 |
| Current portion of bank debt                          |   | 28,560    |     |   | -         |   |     | -         |     |   | -        |     |   | - |   |   | - |   |   | 28,560 |
| Current portion of silver interest payments           |   | 133,243   |     |   | -         |   |     | -         |     |   | -        |     |   | - |   |   | - |   |   | 133,243 |
| Total current liabilities                             | $      | 171,646   |     | $      | -         |   | $        | -         |     | $      | -        |     | $      | - |   | $ | - |   | $ | 171,646 |
|  Non-current liabilities                         |   |      |     |   |      |   |     |      |     |   |     |     |   |   |   |   |   |   |   |   |
| Deferred income tax liability                         | $      | 822       |     | $      | -         |   | $        | -         |     | $      | -        |     | $      | - |   | $ | - |   | $ | 822 |
| Liability for Canadian dollar share purchase warrants |   | -         |     |   | 341,528   |   |     | (341,528) |     |   | -        |     |   | - |   |   | - |   |   | - |
| Long-term portion of bank debt                        |   | 78,620    |     |   | -         |   |     | -         |     |   | -        |     |   | - |   |   | - |   |   | 78,620 |
| Long-term portion of silver interest payments         |   | 122,346   |     |   | -         |   |     | -         |     |   | -        |     |   | - |   |   | - |   |   | 122,346 |
| Total non-current liabilities                         | $      | 201,788   |     | $      | 341,528   |   | $        | (341,528) |     | $      | -        |     | $      | - |   | $ | - |   | $ | 201,788 |
|  Total liabilities                               | $      | 373,434   |     | $      | 341,528   |   | $        | (341,528) |     | $      | -        |     | $      | - |   | $ | - |   | $ | 373,434 |
|  Shareholders' Equity                            |   |      |     |   |      |   |     |      |     |   |     |     |   |   |   |   |   |   |   |   |
| Issued capital                                        | $      | 1,430,075 |     | $      | -         |   | $        | 341,528   |     | $      | -        |     | $      | - |   | $ | 10,907 |   | $ | 1,782,510 |
| Reserves                                              |   |      | 197,947  |   |      | -      |     |      | -        |   |     | (64,149) |   |   | 1,566 |   |   | - |   |   | 135,364 |
| Retained earnings                                     |   | 633,927   |     |   | (341,528) |   |     | -         |     |   | 64,149   |     |   | (1,566) |   |   | (10,907) |   |   | 344,075 |
| Total shareholders' equity                            | $      | 2,261,949 |     | $      | (341,528) |   | $        | 341,528   |     | $      | -        |     | $      | - |   | $ | - |   | $ | 2,261,949 |
|  Total liabilities and shareholders' equity      | $      | 2,635,383 |     | $      | -         |   | $        | -         |     | $      | -        |     | $      | - |   | $ | - |   | $ | 2,635,383 |

| 1)   | IAS 32 – Financial Instruments Presentation - to record the fair value adjustment on the Company's share purchase warrants issued with an exercise price denominated in Canadian dollars. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2)   | IAS 32 – Financial Instruments Presentation - to record the fair value increment on the exercise of the Company's share purchase warrants issued with an exercise price denominated in Canadian dollars. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3)   | IFRS 9 – Financial Instruments - to reclassify the Canadian GAAP other-than-temporary unrealized loss on long-term investments – common shares held. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4)   | IFRS 9 – Financial Instruments - to reclassify the realized gain on long-term investments – common shares held. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------|

| 5)   | IAS 12 - Income Taxes - to reclassify the realization of deferred income tax assets associated with the Company's share issue costs. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------|

| 6)   | Certain GAAP figures have been reclassified to conform to the presentation adopted in 2011. |
|----------------|---------------------------------------------------------------------------------------------|

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| (US dollars in thousands)                                                       | GAAP   | IAS 32 1 | IFRS 9 2 | IFRS 12 3 | IFRS      |
|---------------------------------------------------------------------------------|--------|----------|----------|-----------|-----------|
|  Sales                                                                     | $      | 423,353  | $        | -         | $         | - | $ | - | $ | 423,353 |
|  Cost of sales                                                             |   |     |     |      |      |   |   |   |   |   |   |
| Cost of sales, excludingdepletion                                               | $      | 82,749   | $        | -         | $         | - | $ | - | $ | 82,749 |
| Depletion                                                                       |   | 57,571   |     | -         |      | - |   | - |   | 57,571 |
|                                                                            | $      | 140,320  | $        | -         | $         | - | $ | - | $ | 140,320 |
|  Earnings from operations                                                  | $      | 283,033  | $        | -         | $         | - | $ | - | $ | 283,033 |
|  Expenses and other income                                                 |   |     |     |      |      |   |   |   |   |   |
| General and administrative                                                      |   | $        | 24,669   | $         | -         | $ | - | $ | - | $ | 24,669 |
| Loss on fair value adjustment of Canadian dollar share purchase warrants issued |   |     | -        |      | 133,210   |   | - |   | - |   | 133,210 |
| Foreign exchange gain                                                           |   |     | (2,266)  |      | -         |   | - |   | - |   | (2,266) |
| Other (income) expense                                                          |   |     | (16,239) |      | -         |   | 150 |   | - |   | (16,089) |
|                                                                            | $      | 6,164    | $        | 133,210   | $         | 150 | $ | - | $ | 139,524 |
|  Earnings before tax                                                       | $      | 276,869  | $        | (133,210) | $         | (150) | $ | - | $ | 143,509 |
| Income tax recovery                                                             |   | 13,224   |     | -         |      | - |   | (3,352) |   | 9,872 |
|  Net earnings                                                              | $      | 290,093  | $        | (133,210) | $         | (150) | $ | (3,352) | $ | 153,381 |
| Other comprehensive income                                                      |   |     |     |      |      |   |   |   |   |   |
| Gain on long-term investments - common shares held                              |   |     | 146,193  |      | -         |   | 150 |   | - |   | 146,343 |
| Deferred income tax expense                                                     |   |     | (14,422) |      | -         |   | - |   | - |   | (14,422) |
|  Comprehensive income (loss)                                               |   | $        | 421,864  | $         | (133,210) | $ | - | $ | (3,352) | $ | 285,302 |

| 1)   | IAS 32 – Financial Instruments Presentation - to record the fair value adjustment on the Company's share purchase warrants issued with an exercise price denominated in Canadian dollars |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2)   | IFRS 9 – Financial Instruments - to reclassify the increase in value of long-term investments – common shares held which were disposed of during the year. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3)   | IAS 12 - Income Taxes - to reclassify the realization of deferred income tax assets associated with the Company's share issue costs. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------|

| 4)   | Certain GAAP figures have been reclassified to conform to the presentation adopted in 2011. |
|----------------|---------------------------------------------------------------------------------------------|

| (in thousands)                                                             |   |
|----------------------------------------------------------------------------|--------|
|  Cash generated by operating activities - as reported under GAAP      | $      | 319,761 |
| Adjustments:                                                               |   |   |
| Reallocate dividend income received to a component of investing activities |   | (35) |
|  Cash generated by operating activities - as reported under IFRS      | $      | 319,726 |

----

| (in thousands)                                                               |   |
|------------------------------------------------------------------------------|--------|
|  Cash applied to investing activities - as reported under GAAP          | $      | (201,325) |
| Adjustments:                                                                 |   |   |
| Reallocate dividend income received from a component of operating activities |   | 35 |
|  Cash applied to investing activities - as reported under IFRS          | $      | (201,290) |

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|   |   CANADA – HEAD OFFICESilver Wheaton Corp. Park Place, Suite 3150666 Burrard StreetVancouver, BC V6C 2X8CanadaT: 1 604 684 9648F: 1 604 684 3123 CAYMAN ISLANDS OFFICESilver Wheaton (Caymans) Ltd.Unit #5 - 201 Governors Square23 Lime Tree Bay AvenueP.O. Box 1791 George Town, Grand CaymanCayman Islands KY1-1109 STOCK EXCHANGE LISTINGToronto Stock Exchange: SLWNew York Stock Exchange: SLW DIRECTORSLawrence BellGeorge BrackJohn BroughPeter GillinDouglas Holtby, ChairmanEduardo LunaWade NesmithRandy Smallwood OFFICERSRandy SmallwoodPresident & Chief Executive Officer Curt BernardiSenior Vice President,Legal & Corporate Secretary Gary BrownSenior Vice President &Chief Financial Officer Haytham HodalySenior Vice President, Corporate Development Brad KoppSenior Vice President,Investor Relations |   TRANSFER AGENTCIBC Mellon Trust Company 1600 - 1066 West Hastings StreetVancouver, BC V6E 3X1 Toll-free in Canada and the United States:1 800 387 0825 Outside of Canada and the United States:1 416 682 3860 E: inquiries@canstockta.com AUDITORSDeloitte & Touche LLPVancouver, BC INVESTOR RELATIONSBrad KoppSenior Vice President, Investor RelationsT:      1 604 684 9648TF:    1 800 380 8687E:   info@silverwheaton.com |
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