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**Exhibit 99.1**



|                                    
|------------------------------------
|                                    
|SILVER WHEATON CORP.                
|                                    
|                                    
|ANNUAL INFORMATION FORM             
|FOR THE YEAR ENDED DECEMBER 31, 2013
|                                    
|March 31, 2014                      
|                                    
|                                    
|Suite 3150, 666 Burrard Street      
|Vancouver, B.C. V6C 2X8             

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|SILVER WHEATON CORP.                
|------------------------------------
|ANNUAL INFORMATION FORM             
|FOR THE YEAR ENDED DECEMBER 31, 2013
|                                    
|TABLE OF CONTENTS                   

|DESCRIPTION                                                      | PAGE
      NO.
|---------------------------------------------------------------- | --------------
|                                                                 |               
|INTRODUCTORY NOTES                                               | 1             
|CORPORATE STRUCTURE                                              | 3             
|GENERAL DEVELOPMENT OF THE BUSINESS                              | 3             
|DESCRIPTION OF THE BUSINESS                                      | 6             
|Principal Product                                                | 7             
|Competitive Conditions                                           | 13            
|Operations                                                       | 13            
|Risk Factors                                                     | 13            
|TECHNICAL INFORMATION                                            | 20            
|SAN DIMAS MINES, MEXICO                                          | 27            
|PEÑASQUITO MINE, MEXICO                                          | 35            
|PASCUA-LAMA PROJECT, BORDER OF CHILE AND ARGENTINA               | 46            
|SALOBO MINE, BRAZIL                                              | 52            
|DIVIDENDS                                                        | 63            
|DESCRIPTION OF CAPITAL STRUCTURE                                 | 63            
|TRADING PRICE AND VOLUME                                         | 65            
|DIRECTORS AND OFFICERS                                           | 66            
|INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL
      TRANSACTIONS | 70            
|TRANSFER AGENT AND REGISTRAR                                     | 70            
|MATERIAL CONTRACTS                                               | 71            
|INTERESTS OF EXPERTS                                             | 71            
|AUDIT COMMITTEE                                                  | 72            
|ADDITIONAL INFORMATION                                           | 73            

SCHEDULE A  AUDIT COMMITTEE CHARTER

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INTRODUCTORY NOTES

Cautionary Note Regarding Forward-Looking Statements

This annual information form contains forward-looking
statements within the meaning of the United States Private Securities
Litigation Reform Act of 1995 and forward-looking information within the
meaning of applicable Canadian securities legislation. Forward-looking
statements, which are all statements other than statements of historical fact,
include, but are not limited to, statements with respect to the future price of
silver or gold, the estimation of mineral reserves and resources, the
realization of mineral reserve estimates, the timing and amount of estimated
future production, costs of production, reserve determination, reserve
conversion rates, statements as to any future dividends, the ability to fund
outstanding commitments and continue to acquire accretive precious metal stream
interests and assessments of the impact and resolution of various legal and tax
matters. Generally, these forward-looking statements can be identified by the
use of forward-looking terminology such as plans, expects or does not
expect, is expected, budget, scheduled, estimates, forecasts,
intends, anticipates or does not anticipate, or believes, or variations
of such words and phrases or statements that certain actions, events or results
may, could, would, might or will be taken, occur or be achieved.
Forward-looking statements are subject to known and unknown risks, uncertainties
and other factors that may cause the actual results, operations, level of
activity, performance or achievements of Silver Wheaton (as defined herein) to
be materially different from those expressed or implied by such forward-looking
statements, including but not limited to: fluctuations in the price of silver or
gold; the absence of control over mining operations from which Silver Wheaton
purchases silver or gold and risks related to these mining operations including
risks related to fluctuations in the price of the primary commodities mined at
such operations, actual results of mining and exploration activities,
environmental, economic and political risks of the jurisdictions in which the
mining operations are located and changes in project parameters as plans
continue to be refined; differences in the interpretation or application of tax
laws and regulations; and Silver Wheatons interpretation of, or compliance
with, tax laws, is found to be incorrect; as well as those factors discussed in
the section entitled Risk Factors in this annual information form.
Forward-looking statements are based on assumptions management believes to be
reasonable, including but not limited to: the continued operation of the mining
operations from which Silver Wheaton purchases silver and gold, no material
adverse change in the market price of commodities, that the mining operations
will operate and the mining projects will be completed in accordance with their
public statements and achieve their stated production outcomes, the continuing
ability to fund or obtain funding for outstanding commitments, the ability to
source and obtain accretive precious metal stream interests, expectations
regarding the resolution of legal and tax matters, that Silver Wheaton will be
successful in challenging any reassessment by the Canada Revenue Agency and such
other assumptions and factors as set out herein. Although Silver Wheaton has
attempted to identify important factors that could cause actual results to
differ materially from those contained in forward-looking statements, there may
be other factors that cause results not to be as anticipated, estimated or
intended. There can be no assurance that forward-looking statements will prove
to be accurate. Accordingly, readers should not place undue reliance on
forward-looking statements and are cautioned that actual outcomes may vary. The
forward-looking statements and forward-looking information contained or
incorporated by reference in this annual information form are included for the
purpose of providing investors with information to assist them in understanding
Silver Wheatons expected financial and operational performance and may not be
appropriate for other purposes. Silver Wheaton does not undertake to update any
forward-looking statements that are included or incorporated by reference
herein, except in accordance with applicable securities laws.

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Currency Presentation and Exchange Rate Information

This annual information form contains references to United
States dollars and Canadian dollars. All dollar amounts referenced, unless
otherwise indicated, are expressed in United States dollars. Canadian dollars
are referred to as Canadian dollars or C$.

The high, low and closing noon spot rates for Canadian dollars
in terms of the United States dollar for each of the three years in the period
ended December 31, 2013, as quoted by the Bank of Canada, were as follows:

|        |  | Year ended December
      31 | 
|------- |  | ---------------------------- | 
|        |  | 2013                         | 
|        |  |                              | 
|High    |  | C$1.0706                     | 
|Low     |  | 0.9832                       | 
|Closing |  | 1.0623                       | 

On March 26, 2014, the noon spot rate for Canadian dollars in
terms of the United States dollar, as quoted by the Bank of Canada, was US$1.00
= C$1.1143.

Silver Prices

The high, low, average and closing fixing silver prices in
United States dollars per troy ounce for each of the three years in the period
ended December 31, 2013, as quoted by the London Bullion Market Association,
were as follows:

|        |   | Year ended December
      31 | 
|------- | - | ---------------------------- | 
|        |   | 2013                         | 
|        |   |                              | 
|High    | $ | 32.23                        | 
|Low     |   | 18.61                        | 
|Average |   | 23.79                        | 
|Closing |   | 19.50                        | 

On March 26, 2014, the closing fixing silver price in United
States dollars per troy ounce, as quoted by the London Bullion Market
Association, was $20.03.

Gold Prices

The high, low, average and closing afternoon fixing gold prices
in United States dollars per troy ounce for each of the three years in the
period ended December 31, 2013, as quoted by the London Bullion Market
Association, were as follows:

|        |   | Year ended December
      31 | 
|------- | - | ---------------------------- | 
|        |   | 2013                         | 
|        |   |                              | 
|High    | $ | 1,693.75                     | 
|Low     |   | 1,192.00                     | 
|Average |   | 1,411.23                     | 
|Closing |   | 1,204.50                     | 

On March 26, 2014, the closing afternoon fixing gold price in
United States dollars per troy ounce, as quoted on the London Bullion Market
Association, was $1,304.00.

- 2 -

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CORPORATE STRUCTURE

Pursuant to Articles of Continuance dated December 17, 2004,
Silver Wheaton Corp. (Silver Wheaton or the Company) was continued under the
Business Corporations Act(Ontario).

The Companys head office is located at Suite 3150, Park Place,
666 Burrard Street, Vancouver, British Columbia, V6C 2X8 and its registered
office is located at Suite 2100, 40 King Street West, Toronto, Ontario, M5H 3C2.

The Companys active subsidiaries are Silver Wheaton (Caymans)
Ltd. (Silver Wheaton Caymans) which is wholly-owned by the Company and is
governed by the laws of the Cayman Islands and Silver Wheaton Luxembourg
S.a.r.l. (Silver Wheaton Luxembourg) which is wholly-owned by Silver Wheaton
Caymans and is governed by the laws of Luxembourg. As of December 31, 2012,
Silverstone Resources (Barbados) Corp. was liquidated into Silver Wheaton
Caymans. As used in this annual information form, except as otherwise required
by the context, reference to Silver Wheaton or the Company means Silver
Wheaton Corp., Silver Wheaton Caymans and Silver Wheaton Luxembourg.

SILVER WHEATON AND ITS PRINCIPAL SUBSIDIARIES

****

GENERAL DEVELOPMENT OF THE BUSINESS

Three Year History

Vale Transaction

Salobo Mine

On February 28, 2013, Silver Wheaton Caymans entered into an
agreement (the Salobo Mine Purchase Agreement) to acquire from Vale S.A.
(Vale) an amount of gold equal to 25% of the life of mine gold production from
its currently producing Salobo mine (the Salobo Mine), located in Brazil.
Silver Wheaton Caymans made a total upfront cash payment of $1.33 billion on
March 12, 2013 and, in addition, will make ongoing payments of the lesser of
$400 per ounce of gold (subject to an inflationary adjustment of 1% beginning in
the fourth year) or the prevailing market price per ounce of gold delivered.

Vale is in the process of expanding the mill throughput
capacity at the Salobo Mine to 24 million tonnes per annum from its current 12
million tonnes per annum. If the expansion to 24 million tonnes per annum is not
completed by December 31, 2016, Silver Wheaton Caymans would be entitled to a
gross up (a temporary increased percentage of gold production) based on the pro-rata achievement of the target
production. If throughput capacity is expanded above 28 million tonnes per annum
within a predetermined period, Silver Wheaton Caymans will be required to make
an additional payment to Vale based on a set fee schedule ranging from $67
million if throughput capacity is expanded to 28 million tonnes per annum by
January 1, 2031 up to $400 million if throughput capacity is expanded to 40
million tonnes per annum prior to January 1, 2021.

- 3 -

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See Further Disclosure Regarding Mineral Projects on Material
Properties  Salobo Mine, Brazil for details regarding the Salobo Mine.

Sudbury Mine

On February 28, 2013, the Company entered into an agreement to
acquire from Vale an amount of gold equal to 70% of the gold production from
certain of its currently producing Sudbury mines located in Canada, including
the Coleman mine, Copper Cliff mine, Garson mine, Stobie mine, Creighton mine,
Totten mine and the Victor project (the Sudbury Mines) for a period of 20
years. Silver Wheaton made a total upfront cash payment in March, 2013 of $570
million plus warrants to purchase 10 million shares of Silver Wheaton common
stock at a strike price of $65, with a term of 10 years. In addition, Silver
Wheaton will make ongoing payments of the lesser of $400 per ounce of gold or
the prevailing market price per ounce of gold delivered.

New Credit Facilities

On February 28, 2013, the Company entered into two new credit
facilities, comprised of (i) a $1 billion revolving credit facility having a
five year term (the Revolving Facility); and (ii) a $1.5 billion bridge
financing facility having a one year term (the Bridge Facility). The Revolving
Facility and Bridge Facility replaced the pre-existing $400 million revolver
loan and the $200 million non-revolving term loan, with the latter being repaid
in full on February 22, 2013.

On May 28, 2013, the Company entered into a $1 billion
non-revolving term loan (NRT Loan) with a three-year term, extendable by one
year with the unanimous consent of lenders. On March 31, 2014, the term of the
NRT Loan was extended by one year to May 28, 2017. The $1 billion proceeds from
the NRT Loan were used to repay the remaining balance of $560 million under the
Companys $1.5 billion Bridge Facility and $440 million outstanding under the
Companys Revolving Facility. The Bridge Facility was terminated following the
repayment of the outstanding balance. The Revolving Facility can be drawn down
at any time to finance acquisitions, investments or for general corporate
purposes. The Revolving Facility was fully undrawn as of December 31, 2013.

Hudbay Transaction

777 Mine

On August 8, 2012, the Company entered into an agreement (the
777 Mine Purchase Agreement) with Hudbay Minerals Inc. (Hudbay) to acquire
100% of the life of mine silver and gold production from its currently producing
777 mine (the 777 Mine), located in Canada. Silver Wheatons share of gold
production at the 777 Mine will remain at 100% until the later of the end of
2016 or the satisfaction of a completion test relating to Hudbays Constancia
project in Perú (the Constancia Project), after which it will be reduced to
50% for the remainder of the mine life. Silver Wheaton made an upfront cash
payment of $455.1 million in September, 2012 and, in addition, will make ongoing
payments of the lesser of $5.90 per ounce of silver and $400 per ounce of gold
(both subject to an inflationary adjustment of 1% beginning in the fourth year
and subject to being increased to $9.90 per ounce of silver and $550 per ounce
of gold after the initial 40 year term) or the prevailing market price per ounce
of silver and gold delivered.Hudbay has granted Silver Wheaton a right
of first refusal on any future streaming agreement, royalty agreement or similar
transaction related to the production of silver or gold from the 777 Mine.

- 4 -

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Constancia Project (including Pampacancha)

On August 8, 2012, Silver Wheaton Caymans entered into an
agreement with Hudbay to acquire 100% of the life of mine silver production from
the Constancia Project. On November 4, 2013, Silver Wheaton Caymans amended its
agreement with Hudbay to include the acquisition of an amount equal to 50% of
the life of mine gold production from the Constancia Project. Under the amended
agreement, Silver Wheaton Caymans will pay Hudbay total cash consideration of
$429.9 million, of which $169.9 million has been paid as at December 31, 2013,
with additional payments of $125 million and $135 million to be made once
capital expenditures of $1 billion and $1.35 billion, respectively, have been
incurred at the Constancia Project. At the end of the first quarter of 2014, as
a result of capital expenditures at the Constancia Project reaching $1 billion,
the $125 million payment was made. Silver Wheaton Caymans has the option to make
the $135 million payment in either cash or by delivery of Silver Wheaton common
shares (each common share of Silver Wheaton generally referred to herein as a
Common Share), with the number of Common Shares to be issued to be calculated
based on the volume weighted average trading price of the Common Shares on the
Toronto Stock Exchange (TSX) for the ten consecutive trading days immediately
prior to the date the consideration is payable.

In addition, Silver Wheaton Caymans will make ongoing payments
of the lesser of $5.90 per ounce of silver and $400 per ounce of gold (both
subject to an inflationary adjustment of 1% beginning in the fourth year) or the
prevailing market price per ounce of silver and gold delivered.

The silver and gold production at the Constancia Project are
subject to the same completion test. The completion test requires Hudbay to
complete the Constancia Project processing plant to at least 90% of expected
throughput and silver recovery by December 31, 2016. If Hudbay fails to satisfy
the requirements of the completion test, Silver Wheaton Caymans would be
entitled to continued delivery of 100% of the gold production from Hudbays 777
Mine. If the completion test has not been satisfied by December 31, 2020, Silver
Wheaton Caymans would be entitled to a proportionate return of the upfront cash
consideration relating to the Constancia Project. In addition, Silver Wheaton
Caymans would be entitled to additional compensation in respect of the gold
stream should there be a delay in achieving completion or mining the Pampacancha
deposit (the Pampacancha Deposit) beyond the end of 2018. Hudbay has granted
Silver Wheaton Caymans a right of first refusal on any future streaming
agreement, royalty agreement, or similar transaction related to the production
of silver or gold from the Constancia Project.

Recovery rates for gold under the amended agreement have been
fixed given the early nature of the metallurgical test work on gold recoveries
from the Pampacancha Deposit. Recoveries will be set at 55% for the Constancia
Project deposit and 70% for the Pampacancha Deposit until Silver Wheaton Caymans
receives 265,000 payable ounces, after which actual recoveries will be
applied.

Early Deposit Gold Interest  Sandspring Transaction

On November 11, 2013, the Company entered into a life of mine
early deposit precious metal purchase agreement (the Early Deposit Agreement)
to acquire from Sandspring Resources Ltd. (Sandspring) an amount of gold equal
to 10% of the gold production from its Toroparu project (the Toroparu Project)
located in the Republic of Guyana, South America. The Company will pay
Sandspring total cash consideration of $148.5 million, of which $13.5 million
has been paid to date, with the additional $135 million to be payable on an
installment basis to partially fund construction of the mine. In addition, the
Company will make ongoing payments of the lesser $400 per ounce of gold (subject
to an inflationary adjustment of 1% beginning in the fourth year or satisfaction
of the completion test) or the prevailing market price per ounce of gold
delivered. Under the Early Deposit Agreement, there will be a 90 day period
following the delivery of a bankable definitive feasibility study, environmental
study and impact assessment, and other related documents (collectively, the
Feasibility Documentation), or after December 31, 2015 if the Feasibility
Documentation has not been delivered to the Company by such date, where the
Company may elect not to proceed with the precious metal purchase agreement, at
which time the Company will be entitled to a return of the early deposit of
$11.5 million (on the basis that $2 million of the advanced $13.5 million is
non-refundable) or, at Sandsprings option, the stream percentage will be
reduced from 10% to 0.774% (equivalent to the pro-rata stream based on a full
purchase price of $11.5 million).

- 5 -

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Long-Term Investments

At December 31, 2013, the Company held long-term investments
with a market value of approximately $40.8 million.

Bear Creek Mining Corporation

At December 31, 2013, Silver Wheaton owned approximately 13.3
million common shares of Bear Creek Mining Corporation (TSXV: BCM) (Bear
Creek), representing approximately 14% of the outstanding shares of Bear Creek.
At December 31, 2013, the fair value of the Companys investment in Bear Creek
was approximately $18.2 million.

Revett Minerals Inc.

At December 31, 2013, Silver Wheaton owned 5.3 million common
shares of Revett Minerals Inc. (TSX: RVM) (Revett), representing approximately
15% of the outstanding shares of Revett. At December 31, 2013, the fair value of
the Companys investment in Revett was approximately $3.8 million.

Sabina Gold & Silver Corp.

At December 31, 2013, Silver Wheaton owned 11.7 million common
shares of Sabina Gold & Silver Corp. (Sabina), representing approximately
7% of the outstanding shares of Sabina. At December 31, 2013, the fair value of
the Companys investment in Sabina was $8.0 million.

Other

At December 31, 2013, Silver Wheaton owned common shares and
common share purchase warrants of several other publicly traded mineral
exploration, development and mining companies. At December 31, 2013, the fair
value of such other long-term investments was approximately $10.7 million. As
Silver Wheatons investment represents less than 10% of the outstanding shares
of each of the respective companies and is not considered material to Silver
Wheatons overall financial position, these investments are not separately
identified in this annual information form.

DESCRIPTION OF THE BUSINESS

Silver Wheaton is a mining company which generates its revenue
primarily from the sale of silver and gold. The Company is listed on the New
York Stock Exchange (NYSE) (symbol: SLW) and the TSX (symbol: SLW).

To date, the Company has entered into 20 long-term purchase
agreements and one (1) early deposit long-term purchase agreement associated
with silver and/or gold (precious metal purchase agreements), relating to 24
different mining assets, whereby Silver Wheaton acquires silver and gold
production from the counterparties for a per ounce cash payment at or below the
prevailing market price. The primary drivers of the Companys financial results
are the volume of silver and gold production at the various mines and the price
of silver and gold realized by Silver Wheaton upon sale. Attributable silver and
gold as referred to in this annual information form is the silver and gold
production to which Silver Wheaton is entitled pursuant to the various purchase
agreements.

The Company is actively pursuing future growth opportunities,
primarily by way of entering into long-term precious metal purchase agreements.
There is no assurance, however, that any potential transaction will be
successfully completed.

- 6 -

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Principal Product

The Companys principal product is silver that it has agreed to
purchase pursuant to precious metal purchase agreements. The Company also
acquires gold that it has agreed to purchase pursuant to precious metal purchase
agreements. The following table summarizes the silver and gold interests
currently owned by the Company (collectively, the Mining Operations). Note
that statements made in this section contain forward-looking information. Please
see Cautionary Note Regarding Forward-Looking Statements for material risks,
assumptions and important disclosure associated with this information.

|                 |                 |                 |   |                 |    |  | Attributable     |   |  |         
|---------------- | --------------- | --------------- | - | --------------- | -- |  | ---------------- | - |  | --------
|                 |                 |                 |   |                 |    |  | Production to be |   |  |         
|                 |                 |                 |   |                 |    |  | Purchased        |   |  |         
|Silver and Gold  | Mine            | Location of     |   | Upfront         |    |  |                  |   |  |         
|Interests        | Owner           | Mine            |   | Consideration 1 |    |  | Silver           |   |  | Gold    
|San
      Dimas  | Primero 2       | Mexico          | $ | 189,799         |    |  | 100%             | 2 |  | 0%      
|Yauliyacu        | Glencore        | Peru            | $ | 285,000         |    |  | 100%             | 3 |  | 0%      
|Peñasquito       | Goldcorp        | Mexico          | $ | 485,000         |    |  | 25%              |   |  | 0%      
|777              | Hudbay          | Canada          | $ | 455,100         |    |  | 100%             |   |  | 100%/50%
|Salobo           | Vale            | Brazil          | $ | 1,330,000       | 5  |  | 0%               |   |  | 25%     
|Sudbury          | Vale            | Canada          | $ | 623,572         | 6  |  | 0%               |   |  | 70%     
|Barrick          |                 |                 | $ | 625,000         |    |  |                  |   |  |         
|Pascua-Lama      | Barrick         | Chile/Argentina |   |                 |    |  | 25%              |   |  | 0%      
|Lagunas Norte    | Barrick         | Peru            |   |                 |    |  | 100%             |   |  | 0%      
|Pierina          | Barrick         | Peru            |   |                 |    |  | 100%             |   |  | 0%      
|Veladero         | Barrick         | Argentina       |   |                 |    |  | 100%             | 8 |  | 0%      
|Other            |                 |                 | $ | 1,148,833       |    |  |                  |   |  |         
|Los Filos        | Goldcorp        | Mexico          | $ | 4,463           |    |  | 100%             |   |  | 0%      
|Zinkgruvan       | Lundin          | Sweden          | $ | 77,866          |    |  | 100%             |   |  | 0%      
|Stratoni         | Eldorado Gold 9 | Greece          | $ | 57,500          |    |  | 100%             |   |  | 0%      
|Minto            | Capstone        | Canada          | $ | 54,805          |    |  | 100%             |   |  | 100%    
|Cozamin          | Capstone        | Mexico          | $ | 41,959          |    |  | 100%             |   |  | 0%      
|Neves-Corvo      | Lundin          | Portugal        | $ | 35,350          |    |  | 100%             |   |  | 0%      
|Aljustrel        | I'M SGPS        | Portugal        | $ | 2,451           |    |  | 100%             |   |  | 0%      
|Mineral Park     | Mercator 11     | United States   | $ | 42,000          |    |  | 100%             |   |  | 0%      
|Campo Morado     | Nyrstar NV      | Mexico          | $ | 79,250          |    |  | 75%              |   |  | 0%      
|Keno Hill        | Alexco          | Canada          | $ | 50,000          |    |  | 25%              |   |  | 0%      
|Rosemont         | Augusta         | United States   | $ | 230,000         | 12 |  | 100%             |   |  | 100%    
|Loma de La Plata | Pan American    | Argentina       | $ | 43,289          | 13 |  | 12.5%            |   |  | 0%      
|Constancia       | Hudbay          | Peru            | $ | 429,900         | 15 |  | 100%             |   |  | 50%     
|Early Deposit    |                 |                 |   |                 |    |  |                  |   |  |         
|Toroparu         | Sandspring      | Guyana          | $ | 148,500         | 17 |  | 0%               |   |  | 10%     

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 Mines 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 (as defined below). 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 Mines
      and 50% of any excess.3)
    To a maximum of 4.75 million ounces per annum. In the
      event that silver sold and delivered to Silver Wheaton in any year totals
      less than 4.75 million ounces, the amount sold and delivered to Silver
      Wheaton in subsequent years will be increased to make up for any
      cumulative shortfall, to the extent production permits.4)
    Silver Wheaton is entitled to acquire 100% of the life of
      mine gold production from Hudbays 777 Mine until Hudbays Constancia
      Project satisfies a completion test, or the end of 2016, whichever is
      later. At that point, Silver Wheatons share of gold production from 777
      Mine will be reduced to 50% for the life of the mine.5)
    Does not include the contingent payment related to the
      Salobo Mine expansion. Vale is in the process of expanding the mill
      throughput capacity at the Salobo Mine to 24 million tonnes per annum
      ("Mtpa") from its current 12 Mtpa. If throughput capacity is expanded
      above 28 Mtpa within a predetermined period, Silver Wheaton will be
      required to make an additional payment to Vale based on a set fee schedule
      ranging from $67 million if throughput capacity is expanded to 28 Mtpa by
      January 1, 2031 up to $400 million if throughput capacity is expanded to
      40 Mtpa prior to January 1, 2021.6)
    Comprised of a $570 million upfront cash payment plus
      warrants to purchase 10 million shares of Silver Wheaton common stock at a
      strike price of $65, with a term of 10 years.7)
    Barrick (as defined below) will deliver to Silver Wheaton
      silver production from the currently producing mines until December 31,
      2016.8)
    Silver Wheaton's attributable silver production is
      subject to a maximum of 8% of the silver contained in the ore processed at
      Veladero Mine (as defined below) during the period.9)
    95% owned by Eldorado Gold Corporation.10)
    The Company is entitled to acquire 100% of the first
      30,000 ounces of gold produced per annum and 50% thereafter.11)
    On December 12, 2013, Mercator (as defined below)
      announced that they had entered a plan of arrangement with Intergeo MMC
      Ltd. to combine and create a new copper focused metals company. Mercator
      has also indicated that it is anticipated that the plan of arrangement
      transaction will be completed in the second quarter of 2014.12)
    Currently reflected as a contingent obligation, payable
      on an installment basis to partially fund construction of the Rosemont
      Project once certain milestones are achieved, including the receipt of key
      permits and securing the necessary financing to complete construction of
      the mine.13)
    Comprised of $10.9 million allocated to the silver
      interest upon the Companys acquisition of Silverstone Resources Corp. in
      addition to a contingent liability of $32.4 million, payable upon the
      satisfaction of certain conditions, including Pan American (as defined
      below) receiving all necessary permits to proceed with the mine
      construction.14)
    Definitive terms of the agreement to be
  finalized.15)
    Comprised of $169.9 million which has been paid to
      December 31, 2013, with further payments of $125 million and $135 million
      to be made once $1 billion and $1.35 billion, respectively, in capital
      expenditures have been incurred at Constancia. At the end of the first
      quarter of 2014, as a result of capital expenditures at the Constancia
      Project reaching $1 billion, the $125 million payment was made.16)
    Gold recoveries will be set at 55% for the Constancia
      Project deposit and 70% for the Pampacancha Deposit until 265,000 ounces
      of gold have been delivered to the Company.17)
    Comprised of $13.5 million paid to date in addition to
      $135 million to be payable on an installment basis to partially fund
      construction of the mine. During the 90 day period following the delivery
      of the Feasibility Documentation, or after December 31, 2015 if the
      Feasibility Documentation has not been delivered to Silver Wheaton by such
      date, Silver Wheaton may elect not to proceed with the precious metal
      purchase agreement, at which time Silver Wheaton will be entitled to a
      return of the early deposit of $11.5 million (on the basis that $2 million
      of the advanced $13.5 million is non-refundable) or, at Sandsprings
      option, the stream percentage will be reduced from 10% to 0.774%
      (equivalent to the pro-rata stream based on a full purchase price of $11.5
      million).


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Further details regarding the purchase agreements entered into
by the Company in respect of these silver and gold interests can be found under
the heading General Development of the Business  Three Year History above,
except for the following interests which were entered into prior to the past
three years:

San Dimas Transaction

On October 15, 2004, the Company entered into a silver purchase
agreement (the San Dimas Silver Purchase Agreement) with Goldcorp Inc.
(Goldcorp) to acquire an amount equal to 100% of the silver produced by
Goldcorps Luismin mining operations in Mexico (owned at the date of the
transaction) for a period of 25 years. The Luismin operations consisted
primarily of the San Dimas mines (the San Dimas Mines) and Los Filos mine (the
Los Filos Mine).

On August 6, 2010, Goldcorp completed the sale of the San Dimas
Mines to Primero Mining Corp. (Primero). In conjunction with the sale, Silver
Wheaton amended its silver purchase agreement relating to the mine. The term of
the silver purchase agreement, as it relates to San Dimas, has been extended to
the life of mine. During the first four years following the closing of the
transaction, 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. Beginning in the fifth year after
closing, 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. In addition, a per ounce cash payment of the lesser of $4.04 per ounce
of silver (subject to an annual inflationary adjustment) or the prevailing
market price is due, for silver delivered under the agreement. Goldcorp will
continue to guarantee the delivery by Primero of all silver produced and owing
to the Company until 2029. Primero has provided Silver Wheaton with a right of
first refusal on any metal stream or similar transaction it enters into.

See Further Disclosure Regarding Mineral Projects on Material
Properties  San Dimas Mines, Mexico for details regarding the San Dimas Mines.

Los Filos Transaction

Silver Wheaton has 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 Mines, Goldcorp is obligated to deliver to Silver Wheaton 1.5
million ounces of silver per annum until August 6, 2014 as noted under San
Dimas Transaction above.

Zinkgruvan Mine

On December 8, 2004, Silver Wheaton Caymans entered into an
agreement with Lundin Mining Corporation (Lundin) and Zinkgruvan Mining AB
(Zinkgruvan AB) to acquire 100% of the payable silver produced by Lundins
Zinkgruvan mining operations (the Zinkgruvan Mine) in Sweden for the life of
mine for the lesser of $3.90 per ounce of silver (subject to an annual
inflationary adjustment) and the then prevailing market price per ounce of
silver. Upfront consideration payable to Zinkgruvan AB was approximately $77.9
million.

Yauliyacu Mine

On March 23, 2006, Silver Wheaton Caymans entered into a silver
purchase agreement with Glencore International AG (Glencore) and Anani
Investments Ltd. to acquire an amount equal to 100% of the payable silver
produced from Glencores Yauliyacu mining operations (the Yauliyacu Mine) in
Perú, up to a maximum of 4.75 million ounces per year, for a period of 20 years
commencing in March of 2006, for $3.90 per ounce of silver (subject to an annual
inflationary adjustment). In the event that silver sold and delivered to Silver
Wheaton Caymans in any year totals less than 4.75 million ounces, the amount
sold to Silver Wheaton Caymans in subsequent years will be increased to make up
the cumulative shortfall, to the extent production permits. During the term of
the contract, Silver Wheaton Caymans has a right of first refusal on any future
sales of silver streams from the Yauliyacu Mine and a right of first offer on
future sales of silver streams from any other mine owned by Glencore at the time
of the initial transaction.

See Further Disclosure Regarding Mineral Projects on Material
Properties  Yauliyacu Mine, Perú for details regarding the Yauliyacu Mine.

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Peñasquito Mine

On July 24, 2007, Silver Wheaton Luxembourg entered into a
silver purchase agreement (the Peñasquito Silver Purchase Agreement) with
Goldcorp and Minera Peñasquito, S.A. de C.V. (Minera Peñasquito), a
wholly-owned subsidiary of Goldcorp, pursuant to which Silver Wheaton Luxembourg
agreed to purchase 25% of the payable silver produced by Minera Peñasquito from
the Peñasquito Mine located in Mexico (the Peñasquito Mine) over its entire
mine life, for upfront consideration of $485 million, plus a payment equal to
the lesser of $3.90 per ounce of delivered silver (subject to an annual
inflationary adjustment three years after commercial production commences) and
the then prevailing market price per ounce of silver. Silver Wheaton Luxembourg
and Silver Wheaton Caymans entered into a back to back silver purchase agreement
in respect of the Peñasquito Mine.

As stated in Goldcorps year end 2013 managements discussion
and analysis (Goldcorps MD&A), the Peñasquito Mine continued to
incrementally increase its fresh water production in 2013 from 69,500 to 77,000
cubic meters per day with the addition of eight new wells in the Torres-Vergel
area and four new wells in the mine operations area. These new wells not only
supplied water to replace the declining production in the existing well field,
but allowed water production to increase above 2012 year end levels. This
increase in water production combined with rigorous control of tailings
management and improved efficiencies in the primary crusher and augmented feed
circuit, allowed an increase in plant throughput from 99,945 tonnes per day in
2012 to 106,200 tonnes per day in 2013. The Northern Well Field project, which
will add 25 new production wells, is expected to be operational in the fourth
quarter of 2014.

As detailed in Goldcorps February 12, 2014, news release,
Goldcorp has completed a new life-of-mine plan at the Peñasquito Mine that
positively affected the 2014 and five-year production profile. As a result of
this work, proven and probable silver mineral reserves attributable to Silver
Wheaton decreased to 151.3 million ounces from 227.9 million ounces. The
decrease was a result of higher strip ratio pushbacks and the classification of
mineral reserves that require higher commodity prices to be economically
processed as mineral resources. In 2014, exploration at the Peñasquito Mine will
continue to focus on defining the high-grade core of the copper-gold,
sulphide-rich skarn mineralization located below and adjacent to current Mineral
Reserves. In addition to exploration, Goldcorp is investigating the potential
for producing a saleable copper concentrate at the Peñasquito Mine. An
additional study is also underway to assess the viability of leaching a pyrite
concentrate from the zinc flotation tailings. Successful implementation of one
or both of these new process improvements has the potential to significantly
improve the overall economics and add to the Mineral Reserves of the Peñasquito
Mine through addition of another saleable product, and increasing gold and
silver recoveries.

As per Goldcorps MD&A, in 2005, prior to construction of
the Peñasquito Mine, an agreement was negotiated with the Cerro Gordo Ejido for
the use of 600 hectares (approximately 1,483 acres) of surface land which
includes 60% of the mine pit area, the waste rock facility and explosive
magazine storage area and is located within the confines of the proposed
Peñasquito Mine site. The terms of the agreement were based on comparable
surface valuations in the region as well as on similar agreements at the
Peñasquito Mine and other Mexican mining operations. In 2009, the Cerro Gordo
Ejido commenced an action against Minera Peñasquito in Mexicos agrarian courts
challenging the land use agreement. Following a series of legal proceedings, the
agrarian courts ruled on June 18, 2013, that the land use agreement was null and
ordered the land to be returned to the Cerro Gordo Ejido for payment of 2.4
million pesos. Three separate claims are currently proceeding in the First
District Court of Zacatecas by the Cedros and Mazapil Ejidos and a local
transportation union which have resulted in the suspension of the agrarian
courts ruling, pending resolution of the three claims. The Cerro Gordo Ejido
has appealed the suspension.

Goldcorp also stated that negotiations are taking place under
the official observation of the office of the Mexican Secretary of the Economy
and Goldcorp believes that proper representatives of both parties are currently
engaged in a constructive process with a view to reaching a mutually beneficial
settlement of the land claim. Goldcorp has filed with the office of the
Secretaria De Desarrollo Agrario Territorial y Urbano (SEDATU) the required
filings to expropriate the disputed lands. In addition, Goldcorp has stated that
they will continue to employ all legal means at its disposal to ensure
continuity of operations and to protect Goldcorps mineral concession rights
consistent with Mexican law. Goldcorp notes that operations at the Peñasquito
Mine have not been impacted, however, in the event the suspensions of the
agrarian court ruling are revoked or the claims by the Ejido Cedros, Ejido
Mazapil and transportation union are ultimately rejected, Ejido Cerro Gordo
would, absent any other intervening event be entitled to possession of the Cerro
Gordo lands. Should this occur, Goldcorp states that mine operations would be
adversely impacted, with the ultimate resolution of this matter being
indeterminable at this time.

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See Further Disclosure Regarding Mineral Projects on Material
Properties - Peñasquito Mine, Mexico for details regarding the Peñasquito Mine.

Stratoni Mine

On April 23, 2007, Silver Wheaton Caymans entered into a silver
purchase agreement with European Goldfields Limited (European Goldfields),
which was acquired by Eldorado Gold Corporation on February 24, 2012, and Hellas
Gold S.A. (Hellas Gold), a 95%-owned subsidiary of European Goldfields,
pursuant to which Silver Wheaton Caymans agreed to purchase 100% of the payable
silver produced by Hellas Gold from the Stratoni mine (the Stratoni Mine)
located in Greece over its entire mine life, for an upfront cash payment of
$57.5 million, plus a payment equal to the lesser of $3.90 per ounce of
delivered silver (subject to an annual inflationary adjustment after April 23,
2010) and the then prevailing market price per ounce of silver. During the term
of the contract, Silver Wheaton Caymans has a right of first refusal on any
future sales of silver streams from any other mine owned by Hellas Gold or
European Goldfields.

Keno Hill Mines

On October 2, 2008, the Company entered into a silver purchase
agreement with Alexco Resource Corp. (Alexco) and Elsa Reclamation &
Development Company Ltd. and Alexco Keno Hill Mining Corp. (formerly called
Alexco Resource Canada Corp.), each of which are wholly-owned subsidiaries of
Alexco, pursuant to which the Company agreed to pay, subject to the completion
of certain conditions, an upfront cash payment of $50 million in order to
acquire 25% of all payable silver produced from the Keno Hill district,
including the currently producing Bellekeno mine in the Yukon Territory, Canada
(the Keno Hill Mines), over its entire mine-life, for the lesser of $3.90
(subject to an annual inflationary adjustment beginning in year four after the
achievement of specific operating targets) and the then prevailing market price
per ounce of delivered silver. Silver Wheaton is not required to contribute to
further capital or exploration expenditures and Alexco has provided a completion
guarantee with certain minimum production criteria by specific dates.

Campo Morado Mine

On May 13, 2008, Silver Wheaton Caymans entered into a silver
purchase agreement with Nyrstar Mining Ltd. (formerly called Farallon Mining
Ltd., and prior to that Farallon Resources Ltd.) (Nyrstar) and Nyrstar
Resources (Barbados) Ltd. (formerly called Farallon Resources (Barbados) Ltd.),
which are subsidiaries of Nyrstar NV as a result of Nyrstar NVs acquisition of
Farallon Mining Ltd. (as it was then named) in January 2011. Under the terms of
the silver purchase agreement, Silver Wheaton Caymans agreed to pay, subject to
the completion of certain conditions, an upfront cash payment of $80 million in
order to acquire 75% of payable silver produced by the Campo Morado property in
Mexico (the Campo Morado Mine), over its entire mine-life, for the lesser of
$3.90 (subject to an annual adjustment beginning in year four after production
commences) and the then prevailing market price per ounce of delivered silver.
The upfront payment was made on a drawdown basis to fund ongoing capital
expenditures at the Campo Morado Mine.

Mineral Park Mine

On March 17, 2008, Silver Wheaton Caymans entered into a silver
purchase agreement with Mercator Minerals Ltd. (Mercator) and Mercator
Minerals (Barbados) Ltd., a wholly-owned subsidiary of Mercator, pursuant to
which Silver Wheaton Caymans agreed to pay, subject to the completion of certain
conditions, an upfront cash payment of $42 million in order to acquire 100% of
the payable silver produced by the Mineral Park mine in the United States (the
Mineral Park Mine), over its entire mine-life, for the lesser of $3.90
(subject to an annual adjustment beginning three years after a minimum
production level has been met) and the then prevailing market price per ounce of
delivered silver. Pursuant to an amendment to the silver purchase agreement,
Mercator exercised its option to defer delivery of 50% of the required silver
deliveries for one year starting July 1, 2013. All deferred silver will be
delivered in equal installments over 18 months after the one year deferral
period. Mercator will compensate Silver Wheaton Caymans for any shortfall
arising from a decrease in the silver spot price between the time of the
original delivery date and the date of actual delivery, including a 12%
annualized interest rate. The amendment also grants Silver Wheaton a right of
first refusal on any future precious metals streams relating to the El Creston
project. On December 12, 2013, Mercator announced that they had entered a plan
of arrangement with Intergeo MMC Ltd. to combine and create a new copper focused
metals company. Mercator has indicated that it is anticipated that the plan of
arrangement transaction will complete in the second quarter of 2014.

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Pascua-Lama Project

On September 8, 2009, the Company entered into a silver
purchase agreement (the Pascua-Lama Silver Purchase Agreement) with Barrick
Gold Corporation (Barrick) pursuant to which the Company agreed to purchase an
amount of silver equivalent to 25% of the life of mine silver production from
Barricks Pascua-Lama project (the Pascua-Lama Project) located on the border
of Chile and Argentina, as well as an amount of silver equivalent to 100% of the
silver production from its Lagunas Norte mine (the Lagunas Norte Mine) and
Pierina mine (the Pierina Mine), which are both located in Perú, and its
Veladero mine (the Veladero Mine) (Silver Wheatons attributable silver
production is subject to a maximum of 8% of the silver contained in the ore
processed at the Veladero Mine during the period), which is located in
Argentina, until the end of 2013 (the Barrick Transaction). The Company will
make total upfront cash payment to Barrick of $625 million (the Upfront
Payment). In addition, per ounce cash payments of the lesser of $3.90 (subject
to an annual inflationary adjustment starting three years after achieving
project completion at Pascua-Lama) and the prevailing market price is due for
silver delivered under the Pascua-Lama Silver Purchase Agreement.

As per Barricks year end 2013 managements discussion and
analysis and annual information form, during the fourth quarter of 2013, Barrick
decided to temporarily suspend construction activities at the Pascua-Lama
Project, except those required for environmental protection and regulatory
compliance, and to place the project on care and maintenance. As disclosed by
Barrick, Barricks decision to re-start will depend on improved economics and
reduced uncertainty associated with legal and other regulatory requirements, and
that remaining development will take place in distinct stages with specific work
programs and budgets.

As part of the original agreement, Barrick provided the Company
with a completion guarantee, requiring Barrick to complete the Pascua-Lama
Project to at least 75% of design capacity by December 31, 2015, which was
subsequently extended to December 31, 2016. During 2014 and 2015, the Company
will be entitled to the silver production from the Lagunas Norte Mine, the
Pierina Mine and the Veladero Mine to the extent of any production shortfall at
the Pascua-Lama Project, until Barrick satisfies the completion test.

As a result of Barricks decision to temporarily suspend
construction activities at the Pascua-Lama Project, the Company has amended its
silver purchase agreement with Barrick. The amendment entails Silver Wheaton
being entitled to 100% of the silver production from Barricks Lagunas Norte
Mine, Pierina Mine and Veladero Mine until the end of 2016 - an extension of one
year. In addition, Silver Wheaton has agreed to extend the completion test
deadline an additional year to the end of December 31, 2017. If the requirements
of the completion test have not been satisfied by the revised outside completion
date, the agreement may be terminated by Silver Wheaton. In such an event,
Silver Wheaton will be entitled to the return of the Upfront Payment of $625
million less a credit for silver delivered up to that date. Barrick has also
granted the Company a five year right of first refusal on any further metal
stream sales in connection with the Pascua-Lama Project, where more than 50% of
the value is derived from silver.

If, after Barrick satisfies the requirements of the completion
test, certain political events occur in Argentina or Chile, including an
expropriation of any part of the Pascua-Lama Project, the selective and
discriminatory imposition of any law or war or insurrection, that results in
Barrick losing all or substantially all of the rights, privileges or benefits
pertaining to any part of the Pascua-Lama Project, then Silver Wheatons
entitlement to silver production from that part of the Pascua-Lama Project will
be suspended until the political event ceases.

If, after Barrick satisfies the requirements of the completion
test, certain political events occur in Argentina or Chile that would reduce
Barricks economic value of its investment in the Pascua-Lama Project by more
than 50%, then Silver Wheatons entitlement to silver production from the Pascua
Lama Project and the uncredited balance of the Upfront Payment will be reduced
to reflect the reduction of Barricks economic value of its investment in the
Pascua-Lama Project, until the political event ceases. If the political event
continues for the term of the transaction, then Silver Wheatons entitlement to
the repayment of the uncredited balance of the Upfront Payment will be reduced
to reflect the suspension of silver sales from the affected portion of the
Pascua-Lama Project.

If, after Barrick satisfies the requirements of the completion
test, any of Barricks subsidiaries that own any part of the Pascua-Lama Project
becomes insolvent or bankrupt, or Barricks lenders exercise or enforce any
security granted to them that results in Barrick losing all or substantially all
of the rights, privileges or benefits pertaining to the Pascua-Lama Project,
then the transaction will terminate and Silver Wheaton will be entitled to an
immediate repayment of the uncredited balance of the Upfront Payment.

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If Silver Wheaton fails to pay any portion of the Upfront
Payment to Barrick, then Barrick may terminate Silver Wheatons obligation to
make any further payments of the Upfront Payment and reduce the amount of the
Upfront Payment already paid to Barrick by the lesser of 20% of the amount
already paid or $50 million. Following any such reduction, Barrick will continue
to sell silver to Silver Wheaton in accordance with the terms of the transaction
until the amount of silver sold to Silver Wheaton equals the reduced amount of
the Upfront Payment, after which the transaction will terminate.

See Further Disclosure Regarding Mineral Projects on Material
Properties Pascua-Lama Project, Border of Chile and Argentina for details
regarding the Pascua-Lama Project.

Silverstone Acquisition

On May 21, 2009, the Company completed the acquisition of all
of the outstanding common shares of Silverstone Resources Corp. (Silverstone)
by way of a statutory plan of arrangement. Each common share of Silverstone was
exchanged for 0.185 of a Common Share, resulting in the issuance of
approximately 23.4 million Common Shares. The following interests were acquired
as a result of the acquisition of Silverstone:

Minto Mine  A precious metal purchase agreement to
acquire 100% of the silver produced from the Minto mine (the Minto Mine) in
Canada, owned by Capstone Mining Corp. (Capstone) and 100% of the first 30,000
ounces of gold produced per annum and 50% thereafter for the lesser of $3.90 per
ounce of silver and $300 per ounce of gold (subject to an annual inflationary
adjustment after three years) and the then prevailing market price per ounce of
silver or gold. If gold production from the Minto Mine exceeds 30,000 ounces per
year, the Company has committed to purchase 50% of the amount that production
exceeds those thresholds for the same per ounce payment noted above.

Cozamin Mine  A silver purchase agreement to acquire
100% of the silver produced from the Cozamin mine (the Cozamin Mine) in
Mexico, owned by Capstone until 2017 for the lesser of $4.00 (subject to an
annual inflationary adjustment after three years) and the then prevailing market
price per ounce of silver.

Neves-Corvo Mine  A silver purchase agreement to
acquire 100% of the silver produced from the Neves-Corvo mine (the Neves-Corvo
Mine) in Portugal, owned by Lundin Mining Corporation for the life of mine
(nominal term of 50 years) for the lesser of $3.90 (subject to an annual
inflationary adjustment after three years) and the then prevailing market price
per ounce of silver.

Aljustrel Mine  A silver purchase agreement to acquire
100% of the silver produced from the Aljustrel mine (the Aljustrel Mine) in
Portugal, owned by IM SGPS for the life of mine (nominal term of 50 years) for
the lesser of $3.90 (subject to an annual inflationary adjustment after three
years) and the then prevailing market price per ounce of silver.

Loma de La Plata Project  A debenture with Pan American
Silver Corp. (Pan American) (formerly with Aquiline Resources Inc.)
convertible into an agreement to purchase 12.5% of the life of mine silver
production from the Loma de La Plata (the Loma de La Plata Project) zone of
the Navidad Project in Argentina. On February 25, 2010, the Company elected to
convert the debenture with Pan American into an agreement to acquire an amount
equal to 12.5% of the life of mine silver production from the Loma de La Plata
Project. As such, Silver Wheaton will make 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. In
addition, a per ounce cash payment of the lesser of $4.00 per ounce and the
prevailing market price is due for silver delivered under the agreement. The
terms of the definitive precious metal purchase agreement continue to be
negotiated.

Rosemont Transaction

On February 10, 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 its Rosemont copper project
(the Rosemont Project) located in Pima County, Arizona. The payable rate for
silver and gold has been fixed at 92.5% of production. Silver Wheaton will make
total upfront cash payments of $230 million, payable on an instalment basis to
partially fund construction of the mine, once certain milestones are achieved,
including the receipt of key permits and securing the necessary financing to
complete construction of the Rosemont Project. In addition, a per ounce cash
payment of the lesser of $3.90 per ounce of silver and $450 per ounce of gold
(both subject to an inflationary adjustment) or the prevailing market price is
due, for silver and gold delivered under the agreement.

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Sales of Principal Product

There is a worldwide silver and gold market into which the
Company can sell the silver and gold purchased under the precious metal purchase
agreements and, as a result, the Company will not be dependent on a particular
purchaser with regard to the sale of the silver or gold that it acquires
pursuant to its precious metal purchase agreements. The silver in concentrate
from the Zinkgruvan Mine, the Stratoni Mine and the Neves-Corvo Mine and the
silver and gold from the Minto Mine is purchased from the Company by various
smelters and off-takers at the worldwide market price for silver and gold.

Competitive Conditions

The Company is the largest precious metals streaming company in
the world. The ability of the Company to acquire additional precious metals in
the future will depend on its ability to select suitable properties and enter
into similar precious metal purchase agreements. See Description of the
Business  Risk Factors  Competition.

Operations

Raw Materials

The Company purchases silver and/or gold pursuant to the
purchase agreements described under Description of the Business  Principal
Product.

Employees

Currently, the Company and its subsidiaries have an aggregate
of 30 employees.

Foreign Interests

The Company currently purchases or expects to be purchasing
silver and/or gold from mines in Mexico, the United States, Brazil, Greece,
Sweden, Perú, Chile, Argentina, Portugal and Guyana. Any changes in legislation,
regulations or shifts in political attitudes in such foreign countries are
beyond the control of the Company and may adversely affect its business. The
Company may be affected in varying degrees by such factors as government
legislation and regulations (or changes thereto) with respect to the
restrictions on production, export controls, income and other taxes,
expropriation of property, repatriation of profits, environmental legislation,
land use, water use, land claims of local people and mine safety. The effect of
these factors on the Company cannot be accurately predicted. See Description of
the Business  Risk Factors  Risks relating to the Mining Operations 
International Operations.

Risk Factors

The operations of the Company are speculative due to the nature
of its business which is the purchase of silver and/or gold production from
producing mining companies. These risk factors could materially affect the
Companys future operating results and could cause actual events to differ
materially from those described in forward-looking statements relating to the
Company. The risks described herein are not the only risks facing the Company.
Additional risks and uncertainties not currently known to the Company, or that
the Company currently deems immaterial, may also materially and adversely affect
its business.

Risks Relating to the Company

Commodity Prices

The price of the Common Shares and the Companys financial
results may be significantly adversely affected by a decline in the price of
silver or gold. The price of silver and gold fluctuates widely, especially in
recent years, and is affected by numerous factors beyond the Companys control,
including but not limited to, the sale or purchase of silver and gold by various
central banks and financial institutions, interest rates, exchange rates,
inflation or deflation, fluctuation in the value of the United States dollar and
foreign currencies, global and regional supply and demand, and the political and
economic conditions of major silver and gold producing countries throughout the
world.

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In the event that the prevailing market price of silver or gold
is at or below the price at which the Company can purchase such pursuant to the
terms of the agreements associated with its silver and gold interests, the
Company will not generate positive cash flow or earnings.

Silver and gold are by-product metals at all of the Mining
Operations, other than at the Keno Hill Mines located in Canada, the Loma de La
Plata Project located in Argentina and the Toroparu Project located in Guyana,
and therefore, the economic cut-off applied to the reporting of silver and gold
reserves and resources will be influenced by changes in the commodity prices of
other metals at the mines.

Risks Relating to the Mining Operations

To the extent that they relate to the production of silver or
gold from, or the continued operation of, the Mining Operations, the Company
will be subject to the risk factors applicable to the operators of such mines or
projects, some of which are set forth below under Risks Relating to the Mining
Operations.

No Control Over Mining Operations

The Company has agreed to purchase a certain percentage of the
silver and/or gold produced by the Mining Operations. The Company is not
directly involved in the ownership or operation of mines and has no contractual
rights relating to the operation of the Mining Operations. As a result, the cash
flows of the Company are dependent upon the activities of third parties which
creates the risk that at any time those third parties may: (i) have business
interests or targets that are inconsistent with those of the Company; (ii) take
action contrary to the Companys policies or objectives; (iii) be unable or
unwilling to fulfill their obligations under their agreements with the Company;
or (iv) experience financial, operational or other difficulties, including
insolvency, which could limit a third partys ability to perform its obligations
under the precious metal purchase agreements. Except in limited circumstances,
the Company will not be entitled to any material compensation if such operations
do not meet their forecasted silver or gold production targets in any specified
period or if the operations shut down, suspend or discontinue on a temporary or
permanent basis. There can be no assurance that the silver or gold production
from such properties will ultimately meet forecasts or targets. At any time, any
of the operators of the Mining Operations may decide to suspend or discontinue
operations.

Taxes

A significant portion of the Companys operating profit is
derived from its subsidiaries, Silver Wheaton Caymans which is incorporated and
operated in the Cayman Islands and historically, Silverstone Resources
(Barbados) Corp., which was incorporated and operated in Barbados, such that the
Companys profits are subject to low income tax.

The introduction of new tax laws or regulations, or changes to,
or differing interpretation of, or application of, existing tax laws or
regulations in Canada, the Cayman Islands, Barbados, Luxembourg, the Netherlands
or any of the countries in which the Mining Operations are located or to which
shipments of silver or gold are made, could result in an increase in the
Companys taxes, or other governmental charges, duties or impositions. Due to
the size, complexity and nature of the Companys operations, various legal and
tax matters are outstanding from time to time, including an audit by the Canada
Revenue Agency of the Companys international transactions covering the 2005 to
2010 taxation years. No assurance can be given that new tax laws or regulations
will not be enacted or that existing tax laws or regulations will not be
changed, interpreted or applied in a manner which could have a material adverse
effect on the Company.

Credit and Liquidity Risk

The Company is exposed to counterparty risks and liquidity
risks including, but not limited to: (i) through the companies with which the
Company has precious metal purchase agreements; (ii) through financial
institutions that hold the Companys cash and cash equivalents; (iii) through
companies that have payables to the Company, including concentrate customers;
(iv) through the Companys insurance providers; and (v) through the Companys
lenders. The Company is also exposed to liquidity risks in meeting its operating
expenditure requirements in instances where cash positions are unable to be
maintained or appropriate financing is unavailable. These factors may impact the
ability of the Company to obtain loans and other credit facilities in the future
and, if obtained, on terms favourable to the Company. If these risks
materialize, the Companys operations could be adversely impacted and the
trading price of the Common Shares could be adversely affected.

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Hedging Risk

The Company has a policy that permits hedging its foreign
exchange and interest rate exposures to reduce the risks associated with
currency and interest rate fluctuations. The Company also has adopted a policy
to allow the forward sale of forecast silver and gold deliveries provided that
such sales shall not extend beyond the end of a financial quarter of the
Company.

Hedging involves certain inherent risks including: (a) credit
risk - the risk that the creditworthiness of a counterparty may adversely affect
its ability to perform its payment and other obligations under its agreement
with the Company or adversely affect the financial and other terms the
counterparty is able to offer the Company; (b) market liquidity risk  the risk
that the Company has entered into a hedging position that cannot be closed out
quickly, by either liquidating such hedging instrument or by establishing an
offsetting position; and (c) unrealized fair value adjustment risk  the risk
that, in respect of certain hedging products, an adverse change in market prices
for commodities, currencies or interest rates will result in the Company
incurring losses in respect of such hedging products as a result of the hedging
products being out-of-the money on their settlement dates.

There is no assurance that a hedging program designed to reduce
the risks associated with foreign exchange/currency, interest rate or commodity
fluctuations will be successful. Although hedging may protect the Company from
adverse changes in foreign exchange/currency, interest rate or commodity
fluctuations, it may also prevent the Company from fully benefitting from
positive changes.

Competition

The Company competes with other companies for precious metal
purchase agreements and similar transactions. Some of these companies may
possess greater financial and technical resources than the Company. Such
competition may result in the Company being unable to enter into desirable
precious metal purchase agreements or similar transactions, to recruit or retain
qualified employees or to acquire the capital necessary to fund its precious
metal purchase agreements. Existing or future competition in the mining industry
could materially adversely affect the Companys prospects for entering into
additional precious metal purchase agreements in the future.

Acquisition Strategy

As part of the Companys business strategy, it has sought and
will continue to seek new exploration, mining and development opportunities in
the resource industry. In pursuit of such opportunities, the Company may fail to
select appropriate acquisition candidates or negotiate acceptable arrangements,
including arrangements to finance acquisitions or integrate the acquired
businesses and their personnel into the Company. The Company cannot assure that
it can complete any acquisition or business arrangement that it pursues, or is
pursuing, on favourable terms, or that any acquisitions or business arrangements
completed will ultimately benefit the Company.

In the event that the Company chooses to raise debt capital to
finance any acquisition, the Companys leverage will be increased. In addition,
if the Company chooses to complete an equity financing to finance any
acquisition, shareholders may suffer dilution.

In addition, the introduction of new tax laws or regulations,
or accounting rules or policies, or rating agency policies, or changes to, or
differing interpretations of, or application of, existing tax laws or
regulations or accounting rules or policies, could make precious metal purchase
agreements less attractive to counterparties. Such changes could adversely
affect the Company's ability to enter into new precious metal purchase
agreements.

Market Price of the Common Shares

The Common Shares are listed and posted for trading on the TSX
and on the NYSE. An investment in the Companys securities is highly
speculative. Securities of companies involved in the resource industry have
experienced substantial volatility in the past, often based on factors unrelated
to the financial performance or prospects of the companies involved. The price
of the Common Shares are also likely to be significantly affected by short-term
changes in silver and gold prices, the Companys financial condition or results
of operations as reflected in its quarterly earnings reports, currency exchange
fluctuations and the other risk factors identified herein.

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Equity Price Risk

The Company is exposed to equity price risk as a result of
holding long-term investments in other exploration and mining companies. Just as
investing in the Company is inherent with risks such as those set out in this
annual information form, by investing in these other companies, the Company is
exposed to the risks associated with owning equity securities and those risks
inherent in the investee companies. The Company does not actively trade these
investments.

Dividend Policy

The declaration, timing, amount and payment of dividends is at
the discretion of the Companys Board of Directors. There can be no assurance
that the Company will continue to declare a dividend on a quarterly, annual or
other basis.

Dependence Upon Key Management Personnel

The Company is dependent on the services of a small number of
key executives who are highly skilled and experienced. The loss of these persons
or the Companys inability to attract and retain additional highly skilled
employees may adversely affect its business and future operations.

Litigation

The Company is from time to time involved in various claims,
legal proceedings and disputes arising in the ordinary course of business. If
the Company is unable to resolve these disputes favourably, it may have a
material adverse impact on the Companys financial performance, cash flows or
results of operations.

The Company may fail to achieve and maintain the adequacy
of internal control over financial reporting pursuant to the requirements of the
Sarbanes-Oxley Act

The Company documented and tested during its most recent fiscal
year, its internal control procedures in order to satisfy the requirements of
Section 404 of the Sarbanes-Oxley Act (SOX). SOX requires an annual assessment
by management of the effectiveness of the Companys internal control over
financial reporting and an attestation report by the Companys independent
auditors addressing this assessment. The Company may fail to achieve and
maintain the adequacy of its internal control over financial reporting as such
standards are modified, supplemented, or amended from time to time, and the
Company may not be able to ensure that it can conclude on an ongoing basis that
it has effective internal controls over financial reporting in accordance with
Section 404 of SOX. The Companys failure to satisfy the requirements of Section
404 of SOX on an ongoing, timely basis could result in the loss of investor
confidence in the reliability of its financial statements, which in turn could
harm the Companys business and negatively impact the trading price of the
Common Shares or market value of its other securities. In addition, any failure
to implement required new or improved controls, or difficulties encountered in
their implementation, could harm the Companys operating results or cause it to
fail to meet its reporting obligations. There can be no assurance that the
Company will be able to remediate material weaknesses, if any, identified in
future periods, or maintain all of the controls necessary for continued
compliance, and there can be no assurance that the Company will be able to
retain sufficient skilled finance and accounting personnel. Future acquisitions
of companies, if any, may provide the Company with challenges in implementing
the required processes, procedures and controls in its acquired operations.
Future acquired companies, if any, may not have disclosure controls and
procedures or internal control over financing reporting that are as thorough or
effective as those required by securities laws currently applicable to the
Company.

No evaluation can provide complete assurance that the Companys
internal control over financial reporting will detect or uncover all failures of
persons within the Company to disclose material information otherwise required
to be reported. The effectiveness of the Companys control and procedures could
also be limited by simple errors or faulty judgments. In addition, as the
Company continues to expand, the challenges involved in implementing appropriate
internal controls over financial reporting will increase and will require that
the Company continue to improve its internal controls over financial reporting.
Although the Company intends to devote substantial time and incur costs, as
necessary, to ensure ongoing compliance, the Company cannot be certain that it
will be successful in complying with Section 404 of SOX.

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Risks Relating to the Mining Operations

Governmental Regulations

The Mining Operations are subject to extensive laws and
regulations governing exploration, development, production, exports, taxes,
labour standards, waste disposal, protection and remediation of the environment,
reclamation, historic and cultural resources preservation, mine safety and
occupation health, handling, storage and transportation of hazardous substances
and other matters. The costs of discovering, evaluating, planning, designing,
developing, constructing, operating and closing the Mining Operations in
compliance with such laws and regulations are significant. It is possible that
the costs and delays associated with compliance with such laws and regulations
could become such that the owners or operators of the Mining Operations would
not proceed with the development of or continue to operate a mine. Moreover, it
is possible that future regulatory developments, such as increasingly strict
environmental protection laws, regulations and enforcement policies thereunder,
and claims for damages to property and persons resulting from the Mining
Operations could result in substantial costs and liabilities for the owners or
operators of the Mining Operations in the future such that they would not
proceed with the development of, or continue to operate, a mine.

With respect to the Argentinean federal glacier protection law
and other environmental matters, see Description of the Business  Pascua-Lama
Project, Border of Chile and Argentina  Environment.

International Operations

The operations at the Luismin mines (the San Dimas Mines and
the Los Filos Mine), the Peñasquito Mine, the Campo Morado Mine and the Cozamin
Mine are conducted in Mexico, the operations at the Salobo Mine are conducted in
Brazil, the operations at the Zinkgruvan Mine are conducted in Sweden, the
operations at the Yauliyacu Mine, the Lagunas Norte Mine, the Pierina Mine and
the Constancia Project are conducted in Perú, the operations of the Stratoni
Mine are conducted in Greece, the operations at the Mineral Park Mine and the
Rosemont Project are conducted in the United States, the operations of the Keno
Hill Mines, the Minto Mine, the 777 Mine and the Sudbury Mines are conducted in
Canada, the operations of the Pascua-Lama Project are conducted in Chile and
Argentina, the operations of the Veladero Mine and the Loma de La Plata Project
are conducted in Argentina, and the operations of the Neves-Corvo Mine and the
Aljustrel Mine are conducted in Portugal, and as such the operations are all
exposed to various levels of political, economic and other risks and
uncertainties. These risks and uncertainties include, but are not limited to,
terrorism, hostage taking, military repression, crime, political instability,
currency controls, extreme fluctuations in currency exchange rates, high rates
of inflation, labour unrest, the risks of war or civil unrest, expropriation and
nationalization, renegotiation or nullification of existing concessions,
licenses, permits, approvals and contracts, illegal mining, changes in taxation
and mining laws, regulations and policies, restrictions on foreign exchange and
repatriation, and changing political conditions and governmental regulations
relating to foreign investment and the mining business. Argentina, Perú and
Greece are countries that have experienced political, social and economic unrest
in the past and protestors have from time to time targeted foreign mining firms.

Changes, if any, in mining or investment policies or shifts in
political attitude may adversely affect the operations or profitability of the
Mining Operations in these countries. Operations may be affected in varying
degrees by government regulations with respect to, but not limited to,
restrictions on production, price controls, export controls, currency
remittance, income taxes, expropriation of property, foreign investment,
maintenance of claims, environmental legislation, land use, land claims of local
people, water use, mine safety and the rewarding of contracts to local
contractors or requiring foreign contractors to employ citizens of, or purchase
supplies from, a particular jurisdiction. Failure to comply strictly with
applicable laws, regulations and local practices relating to mineral right
applications and tenure, could result in loss, reduction or expropriation of
entitlements, or the imposition of additional local or foreign parties as joint
venture partners with carried or other interests.

The occurrence of these various factors and uncertainties
cannot be accurately predicted and could have an adverse effect on the Mining
Operations.

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Exploration, Development and Operating Risks

Mining operations generally involve a high degree of risk. The
Mining Operations are subject to all the hazards and risks normally encountered
in the exploration, development and production of metals, including unusual and
unexpected geologic formations, seismic activity, rock bursts, cave-ins,
flooding, environmental hazards and the discharge of toxic chemicals, explosions
and other conditions involved in the drilling, blasting and removal of material,
any of which could result in damage to, or destruction of mines and other
producing facilities, damage to property, injury or loss of life, environmental
damage, work stoppages, delays in production, increased production costs and
possible legal liability. Milling operations are subject to hazards such as
equipment failure or failure of retaining dams around tailings disposal areas
which may result in environmental pollution and consequent liability for the
owners or operators of the Mining Operations.

The exploration for and development of mineral deposits
involves significant risks which even a combination of careful evaluation,
experience and knowledge may not eliminate. Few properties which are explored
are ultimately developed into producing mines. Major expenditures may be
required to locate and establish mineral reserves, to develop metallurgical
processes and to construct mining and processing facilities at a particular
site. It is impossible to ensure that the exploration or development programs
planned by the owners or operators of the Mining Operations will result in a
profitable commercial mining operation. Whether a mineral deposit will be
commercially viable depends on a number of factors, some of which are: the
particular attributes of the deposit, such as size, grade and proximity to
infrastructure; metal prices which are highly cyclical; government regulations,
including regulations relating to prices, taxes, royalties, land tenure, land
use, importing and exporting of minerals and environmental protection; and
political stability. The exact effect of these factors cannot be accurately
predicted. There can be no assurances that the feasibility of Mining Operations
will be established or that the Mining Operations, which are not currently in
production, will be brought into a state of commercial production.

Environmental Regulation

All phases of mining and exploration operations are subject to
governmental regulation including environmental regulation. Environmental
legislation is becoming stricter, with increased fines and penalties for
non-compliance, more stringent environmental assessments of proposed projects
and heightened responsibility for companies and their officers, directors and
employees. There can be no assurance that possible future changes in
environmental regulation will not adversely affect the Mining Operations. As
well, environmental hazards may exist on a property in which the owners or
operators of the Mining Operations hold an interest which were caused by
previous or existing owners or operators of the properties and of which such
owners or operators are not aware at present and which could impair the
commercial success, levels of production and continued feasibility and project
development and mining operations on these properties.

Permitting

The Mining Operations are subject to receiving and maintaining
permits from appropriate governmental authorities. There can be no assurance
that delays will not occur in connection with obtaining all necessary renewals
of such permits for the existing operations, additional permits for any possible
future changes to operations or additional permits associated with new
legislation. Prior to any development on any of these properties, permits from
appropriate governmental authorities may be required. There can be no assurance
that the owners or operators of the Mining Operations will continue to hold all
permits necessary to develop or continue operating at any particular property.
See Permitting, Construction, Development and Expansion Risk for additional
permitting risks associated with developmental projects.

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Compliance with Laws

Failure to comply with applicable laws, regulations and
permitting requirements may result in enforcement actions thereunder, including
orders issued by regulatory or judicial authorities causing operations to cease
or be curtailed, and may include corrective measures requiring capital
expenditures, installation of additional equipment or remedial actions. Parties
engaged in mining operations may be required to compensate those suffering loss
or damage by reason of the mining activities and may be liable for civil or
criminal fines or penalties imposed for violations of applicable laws or
regulations. Amendments to current laws, regulations and permitting
requirements, or more stringent application of existing laws, may have a
material adverse impact on the owners or operators of the Mining Operations,
resulting in increased capital expenditures or production costs, reduced levels
of production at producing properties or abandonment or delays in development of
properties.

Infrastructure

Natural resource exploration, development and mining activities
are dependent on the availability of mining, drilling and related equipment in
the particular areas where such activities are conducted. A limited supply of
such equipment or access restrictions may affect the availability of such
equipment to the owners and operators of the Mining Operations and may delay
exploration, development or extraction activities. Certain equipment may not be
immediately available, or may require long lead time orders. The lack of
availability on acceptable terms or the delay in the availability of any one or
more of these items could prevent or delay exploration, development or
production at the Mining Operations.

Mining, processing, development and exploration activities
depend, to one degree or another, on adequate infrastructure. Reliable roads,
bridges, power sources and water supply are important determinants, which affect
capital and operating costs. Unusual or infrequent weather phenomena, sabotage,
government or other interference in the maintenance or provision of such
infrastructure could adversely affect the Mining Operations.

Mineral Reserve and Mineral Resource Estimates

The reported mineral reserves and mineral resources for the
Mining Operations are only estimates. No assurance can be given that the
estimated mineral reserves and mineral resources will be recovered or that they
will be recovered at the rates estimated. Mineral reserve and mineral resource
estimates are based on limited sampling and geological interpretation, and,
consequently, are uncertain because the samples may not be representative.
Mineral reserve and mineral resource estimates may require revision (either up
or down) based on actual production experience. Market fluctuations in the price
of metals, as well as increased production costs or reduced recovery rates, may
render certain mineral reserves and mineral resources uneconomic and may
ultimately result in a restatement of estimated mineral reserves and/or mineral
resources.

Mineral resources that are not mineral reserves do not have
demonstrated economic viability. Due to the uncertainty of inferred mineral
resources, there is no assurance that inferred mineral resources will be
upgraded to proven and probable mineral reserves as a result of continued
exploration.

Need for Additional Mineral Reserves

Because mines have limited lives based primarily on proven and
probable mineral reserves, the Mining Operations must continually replace and
expand their mineral reserves as their mines produce metals. The life-of-mine
estimates for the Mining Operations may not be correct. The ability of the
owners or operators of the Mining Operations to maintain or increase their
annual production of silver or gold will be dependent in significant part on
their ability to bring new mines into production and to expand mineral reserves
at existing mines.

Land Title

No assurances can be given that there are no title defects
affecting the properties and mineral claims owned or used by the Mining
Operations. Such properties and claims may be subject to prior unregistered
liens, agreements, transfers or claims, including native land claims, and title
may be affected by, among other things, undetected defects. In addition, the
operators of such operations may be unable to operate them as permitted or to
enforce their rights with respect to their properties and claims which may
ultimately impair the ability of these operators to fulfill their obligations
under the silver and precious metal purchase agreements with the Company.

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Commodity Price Fluctuations

The price of metals has fluctuated widely in recent years, and
future serious price declines could cause continued development of and
commercial production from the Mining Operations to be impracticable. Depending
on the price of other metals produced from the mines which generate cash flow to
the owners, cash flow from the Mining Operations may not be sufficient and such
owners could be forced to discontinue production and may lose their interest in,
or may be forced to sell, some of their properties. Future production from the
Mining Operations is dependent on metal prices that are adequate to make these
properties economic.

In addition to adversely affecting the reserve estimates and
financial conditions, declining commodity prices can impact operations by
requiring a reassessment of the feasibility of a particular project. Such a
reassessment may be the result of a management decision or may be required under
financing arrangements related to a particular project. Even if the project is
ultimately determined to be economically viable, the need to conduct such a
reassessment may cause substantial delays or may interrupt operations until the
reassessment can be completed.

Additional Capital

The mining, processing, development and exploration of the
Mining Operations may require substantial additional financing. Failure to
obtain sufficient financing may result in delaying or indefinite postponement of
exploration, development or production on any or all of the Mining Operations
and related properties or even a loss of property interest. There can be no
assurance that additional capital or other types of financing will be available
if needed or that, if available, will be on satisfactory terms.

Permitting, Construction, Development and Expansion Risk

The Salobo Mine, the Peñasquito Mine, the Keno Hill Mines, the
Pascua-Lama Project, the Loma de La Plata Project, the Rosemont Project, the
Constancia Project and the Toroparu Project are currently in various stages of
permitting, construction, development and expansion. Construction, development
and expansion of such projects is subject to numerous risks, including, but not
limited to, delays in obtaining equipment, material and services essential to
completing construction of such projects in a timely manner; delays or inability
to obtain all required permits; changes in environmental or other government
regulations; currency exchange rates; labour shortages; and fluctuation in metal
prices. There can be no assurance that the operators of such projects will have
the financial, technical and operational resources to complete the permitting,
construction, development and expansion of such projects in accordance with
current expectations or at all.

TECHNICAL INFORMATION

CIM Standards Definitions

The estimated Mineral Reserves and Mineral Resources for the
Mining Operations have been calculated in accordance with the Canadian Institute
of Mining, Metallurgy and Petroleum (CIM)  Definitions adopted by CIM Council
on November 27, 2010 (the CIM Standards) or in accordance with the
Australasian Code for Reporting of Mineral Resources and Ore Reserves (the JORC
Code), the Australian worldwide standards, and were restated in accordance with
the requirements of the Canadian Securities Administrators National Instrument
43-101 Standards of Disclosure for Mineral Projects (NI 43-101) to
comply with the CIM Standards. The following definitions are reproduced from the
CIM Standards:

The term Mineral Resource is a concentration or
occurrence of diamonds, natural solid inorganic material, or natural solid
fossilized organic material including base and precious metals, coal, and
industrial minerals in or on the Earths crust in such form and quantity and of
such a grade or quality that it has reasonable prospects for economic
extraction. The location, quantity, grade, geological characteristics and
continuity of a Mineral Resource are known, estimated or interpreted from
specific geological evidence and knowledge. Mineral Resources are sub-divided,
in order of increasing geological confidence, into Inferred, Indicated and
Measured categories.

The term Inferred Mineral Resource is that part
of a Mineral Resource for which quantity and grade or quality can be estimated
on the basis of geological evidence and limited sampling and reasonably assumed,
but not verified, geological and grade continuity. The estimate is based on
limited information and sampling gathered through appropriate techniques from
locations such as outcrops, trenches, pits, workings and drill holes.

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The term Indicated Mineral Resource is that
part of a Mineral Resource for which quantity, grade or quality, densities,
shape and physical characteristics, can be estimated with a level of confidence
sufficient to allow the appropriate application of technical and economic
parameters, to support mine planning and evaluation of the economic viability of
the deposit. The estimate is based on detailed and reliable exploration and
testing information gathered through appropriate techniques from locations such
as outcrops, trenches, pits, workings and drill holes that are spaced closely
enough for geological and grade continuity to be reasonably assumed.

The term Measured Mineral Resource is that part
of a Mineral Resource for which quantity, grade or quality, densities, shape and
physical characteristics are so well established that they can be estimated with
confidence sufficient to allow the appropriate application of technical and
economic parameters, to support production planning and evaluation of the
economic viability of the deposit. The estimate is based on detailed and
reliable exploration, sampling and testing information gathered through
appropriate techniques from locations such as outcrops, trenches, pits, workings
and drill holes that are spaced closely enough to confirm both geological and
grade continuity.

The term Mineral Reserve is the economically
mineable part of a Measured or Indicated Mineral Resource demonstrated by at
least a Preliminary Feasibility Study. This study must include adequate
information on mining, processing, metallurgical, economic and other relevant
factors that demonstrate, at the time of reporting, that economic extraction can
be justified. A Mineral Reserve includes diluting materials and allowances for
losses that may occur when the material is mined.

The term Probable Mineral Reserve is the
economically mineable part of an Indicated Mineral Resource and, in some
circumstances, a Measured Mineral Resource demonstrated by at least a
Preliminary Feasibility Study. This study must include adequate information on
mining, processing, metallurgical, economic and other relevant factors that
demonstrate, at the time of reporting, that economic extraction can be
justified.

The term Proven Mineral Reserve is the
economically mineable part of a Measured Mineral Resource demonstrated by at
least a Preliminary Feasibility Study. This study must include adequate
information on mining, processing, metallurgical, economic and other relevant
factors that demonstrate, at the time of reporting, that economic extraction is
justified.

Cautionary Note to United States Investors Concerning
Estimates of Measured, Indicated and Inferred Mineral Resources

This annual information form uses the terms Measured,
Indicated and Inferred Mineral Resources. United States investors are
advised that while such terms are recognized and required by Canadian
regulations, the United States Securities and Exchange Commission does not
recognize them and expressly prohibits U.S. registered companies from including
such terms in their filings with the United States Securities and Exchange
Commission. Inferred Mineral Resources have a great amount of uncertainty as
to their existence, and as to their economic and legal feasibility. It cannot be
assumed that all or any part of an Inferred Mineral Resource will ever be
upgraded to a higher category. Under Canadian rules, estimates of Inferred
Mineral Resources may not form the basis of feasibility or other economic
studies. United States investors are cautioned not to assume that all or any
part of Measured or Indicated Mineral Resources will ever be converted into
Mineral Reserves. United States investors are also cautioned not to assume that
all or any part of an Inferred Mineral Resource exists, or is economically or
legally mineable.

Summary of Mineral Reserves and Mineral Resources

The following tables set forth the estimated Mineral Reserves
and Mineral Resources (silver and/or gold only) for the mines relating to which
the Company has purchase agreements, adjusted where applicable to reflect the
Companys percentage entitlement to silver and/or gold produced from such mines,
as of December 31, 2013, unless otherwise noted. The tables are 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:

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Attributable Proven and Probable Reserves(1,2,3,8,18)As of December 31, 2013 unlessotherwise noted (6)

|                       |  | Proven  |  |  | Probable |  |  | Proven & Probable |  |  |         | 
|---------------------- |  | ------- |  |  | -------- |  |  | ----------------- |  |  | ------- | 
|                       |  |         |  |  |          |  |  |                   |  |  |         | 
|                       |  | Tonnage |  |  | Grade    |  |  | Contained         |  |  | Tonnage | 
|                       |  | Mt      |  |  | g/t      |  |  | Moz               |  |  | Mt      | 
|Silver                 |  |         |  |  |          |  |  |                   |  |  |         | 
|Peñasquito (25%) (14)  |  |         |  |  |          |  |  |                   |  |  |         | 
|Mill                   |  | 83.8    |  |  | 34.7     |  |  | 93.4              |  |  | 48.7    | 
|Heap Leach             |  | 10.5    |  |  | 32.7     |  |  | 11.0              |  |  | 10.4    | 
|San Dimas (10,14)      |  | 0.9     |  |  | 345.2    |  |  | 10.3              |  |  | 4.0     | 
|Pascua-Lama (25%) (14) |  | 8.0     |  |  | 69.8     |  |  | 17.9              |  |  | 73.2    | 
|Lagunas Norte (11)     |  | 9.8     |  |  | 3.8      |  |  | 1.2               |  |  | 52.1    | 
|Veladero (11)          |  | 7.3     |  |  | 14.3     |  |  | 3.4               |  |  | 92.0    | 
|Yauliyacu (11,12)      |  | 1.1     |  |  | 106.0    |  |  | 3.6               |  |  | 3.3     | 
|777 (13,14)            |  | 4.9     |  |  | 24.7     |  |  | 3.9               |  |  | 5.7     | 
|Neves-Corvo            |  |         |  |  |          |  |  |                   |  |  |         | 
|Copper                 |  | 5.8     |  |  | 41.0     |  |  | 7.7               |  |  | 21.2    | 
|Zinc                   |  | 10.7    |  |  | 74.0     |  |  | 25.5              |  |  | 12.6    | 
|Rosemont (15)          |  | 279.5   |  |  | 4.1      |  |  | 37.0              |  |  | 325.8   | 
|Constancia             |  | 506.0   |  |  | 3.1      |  |  | 50.3              |  |  | 114.0   | 
|Mineral Park (15)      |  | 189.5   |  |  | 2.8      |  |  | 16.9              |  |  | 145.2   | 
|Zinkgruvan             |  |         |  |  |          |  |  |                   |  |  |         | 
|Zinc                   |  | 8.5     |  |  | 86.0     |  |  | 23.5              |  |  | 3.3     | 
|Copper                 |  | 3.8     |  |  | 31.0     |  |  | 3.8               |  |  | 0.1     | 
|Aljustrel              |  |         |  |  |          |  |  |                   |  |  |         | 
|Copper                 |  | 2.2     |  |  | 19.2     |  |  | 1.3               |  |  | 8.4     | 
|Campo Morado (75%)     |  | 0.8     |  |  | 158.2    |  |  | 4.0               |  |  | 0.2     | 
|Stratoni               |  | 0.8     |  |  | 172.0    |  |  | 4.2               |  |  | 0.4     | 
|Minto                  |  | 3.8     |  |  | 5.9      |  |  | 0.7               |  |  | 5.7     | 
|Cozamin(11)            |  |         |  |  |          |  |  |                   |  |  |         | 
|Copper                 |  | 1.0     |  |  | 60.0     |  |  | 2.0               |  |  | 2.9     | 
|Los
      Filos        |  | 67.2    |  |  | 5.6      |  |  | 12.2              |  |  | 243.2   | 
|Total Silver           |  |         |  |  |          |  |  | 333.7             |  |  |         | 
|Gold                   |  |         |  |  |          |  |  |                   |  |  |         | 
|Salobo (25%) (16)      |  | 160.4   |  |  | 0.41     |  |  | 2.12              |  |  | 123.7   | 
|Sudbury (70%) (11)     |  | 33.9    |  |  | 0.38     |  |  | 0.41              |  |  | 31.7    | 
|777 (13,14)            |  | 3.5     |  |  | 1.81     |  |  | 0.21              |  |  | 4.1     | 
|Constancia (50%)       |  | 253.0   |  |  | 0.05     |  |  | 0.42              |  |  | 57.0    | 
|Minto                  |  | 3.8     |  |  | 0.80     |  |  | 0.10              |  |  | 5.7     | 
|Toroparu (10%) (17)    |  | 3.0     |  |  | 1.10     |  |  | 0.10              |  |  | 9.7     | 
|Total Gold             |  |         |  |  |          |  |  | 3.36              |  |  |         | 

See Notes Below.

- 22 -

---

Attributable Measured & Indicated Resources(1,2,3,4,5,9,18)As of December 31, 2013 unlessotherwise noted (6)

|                               |  | Measured |  |  | Indicated |  |  | Measured & Indicated | 
|------------------------------ |  | -------- |  |  | --------- |  |  | -------------------- | 
|                               |  | Tonnage  |  |  | Grade     |  |  | Contained            | 
|                               |  | Mt       |  |  | g/t       |  |  | Moz                  | 
|Silver                         |  |          |  |  |           |  |  |                      | 
|Peñasquito (25%) (14)          |  |          |  |  |           |  |  |                      | 
|Mill                           |  | 8.1      |  |  | 23.5      |  |  | 6.1                  | 
|Heap Leach                     |  | 0.1      |  |  | 11.1      |  |  | 0.02                 | 
|Pascua-Lama (25%) (14)         |  | 3.7      |  |  | 26.4      |  |  | 3.1                  | 
|Yauliyacu (11,12)              |  | 0.7      |  |  | 120.4     |  |  | 2.6                  | 
|Neves-Corvo                    |  |          |  |  |           |  |  |                      | 
|Copper                         |  | 4.8      |  |  | 49.4      |  |  | 7.7                  | 
|Zinc                           |  | 13.3     |  |  | 60.5      |  |  | 25.9                 | 
|Rosemont (15)                  |  | 38.5     |  |  | 3.0       |  |  | 3.7                  | 
|Constancia                     |  | 73.0     |  |  | 2.4       |  |  | 5.6                  | 
|Mineral Park (15)              |  | -        |  |  | -         |  |  | -                    | 
|Zinkgruvan                     |  |          |  |  |           |  |  |                      | 
|Zinc                           |  | 0.7      |  |  | 146.4     |  |  | 3.5                  | 
|Copper                         |  | 1.4      |  |  | 23.3      |  |  | 1.0                  | 
|Aljustrel                      |  |          |  |  |           |  |  |                      | 
|Zinc                           |  | 1.3      |  |  | 65.6      |  |  | 2.7                  | 
|Copper                         |  | -        |  |  | -         |  |  | -                    | 
|Campo Morado (75%)             |  | 5.0      |  |  | 128.9     |  |  | 20.6                 | 
|Stratoni                       |  | 0.2      |  |  | 213.9     |  |  | 1.1                  | 
|Minto                          |  | 7.5      |  |  | 3.6       |  |  | 0.9                  | 
|Keno Hill (25%)                |  |          |  |  |           |  |  |                      | 
|Underground                    |  | -        |  |  | -         |  |  | -                    | 
|Elsa Tailings                  |  | -        |  |  | -         |  |  | -                    | 
|Los Filos                      |  | 9.9      |  |  | 11.5      |  |  | 3.6                  | 
|Loma
      de La Plata (12.5%) |  | -        |  |  | -         |  |  | -                    | 
|Total Silver                   |  |          |  |  |           |  |  | 88.1                 | 
|Gold                           |  |          |  |  |           |  |  |                      | 
|Salobo (25%) (16)              |  | 12.3     |  |  | 0.47      |  |  | 0.19                 | 
|Sudbury (70%) (11)             |  | -        |  |  | -         |  |  | -                    | 
|Constancia (50%)               |  | 36.5     |  |  | 0.05      |  |  | 0.06                 | 
|Minto                          |  | 7.5      |  |  | 0.42      |  |  | 0.10                 | 
|Toroparu (10%) (17)            |  | 0.9      |  |  | 0.87      |  |  | 0.03                 | 
|Total Gold                     |  |          |  |  |           |  |  | 0.37                 | 

See Notes Below.

- 23 -

---

Attributable Inferred Resources(1,2,3,4,5,9,18)As of December 31, 2013
unlessotherwise noted(6)

InferredTonnage
    
    
    Grade
    
    
    ContainedMt
    
    
    g/t
    
    
    MozSilverPeñasquito (25%) (14)Mill
    
    10.2
    
    
    30.8
    
    
    10.1Heap Leach
    
    0.4
    
    
    14.5
    
    
    0.2San Dimas (10,14)
    
    7.3
    
    
    309.5
    
    
    73.0Pascua-Lama (25%) (14)
    
    4.9
    
    
    20.1
    
    
    3.2Yauliyacu (11, 12)
    
    5.8
    
    
    180.8
    
    
    33.5777 (13, 14)
    
    0.8
    
    
    30.6
    
    
    0.8Neves-CorvoCopper
    
    24.7
    
    
    44.7
    
    
    35.5Zinc
    
    22.5
    
    
    51.0
    
    
    36.9Rosemont (15)
    
    104.5
    
    
    3.3
    
    
    11.1Constancia
    
    200.0
    
    
    1.9
    
    
    12.0Mineral Park (15)
    
    362.2
    
    
    2.7
    
    
    31.1ZinkgruvanZinc
    
    5.0
    
    
    83.0
    
    
    13.3Copper
    
    0.6
    
    
    34.0
    
    
    0.7AljustrelZinc
    
    8.7
    
    
    50.4
    
    
    14.0Copper
    
    4.7
    
    
    16.0
    
    
    2.4Campo Morado (75%)
    
    1.7
    
    
    128.9
    
    
    7.1Stratoni
    
    0.5
    
    
    169.0
    
    
    2.7Minto
    
    16.2
    
    
    3.2
    
    
    1.7Keno Hill (25%)Underground
    
    0.2
    
    
    368.9
    
    
    2.5Los Filos
    
    191.7
    
    
    6.0
    
    
    36.8Loma
      de La Plata (12.5%)
    
    0.2
    
    
    76.0
    
    
    0.4Total Silver
    
    
    
    
    
    
    
    328.8GoldSalobo (25%) (16)
    
    37.0
    
    
    0.31
    
    
    0.37Sudbury (70%) (11)
    
    7.2
    
    
    0.27
    
    
    0.06777 (13, 14)
    
    0.4
    
    
    1.77
    
    
    0.02Constancia (50%)
    
    100.0
    
    
    0.03
    
    
    0.10Minto
    
    16.2
    
    
    0.30
    
    
    0.16Toroparu (10%) (17)
    
    13.0
    
    
    0.74
    
    
    0.31Total Gold
    
    
    
    
    
    
    
    1.02


|(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 technical information contained in this document
      (including the Mineral Reserve and Mineral Resource estimates) for the
      following operations are as follows:

| | a. | Salobo Mine  Christopher Jacobs, CEng MIMMM (Vice
      President and Mining Economist), James Turner, CEng MIMMM (Senior Mineral
      Process Engineer), Barnard Foo, P. Eng., M. Eng, MBA (Senior Mining
      Engineer) and Jason Ché Osmond, FGS, C.Geol, EurGeol (Senior Geologist)
      all of whom are employees of Micon International Ltd.
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | b. | All other operations and development projects: the
      Companys QPs Neil Burns, M.Sc., P.Geo. (Vice President, Technical
      Services); Samuel Mah, M.A.Sc., P.Eng. (Senior Director, Project
      Evaluations), 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 Mine, Campo Morado Mine,
      Neves-Corvo Mine, Zinkgruvan Mine and Aljustrel Mine 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, 2013 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.                                                                                                                          

| | a. | Mineral Resources and Mineral Reserves for Campo Morados
      G-9 Mine are reported as of December 31, 2012.                                                                                                       
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | b. | Mineral Resources and Mineral Reserves for Toroparu
      Project are reported as of March 31, 2013.                                                                                                                 
| | c. | Mineral Resources and Mineral Reserves for Neves-Corvo
      Mine and Zinkgruvan Mine are reported as of June 30, 2013.                                                                                              
| | d. | Mineral Resources and Mineral Reserves for Mineral Park
      Mine are reported as of June 1, 2013.                                                                                                                  
| | e. | Mineral Resources and Mineral Reserves for Rosemont
      Project are reported as of August 28, 2012.                                                                                                                
| | f. | Mineral Resources for the Constancia Project (including
      Pampacancha Deposit) are reported as of September 30, 2013.                                                                                            
| | g. | Mineral Resources and Mineral Reserves for Aljustrels
      Feitais and Moinho mines are reported as of November 30, 2010. Mineral
      Resources for the Estaçao project are reported as of December 31,
    2007.

- 24 -

---

| | h. | Mineral Resources for Campo Morados El Largo, El Rey,
      Naranjo and Reforma projects are reported as of October 13,
2005.                                                                                                                                                                                                                                                                          
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | i. | Mineral Resources for Keno Hills Elsa Tailings project
      are reported as of April 22, 2010, Lucky Queen and Onek projects as of
      July 27, 2011, Bermingham project as of June 27, 2012, Flame and Moth
      project as of January 30, 2013, Bellekeno mine Inferred Mineral Resources
      as of May 31, 2012 and Bellekeno mine Indicated Mineral Resources as of
      September 30, 2013.
| | j. | Mineral Resources for Loma de La Plata Project are
      reported as of May 20, 2009.                                                                                                                                                                                                                                                                                                                   

|(7) | Process recoveries are the average percentage of silver
      or gold 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 the following commodity
prices:                                                                                                       

| | a. | Peñasquito Mine - $1,300 per ounce gold, $22 per ounce
      silver $3.00 per pound copper, $0.90 per pound lead and $0.90 per pound
      zinc.                                                 
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | b. | San Dimas Mines  2.7 grams per tonne gold equivalent
      cut-off assuming $1,250 per gold ounce and $20.00 per ounce
  silver.                                                                
| | c. | Pascua-Lama Project, Lagunas Norte and Veladero mines -
      $1,100 per ounce gold, $21.00 per ounce silver and $3.00 per pound
      copper.                                                   
| | d. | Yauliyacu Mine - $22.00 per ounce silver, $3.27 per pound
      copper, $0.98 per pound lead and $0.91 per pound zinc.                                                                           
| | e. | 777 Mine  $1,250 per ounce gold, $25.00 per ounce
      silver, $3.00 per pound copper and $1.06 per pound zinc.                                                                                
| | f. | Neves-Corvo Mine  1.6% copper cut-off for the copper
      Reserve and 4.8% zinc cut-off for all the zinc Reserves.                                                                             
| | g. | Rosemont Project - $4.90 per ton NSR cut-off assuming
      $20.00 per ounce silver, $2.50 per pound copper and $15.00 per pound
      molybdenum.                                               
| | h. | Constancia Project - $1,250 per gold ounce, $25.00 per
      ounce silver, $3.00 per pound copper and $14.00 per pound
    molybdenum.                                                           
| | i. | Mineral Park Mine  0.21% copper equivalent cut-off
      assuming $3.90 per ounce silver, $2.60 per pound copper and $9.95 per
      pound molybdenum.                                          
| | j. | Zinkgruvan Mine  3.8% zinc equivalent cut-off for the
      zinc Reserve assuming $2.50 per pound copper and $1.00 per pound lead and
      zinc and 1.5% copper cut-off for the copper Reserve.
| | k. | Aljustrel Mine  1.5% copper cut-off for all copper
      Reserves, 4.5% zinc cut-off for all zinc Reserves.                                                                                     
| | l. | Campo Morado Mine - $18.92 per ounce silver.                                                                                                                                                     
| | m. | Stratoni Mine  16.85% zinc equivalent assuming $1,250
      per ounce gold, $16.50 per ounce silver, $3.00 per pound copper, $0.95 per
      pound lead and $0.86 per pound zinc.               
| | n. | Minto Mine  0.5% copper cut-off for Open Pit and $64.4
      per tonne NSR cut-off for Underground assuming $300 per ounce gold, $3.90
      per ounce silver and $2.50 per pound copper.       
| | o. | Cozamin Mine - $40 per tonne NSR cut-off assuming $20.00
      per ounce silver, $2.50 per pound copper, $0.85 per pound lead and $0.80
      per pound zinc.                                    
| | p. | Los Filos Mine - $1,300 per ounce gold and $22.00 per
      ounce silver.                                                                                                                        
| | q. | Salobo Mine  0.249% copper equivalent cut-off assuming
      $1,200 per ounce gold and $3.45 per pound copper.                                                                                  
| | r. | Sudbury Mines - $1,543 per ounce gold, $8.34 per pound
      nickel, $3.64 per pound copper, $1,590 per ounce platinum, $718 per ounce
      palladium and $13.75 per pound cobalt.              
| | s. | Toroparu Project - $1,070 per ounce gold for fresh rock
      and $970 per ounce gold for saprolite.                                                                                             

|(9) | Mineral Resources are estimated using appropriate
      recovery rates and the following commodity
prices:
|--- | ----------------------------------------------------------------------------------------------------------

| | a. | Peñasquito Mine - $1,500 per ounce gold, $24.00 per ounce
      silver, $3.50 per pound copper, $1.00 per pound lead and $1.00 per pound
      zinc.                                                      
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | b. | San Dimas Mines  0.2 grams per tonne gold equivalent
      assuming $1,300 per ounce gold and $20.00 per ounce silver.                                                                                   
| | c. | Pascua-Lama Project  $1,500 per ounce gold, $24.00 per
      ounce silver and $3.50 per pound copper.                                                                                                    
| | d. | Yauliyacu Mine  $30.00 per ounce silver.                                                                                                                                                                 
| | e. | 777 Mine  $1,250 per ounce gold, $25.00 per ounce
      silver, $3.00 per pound copper and $1.06 per pound zinc.                                                                                         
| | f. | Neves-Corvo Mine  1.0% copper cut-off for the copper
      Resource and 3.0% zinc cut-off for the zinc Resource.                                                                                         
| | g. | Rosemont Project  0.30% copper equivalent cut-off for
      Mixed and 0.15% copper equivalent for Sulfide assuming $20.00 per ounce
      silver, $2.50 per pound copper and $15.00 per pound molybdenum.
| | h. | Constancia Project  0.12% copper cut-off for Constancia
      and 0.10% copper cut-off for Pampacancha.                                                                                                  
| | i. | Mineral Park Mine  0.126% copper equivalent assuming
      $3.90 per ounce silver, $3.66 per pound copper and $13.65 per pound
      molybdenum.                                                         
| | j. | Zinkgruvan Mine  3.8% zinc equivalent cut-off for the
      zinc Resource assuming $2.50 per pound copper and $1.00 per pound lead and
      zinc and 1.0% copper cut-off for the copper Resource.       
| | k. | Aljustrel Mine  1.5% copper cut-off for all copper
      Resources, 4.5% zinc cut-off for Feitais and Moinho mines zinc Resources
      and 4.0% for Estação zinc Resources.                             
| | l. | Campo Morado Mine  $18.92 per ounce silver for the G-9
      zones and 5% zinc cut-off for the El Rey, Naranjo and Reforma
    projects.                                                                 
| | m. | Stratoni Mine - $1,250 per ounce gold, $16.50 per ounce
      silver, $3.00 per pound copper, $0.95 per pound lead and $0.86 per pound
      zinc.                                                        
| | n. | Minto Mine  0.5% copper cut-off.                                                                                                                                                                         
| | o. | Cozamin Mine  $35 per tonne NSR cut-off assuming $20.00
      per ounce silver, $2.50 per pound copper, $0.85 per pound lead and $0.80
      per pound zinc.                                             
| | p. | Keno Hill Mines:                                                                                                                                                                                          

| | i.   | Bellekeno mine and Flame and Moth projects - $185 per
      tonne NSR cut-off assuming $1,400 per ounce gold, $22.50 per ounce silver,
      $0.95 per ounce lead and $0.85 per ounce zinc.
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | ii.  | Bermingham project - $185 per tonne NSR cut-off assuming
      $1,350 per ounce gold, $23.00 per ounce silver, $0.95 per pound lead and
      $0.85 per pound zinc.                        
| | iii. | Lucky Queen and Onek projects - $185 per tonne NSR
      cut-off assuming $1,100 per ounce gold, $18.50 per ounce silver, $0.95 per
      pound lead and $0.90 per pound zinc.             
| | iv.  | Elsa Tailings project  50 grams per tonne silver
      cut-off.                                                                                                                           

- 25 -

---

| | q. | Los Filos Mine - $1,500 per ounce gold and $24.00 per
      ounce silver.                                                                                                          
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | r. | Loma de La Plata Project  $12.50 per ounce silver and
      $0.50 per pound lead.                                                                                                 
| | s. | Salobo Mine  0.296% copper equivalent assuming $1,500
      per ounce gold $3.67 per pound copper.                                                                                
| | t. | Sudbury Mines - $1,590 per ounce gold, $8.34 per pound
      nickel, $3.64 per pound copper, $1,590 per ounce platinum, $718 per ounce
      palladium and $13.75 per pound cobalt.
| | u. | Toroparu Project - $1,350 per ounce
  gold.                                                                                                                                        

|(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 Mines 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 Mines and 50% of any
      excess, for the life of the mine.
|---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(11) | The Companys attributable Mineral Resources and Mineral
      Reserves for Lagunas Norte Mine, Veladero Mine, Cozamin Mine and Yauliyacu
      silver interests, in addition to the Sudbury Mines and 777 Mine gold
      interests, have been constrained to the production expected for the
      various contracts.                                                                                                                                                                                                                                                                                                                                
|(12) | The Companys Yauliyacu silver purchase agreement (March
      2006) with Glencore provides for the delivery of up to 4.75 million ounces
      of silver per year for 20 years. In the event that silver sold and
      delivered to Silver Wheaton in any year totals less than 4.75 million
      ounces, the amount sold and delivered to Silver Wheaton in subsequent
      years will be increased to make up for any cumulative shortfall, to the
      extent production permits. Depending upon production levels it is possible
      that the Companys current attributable tonnage may not be mined before
      the agreement expires.   
|(13) | The 777 Purchase Agreement provides that Hudbay will
      deliver 100% of the payable silver for the life of the mine and 100% of
      the payable gold until completion of the Constancia Project, after which
      the gold stream will reduce to 50%. The gold figures in this table
      represent the attributable 777 Mine Mineral Resources and Mineral Reserves
      constrained to the production expected for the 777 Purchase
    Agreement.                                                                                                                                                                                           
|(14) | The scientific and technical information in this document
      regarding Peñasquito Mine, San Dimas Mines and Pascua-Lama Project was
      sourced by the Company from the following SEDAR (www.sedar.com) filed
      documents:                                                                                                                                                                                                                                                                                                                                                                                                                    

| | a. | Peñasquito - Goldcorp annual information Form filed
      on March 31,2014;            
| | -- | ---------------------------------------------------------------------------------------
| | b. | San Dimas - Primero annual information Form filed on
      March 31, 2014; and         
| | c. | Pascua-Lama - Barrick Gold Corp. annual information Form
      filed on March 31, 2014.

|     | The Company QPs have approved the disclosure of
      scientific and technical information in respect of Peñasquito Mine, San
      Dimas Mines and Pascua- Lama Project in this document.                                                                                                                                                                                                                              
|---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(15) | The Mineral Park and Rosemont Resources and Reserves do
      not include the SX/EW leach material since this process does not recover
      silver.                                                                                                                                                                                                                                                                     
|(16) | The Company has filed a technical report for the Salobo
      Mine, which is available on SEDAR at www.sedar.com.                                                                                                                                                                                                                                                                                                        
|(17) | The Companys agreement with Sandspring is an early
      deposit structure whereby the Company will have the option to secure a 10%
      gold stream on the Toroparu Project following the delivery of a bankable
      definitive feasibility study.                                                                                                                                                                  
|(18) | Silver and gold are produced as by-product metal at all
      operations with the exception of silver at the Keno Hill Mines and Loma de
      La Plata Project and gold at the Toroparu Project; therefore, the economic
      cut-off applied to the reporting of silver and gold Mineral Resources and
      Mineral Reserves will be influenced by changes in the commodity prices of
      other metals at the time.

- 26 -

---

FURTHER DISCLOSURE REGARDING MINERAL PROJECTS ON MATERIAL
PROPERTIES

SAN DIMAS MINES, MEXICO

The following description of the San Dimas Mines is based on
the information disclosed in the annual information form of Primero filed
on March 31, 2014. The Company QPs have approved the disclosure of scientific
and technical information in respect of the San Dimas Mines in this document.

Property Description and Location

The San Dimas Mines are located on the borders of the Durango
and Sinaloa states, approximately 125 km northeast of Mazatlan, Sinaloa and 150
kilometres west of the city of Durango, Durango, in Mexico. The property is
centered on latitude 24°06N and longitude 105°56W.

The San Dimas Mines property consists of 66 contiguous
concessions covering 24,966 hectares, having expiry dates ranging from 2019 to
2060. As per Mexican requirements for grant of tenure, the concessions
comprising the San Dimas Mines have been surveyed on the ground by a licensed
surveyor. All appropriate payments have been made to the relevant authorities
and the licenses are in good standing. Primero has secured surface rights by
either acquisition of private and public land or by entering into temporary
occupation agreements with surrounding communities.

In 2013, the Mexican federal government introduced a mining
royalty, effective January 1, 2014, based on 7.5% of taxable earnings before
interest and depreciation. In addition, precious metals mining companies must
pay a 0.5% royalty on revenues from gold, silver and platinum.

Primero holds the appropriate permits under local, State and
Federal laws to allow mining operations at San Dimas. The main environmental
permit is the Licencia Ambiental Unica under which the mine operates its
industrial facilities. The mine and mill expansion of the San Dimas Mines is
also covered by this permit. Other significant permits are those related to
water supply and water discharge rights. A waste pad project commenced in 2013
for which both the environmental impact study and the technical justification
were approved by the Secretaria de Medio Ambiente y Recursos Naturales and the
Mexican environmental protection agency. In addition, permits were received from
the Commssión Nacional de Agua regarding the Piaxtla River diversion that is
part of this waste pad project. As of March 2014, the rivers course has been
diverted through the new canal and the aquative life recovery had been achieved.
The new waste pad is not operational yet but will be activated later on in 2014.

Accessibility, Climate, Local Resources, Infrastructure
and Physiography

Access

Access to the San Dimas area is by air or road from the city of
Durango. By road the trip requires approximately ten hours. Primero maintains a
de Havilland Twin Otter aircraft and a helicopter, both of which are based at
Tayoltita. Travel from either Mazatlan or Durango to Tayoltita requires an
approximate half hour flight in the Twin Otter aircraft. Most of the personnel
and light supplies for the San Dimas Mines arrive on Primeros regular flights
from Mazatlan and Durango. Heavy equipment and supplies are brought in by road
from Durango.

Climate

The climate of the San Dimas area is semi-tropical,
characterized by relatively high temperatures and humidity, with hot summers
(maximum about 35 degrees Celsius) and mild winters. At higher elevations in the
Sierra, frosty nights occur in the winter (November to March). The majority of
the precipitation occurs in the summer (June through September); however,
tropical rainstorms during October to January can result in considerable
additional rainfall. The total average annual rainfall varies from about 66 to
108 centimetres. Weather does not affect the operations and mining is carried
out throughout the year.

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Local Resources and Infrastructure

Mining at the San Dimas Mines is done by a mixture of contract mining and Primero personnel. Tayoltita is the most important population centre in the region with approximately 8,000 inhabitants, including mining personnel, and the population outside
of this centre is sparse. Subsistence farming, ranching, mining and timber cutting are the predominant activities of the region’s population.

Water for the mining operations is obtained from wells and from the Piaxtla River. Water is also supplied by Primero to the town of Tayoltita from an underground thermal spring at the Santa Rita mine.

Electrical power is provided by a combination of Primero’s own hydro generation system – Las Truchas – and the Federal Power Commission Supply System (the “FPCSS”). Primero operates hydroelectric and back-up diesel
generators, which are interconnected with the FPCSS.  Las Truchas provides about 75 percent of the total requirement of the San Dimas Mines during nine months of the year. During the remaining three months of the year, corresponding to the dry
season, the power for operations at San Dimas is mainly supplied by the FPCSS. Primero is currently expanding the power generation of the Las Truchas facility from 50 gigawatts to 75 gigawatts.

The main infrastructure of the San Dimas district consists of roads, a townsite, an airport, the crushing and processing facilities of the Tayoltita mill, the old San Antonio mill, the Tayoltita/Cupias and San Antonio tailings facilities, the Las
Truchas hydro generation facilities, a diesel power plant and the San Dimas Mines, which are divided into five blocks: West Block (San Antonio mine), Sinaloa Graben Block, Central Block, and the Tayoltita and Arana Blocks (Santa Rita mine). The San
Antonio mill and tailings facilities are currently under reclamation. Primero holds sufficient surface rights to support the San Dimas mine operations, and associated infrastructure. Environmental permits are required from various federal,
provincial, and municipal agencies, and are in place for all current operations.  No new permits are currently required for current exploration activity and mining operations, but existing permit amendments are required from time to time.

Physiography and Vegetation

The San Dimas district is located in the central part of the Sierra Madre Occidental, a mountain range characterized by very rugged topography with steep, often vertical walled valleys and narrow canyons. Elevations vary from 2,400 metres above mean
sea level (“amsl”) on the high peaks to elevations of 400 metres amsl in the valley floor of the Piaxtla River. Vegetation is dominated by pines, junipers and, to a lesser extent, oaks at higher elevations while lower slopes and valleys
are covered with thick brush, cacti and grass.

History

Prior Ownership

The San Dimas property contains a series of epithermal gold silver veins that have been mined intermittently since 1757. Modern mining began in the 1880s, when the American San Luis Mining Company acquired the Tayoltita mine and American Colonel
Daniel Burns took control of the Candelaria mine and began working in the area, and has continued under different owners to the present.  By 1940, the San Luis Mining Company had acquired the Candelaria and the Contraestaca mines.

A mining law introduced in 1959 in Mexico required the majority of a Mexican mining company to be held by a Mexican entity and forced the sale of 51 percent of the shares of the San Luis Mining Company to Mexicans. In 1961, the Minas de San Luis
S.A. de C.V. was formed and assumed operations of the mine.  In 1978, the remaining 49 percent interest was obtained by Luismin S.A. de C.V (“Luismin”).

In 2002, Wheaton River Minerals Ltd. (“Wheaton River”) acquired the property and, in 2005, Wheaton River merged with Goldcorp. Through its wholly-owned subsidiary, Primero Empresa, Primero acquired the San Dimas Mines from subsidiaries
of Goldcorp in August 2010.

Historical Exploration and Development Work

In the San Dimas mining district there are historical records that mention workings since 1757, but it was not until 1890 that there were formal operations by the San Luis Mining Company and Mexican Candelaria
Company. In 1904, the
first cyanide mill in Mexico was built at Tayoltita. By 1940, the Candelaria mine had been mined out.

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In the 1960s, higher grade discoveries led to the first deep drilling campaigns and to the initial long tunnels. In 1975, the first 4.5 kilometre tunnel (deepest in the district) was completed in the Tayoltita mine, this being an area where ore
discoveries such as the San Luis vein had taken place following the “Favourable Zone” concept aided by field geology. In the 1980s, American and Mexican groups commenced operations that led to the first geophysical and geochemical
exploration in the east “Tayoltita-Santa Rita” block.

By the late 1980’s and early 1990’s, the Favourable Zone concept and gold/silver ratios supported by fluid inclusion and thermal fusion studies led to discovery of the San Antonio and Santa Rita deposits. After acquisition of the whole
property by the Mexican group there was a significant reduction in exploration activities throughout the whole mining district.

In 2002, foreign investment (mainly Canadian) returned and the operation was acquired as a whole, which resulted in a substantial increase in drilling “long” drillholes combined with the development of long tunnels perpendicular to the
general trend of veins. Examples of these tunnels include San Luis, Santa Anita and Sinaloa Graben, where significant intersections and new high grade veins, such as the Elia, Aranza, Victoria and Alexa, were discovered.

Geology and Mineralization

Regional Geology

The general geological setting of the San Dimas district includes two major volcanic successions totalling approximately 3,500 metres in thickness, which have been described the Lower Volcanic Group (“LVG”) and the Upper Volcanic Group
(“UVG”) and are separated by an erosional and depositional unconformity.

The LVG is of Eocene age predominantly composed of andesites and rhyolitic flows and tuffs and has been locally divided into six units. The LVG outcrops, along the canyons which were formed by major westward drainage systems, have been intruded by
younger members of the batholith complex of granitic to granodioritic composition.

The Socavón rhyolite is the oldest volcanic unit in the district, its lower contact destroyed by the intrusion of the Piaxtla granite.

The overlying Productive Andesite is more than 750 metres in thickness and has been divided into two varieties based on grain size, but of identical mineralogy.  One variety is fragmental (varying from a lapilli tuff to coarse agglomerate), and the
other has a porphyritic texture (one to two millimetres plagioclase phenocrysts).

Above the Productive Andesite, the overlying Camichin unit, composed of purple to red interbedded rhyolitic and andesite tuffs and flows, is more than 300 metres thick. It is the host rock of most of the productive ore shoots of Patricia, Patricia
2, Santa Rita and other lesser veins in the Santa Rita mine.

The Las Palmas Formation, at the top of the LVG, consists of green conglomerates at the base and red arkoses and shales at the top, with a total thickness of approximately 300 metres. This unit outcrops extensively in the Tayoltita area. The lower
contact between the LVG and the underlying Productive Andesite is unconformable.

The predominant plutonic events in the district resulted in intrusion of the LVG by granitic to granodioritic intrusives, part of the Sinaloa composite batholith.

Other intrusives cutting the LVG include the Intrusive Andesite, the Elena aplite and the Santa Rita dacitic dikes. The even younger Bolaños rhyolite dike, and the basic dikes intrude both the LVG and UVG. Intrusive activity in the western
portion of the Sierra Madre Occidental has been dated continuously from 102 to 43 million years.  The UVG overlies the eroded surface of the LVG unconformably.

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Local and Property Geology

In the San Dimas district, the UVG is divided into a subordinate lower unit composed mainly of lavas of intermediate composition called Guarisamey Andesite and an upper unit called the Capping Rhyolite.  The Capping Rhyolite is mainly composed of
rhyolitic ash flows and air-fall tuffs and is up to 1,500 metres thick in the eastern part of the district; however, within most of the district it is about 1,000 metres thick. The San Dimas district lies within an area of complex normal faulting
along the western edge of the Sierra Madre Occidental.  Compressive forces first formed predominantly east-west and east-northeast tension gashes that were later cut by transgressive north-northwest striking slip faults.  The strike-slip movements
caused the development of secondary north-northeast faults, with right lateral displacement.

Deposits and Mineralization

Deposits

The deposits of the San Dimas district are high grade, silver-gold-epithermal vein deposits characterized by low sulphidation and adularia-sericitic alteration.  They were formed during the final stages of igneous and hydrothermal activity from
quartz-monzonitic and andesitic intrusions.

Typical of epithermal systems, the gold and silver mineralization at the San Dimas Mines exhibits a vertical zone with a distinct top and bottom that the prior owner of the mine termed the “Favourable Zone”. At the time of deposition,
this Favourable Zone was deposited in a horizontal position paralleling the erosional surface of the LVG on which the UVG was extruded.

This favourable, or productive, zone at San Dimas Mines is some 300 metres to 600 metres in vertical extent and can be correlated, based both on stratigraphic and geochronologic relationships, from vein system to vein system and from fault block to
fault block.

Mineralization

The mineralization is typical of epithermal vein structures with banded and drusy textures. Within the San Dimas district, the veins occupy east-west trending fractures except in the southern part of Tayoltita where they strike mainly northeast and
in the Santa Rita mine where they strike north-northwest. The veins were formed in two different systems. The east-west striking veins were the first system developed, followed by a second system of north-northeast striking veins. Veins pinch and
swell and commonly exhibit bifurcation, horse-tailing and sigmoidal structures. The veins vary from a fraction of a centimetre in width to eight metres, but average 1.5 metres. They have been followed underground from a few metres in strike length
to more than 1,500 metres.

Three major stages of mineralization have been recognized in the district: (1) early stage; (2) ore forming stage; and (3) late stage quartz. Three distinct sub-stages of the ore forming stage also have been identified, each characterized by
distinctive mineral assemblages with ore grade mineralization always occurring in the three sub-stages: (1) quartz-chlorite-adularia; (2) quartz-rhodonite; and (3) quartz-calcite.

The minerals characteristic of the ore forming stage are composed mainly of white, to light grey, medium to coarse grained crystalline quartz with intergrowths of base metal sulphides (sphalerite, chalcopyrite and galena) as well as pyrite,
argentite, polybasite, stromeyerite, native silver and electrum.

The ore shoots within the veins have variable strike lengths (five to 600 metres); however, most average 150 metres in strike length. Down-dip extensions of ore shoots are up to 200 metres but are generally less than the strike length.

Exploration and Drilling

Historically, exploration of the Favourable Zone at San Dimas Mines has been done both by diamond drilling and by underground development work. Diamond drilling is predominantly done from underground stations as both the rugged topography (i.e.
access to surface drill stations) and the great drilling distance from the surface locations to the target(s) makes surface drilling both challenging and expensive.  All exploration drilling and the exploration underground development work are done
both in-house and by use of contractors.

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Channel Sampling

While drilling is now the current method of exploration,
underground channel sampling plays a large role in the estimation of current
Mineral Resources.

Channel samples are routinely taken every three metres in all
development in vein, and stoping is sampled every two rounds (six metres).
Sample limits within the vein are based on texture and mineralogy changes. No
sample is more than 1.2 metres in length and the minimum sample width is 0.2
metres. A second cut is taken across the vein as a validation and the results
averaged for grade control purposes. A tarpaulin is laid down below the sample
line. The samples are taken as a rough channel along the marked line, ensuring
that the unit is sampled in a representative fashion, with large slabs being
broken and sub-sampled. The total sample which has collected on the tarpaulin is
broken with a hammer, mixed and quartered such that a two kilogram sample is
bagged and labelled with sample number and location details. Samples are
dispatched to the Primero Tayoltita Mine Laboratory (the TAY Lab) and samples
received by 1:00 p.m. are reported that day. Sketches of the face sampled are
filed, showing samples physical locations from surveying and the measured width
of each sample. Since January 2012, 15 percent of all channel samples and 100%
of drillcore samples were sent to the independent SGS laboratory in Durango.
These samples had QA/QC procedures applied and were of a standard that could be
reliably used for estimation of Mineral Resources. The vein mapping and channel
sampling is continually plotted on plans and both used for grade control and for
Mineral Resource estimation. In 2013 all channel samples collected and sent to
SGS laboratory in Durango (approximately 1/3) were subjected to QA/QC
procedures.

Drilling

All drilling was previously termed exploration drilling and was
intended to collect data well away from the underground development that was
intensively tested by channel sampling. Commencing in 2011 drilling campaigns
were designed to convert Inferred Mineral Resources to Indicated Mineral
Resources with new test new targets designated as exploration drilling. The
drilling conducted in 2013 is shown in the following table.

Area
    Number of Drill
      Holes
    MetresCentral Block
    236
    52,238Sinaloa Graben
    136
    34,513Tayoltita
    22
    2,283El Cristo
    12
    5,699West Block
    26
    7,076Total
    432
    101,809


Drill holes are typically drilled to get the best intersection
possible such that the intersected width is as close as possible to the true
width, while giving vertical coverage. Drilling underground is achieved by
drilling from one vein development to another, or from specific drill stations.
Holes are typically 200 to 250 metres long and generally between +/- 50 degrees
in dip, while surface drilling can be up to 700 metres deep. Generally, fans are
drilled on multiple sections from one set up. Since October 2011, samples have
been sent for analysis to the SGS laboratory in Durango and bulk density
measurements have been systematically taken on core samples.

Contemplated Exploration

The San Dimas $11.3 million 2014 delineation and mine
exploration program targets 28 veins and consists of 215 DDHs for 60,000 metres
of diamond drilling, with approximately 26,750 metres allocated for delineation
and 33,200 metres allocated for mine exploration, as well as 2,500 metres of
exploration drifting. The San Dimas 2014 regional exploration program includes
approximately 20,000 metres of diamond drilling targeting 17 veins over 1.5
metres wide.

The current main production area is located in a prolific
central corridor that runs south-west to north-east across the property. This
central corridor historically contains vein systems that are noted for their
high-grade nature, above average thickness and significant lateral extensions,
although it is expected that by the end of 2014 a percentage of production will
come from Alexa and Victoria in the Sinaloa Graben.

The main target of the 2014 underground mine delineation and
exploration program is to replace the depleted Mineral Reserves. The largest
portion of the delineation drilling is planned for the Roberta-Robertita and
Marina1- Marina2 vein systems in the Central Block approximately 23,000 (67%)
and the Victoria-Alexa and Elia-Aranza vein systems in the Sinaloa Graben,
approximately 3,500 metres (10%). A further 3,621 metres and 4,198 metres are
planned
for delineation in the Santa Rita and Tayoltita areas, respectively. The objective is to delineate accurately already known historical Mineral Resources in former producing veins.

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Mining Operations

The San Dimas Mines operation includes five underground gold and silver mining
areas: the West Block (San Antonio mine); the Sinaloa Graben Block; the Central
Block, the Tayoltita mine and the Arana Block (the Santa Rita mine). Vein
thickness varies from 0.1 metres to 8 metres with the average approximately 1.9
metres. Some veins have a strike length of more than 1,500 metres. Vein dips
vary from about 35o to sub-vertical, the latter being decidedly more
prevalent. The general mining recovery factor is about 95%, while that for sill
mining is about 75%.

Typical mining of the vein systems is by mechanized cut-and-fill & long hole,
using drill jumbos or jacklegs, pneumatic long hole drills and load-haul-dump
machines, with primary access provided by adits and internal ramps from an
extensive tunnel system through the steep, mountainous terrain.

Ground conditions throughout most of the San Dimas Mines operations are good.
The need for installation of ground support is assessed on an on-going basis as
development and stoping progresses. In flatter-dip vein areas where the stopes
tend to be wider, rock bolts and screen may be installed and low-grade pillars
left for support.

The basis for ore haulage at San Dimas Mines is LHD equipment feeding either
truck or rail haulage to the mill at Tayoltita. Development waste is generally
moved to stopes as fill.

There is one milling facility at Tayoltita to process the production from the
active mining areas in San Dimas. The Tayoltita mill has a conventional process
flowsheet that employs crushing and grinding followed by cyanidation and zinc
precipitation for recovery of gold and silver. The San Dimas Mines operate a dry
stack tailings deposition facility, which has a minimum of 17 year life at
current processing rate.

Recent Operating History for the San Dimas Mines

Primero has implemented a number of initiatives at San Dimas to increase production, reduce costs and expand Mineral Reserves and Mineral Resources. Initiatives designed to increase production include ensuring daily throughput at mill capacity of
2,150 tonnes per day (“tpd”), which was achieved by end of first quarter of 2013, introduction of the long hole mining method, improving productivity per man shift, controlling mining dilution, accelerating mine development to increase
the number of working faces, completing strategic tunnel connections and enhancing mine planning.

In October 2012, Primero initiated a mine and mill expansion of the San Dimas Mines. Primero has taken a staged approach, initially optimizing existing operations before undertaking expansion of the San Dimas Mines and mill to 912,500 tonnes per
year (“tpy”) or 2,500 tpd with an approved expenditure of $16.5 million. Construction of the mine and mill expansion was completed during the first quarter of 2014.

During the year ended December 31, 2013, San Dimas produced 143,114 gold equivalent ounces, exceeding Primero’s increased guidance range of 135,000 to 140,000 gold equivalent ounces. Primero produced 111,983 ounces of gold and 6.05 million
ounces of silver, 27% and 18% higher, respectively, than 2012. Production at San Dimas Mines in 2013 was higher than 2012 primarily as a result of mining more ore at higher grades. Throughput in 2013 increased by approximately 6% over 2012,
averaging 2,101 tpd (based on 365 day availability), as a result of implementing long-hole mining combined with Primero’s mining optimization program that was initiated in the 2012. The optimization program has been successful at reducing
process inefficiencies, increasing throughput and improving mining dilution. In 2012 San Dimas Mines was operating two long-hole drills to test the mining method in several of the San Dimas veins with varying widths and dip. In 2013 San Dimas Mines
formally included long-hole mining in its mine plans, whereby approximately 15% of total tonnes of mining was achieved by long-hole mining, with the objective to mine about 30% of the deposit by this method by the end of 2014.

Primero generated strong operating cash flow and continued to invest in the San Dimas Mines with capital expenditures during 2013 of approximately $68 million, including exploration activities.

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2014 Development Plans

Primero is currently commissioning the newly expanded milling facilities to 2,500 tpd.  The Company has designed the mill expansion project such that a potential further expansion to 3,000 tpd can be achieved with minimal capital and no down-time to
operations.  Primero will continue detailed engineering in 2014 for a potential expansion decision to 3,000 tpd by Q3 2014.

The San Dimas underground development plan for 2014 envisages a similar development rate and number of metres of advance as was achieved in 2013, being about 20 kilometres of drifting.

In 2014, San Dimas expects to produce between 155,000 and 165,000 gold equivalent ounces up to 15% higher than 2013, based mainly on higher throughput. Production is expected to ramp-up at the end of the first quarter when the milling capacity of
2,500 tpd is achieved. Cash production costs are expected to be in the range of $575 to $600 per gold equivalent ounce (or between $340 and $360 per gold ounce on a by-product basis) in 2014, similar to actual costs in 2013. Material
assumptions used to forecast total cash costs for 2014 include: an average gold price of $1,200 per ounce; an average silver price of $7.96 per ounce (calculated using the silver agreement contract price of $4.16 per ounce and assuming
excess silver beyond contract requirements is sold at an average silver price of $21 per ounce); and foreign exchange rates of 1.05 Canadian dollars and 13 Mexican pesos to the U.S. dollar.

Capital expenditures during 2014 are expected to total approximately $38 million excluding capitalized exploration costs. Underground development capital and sustaining capital remain at similar levels to 2013 at nearly $15 million. The 2014
project capital includes the remaining expenditure for the mill expansion to 2,500 tpd ($3.3 million), and the second phase of a two-year waste rock pad project ($3.3 million) designed to support the long-term waste disposal at San Dimas,
and the San Dimas Hydro power expansion and other projects ($5.2 million).

Environmental Matters

During the year ended December 31, 2013, Primero spent $0.82 million on capital projects related to environmental protection, being the purchase of a third tailings pump at the San Dimas Mine and the implementation of a containment system for
the tailings pipeline.

The San Dimas property is subject to a full closure plan and reclamation of the site upon cessation of operations, which would involve all facilities currently being used (mill, hydro plant, mines, surface infrastructure, power line, roads, dry
tailings).  Primero has accrued a decommissioning liability consisting of reclamation and closure costs for the San Dimas Mine.  The undiscounted cash flow amount of the obligation was $31.3 million at December 31, 2013 and the present value of
the obligation was estimated at $8.7 million, calculated using a discount rate of 7.75% and reflecting payments made during and at the end of the mine life, which for the purpose of this calculation, Primero has assumed is in 22 years. In
respect of the decommissioning liability, Primero expects to incur $2.2 million in 2015 and $2.0 million in 2016 to remediate the historical San Antonio tailings, with the remainder of the expenditures to be incurred mainly at the end of the
mine life.

Primero continued with its annual environmental awareness campaign reaching out to approximately 1,000 students from 10 different educational institutes.  Students from pre-school through to high school participated in discussions relating to
environmental education, energy and water conservation waste classification, and regional flora and wildlife.

In 2013 Primero received the Clean Industry Certification for improvements to its environmental management practices at the San Dimas operations. The voluntary program is coordinated by the Mexican environmental authority and reviews regulatory
compliance together with the Company's best practices and continuous improvement in environmental performance.

In February 2014, for a third consecutive year, Primero was awarded the “Socially Responsible Company (ESR) designation by CEMEFI, the Mexican Center for Philanthropy. The ESR award is given to companies operating in Mexico that are committed
to sustainable economic, social and environmental operations in all areas of corporate life, including business ethics, involvement with the community and preservation of the environment.

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On January 3, 2012, tailings containing 5 ppm cyanide were spilled into the Piaxtla River, impacting a total area of 2.5 kilometres.  The spillage was the result of a hole that developed in a tailings pipe.  Primero notified Mexican governmental
authorities of the incident. PROFEPA and CNA visited the site in January 2012. Primero understands that both the PROFEPA and the CNA considered the spillage to be localized. On January 5, 2012, the municipality of San Dimas confirmed in a letter to
Primero that they considered the incident as localized and under control. Following the spill, Primero took a number of corrective actions including design and building of a containment structure for the tailings pipe, which is now fully
operational. All PROFEPA’s requests were implemented and on September 3, 2012, Primero received final resolution from CNA specifying a fine of $93,500 pesos, which Primero paid on September 20, 2012. On September 17, 2012, following the
final resolution from CNA, Primero was notified by PROFEPA that it was fined $31,200 pesos. The resolution notification referred to non-compliance to a “hazardous waste” regulation.  In March 2013, Primero expressed its position to
PROFEPA that the tailings are not subject to the “hazardous waste” regulation.  Primero and PROFEPA came to terms that the tailings are not considered “hazardous waste”, at which point Primero accepted to pay the nominal fine
shortly thereafter in the first quarter of 2013. Following the corrective actions implemented by Primero, an external consulting firm completed an on-site inspection and concluded that the actions taken by Primero were sufficient and no long term
damage to the aquatic life was concluded.

Primero is currently dealing with two past environmental liabilities: reclamation of old San Antonio milling facilities and closure/reclamation of old San Antonio (Contraestaca) tailings facilities.  All work is expected to be completed in 2016.

San Antonio Tailings

Due primarily to the exhausted capacity of the tailings dam, the San Antonio mill was shutdown in 2003. The tailings dam site is located in a turn in a steep walled river canyon downstream of the mill operation. The river has been diverted through
two tunnels which have been excavated in the canyon wall on the inside of the river bend. A third tunnel for road access has been excavated and also serves as an additional channel for the river in high flow periods. In the 2002 due diligence by
Wheaton River, the San Antonio tailings dam was identified as a risk to failure due to a low safety factor in the dam, risk associated with an unknown hydrostatic head in the active tailings deposition area and possible erosion due to a flood event
in the adjacent river.

Since the shutdown of the San Antonio mill operations, some of the risk has been removed by elimination of the hydrostatic head in the dam and diversion of a local drainage channel. It has been proposed that the dam safety factor be increased by
extending the concrete wall on the upstream side of the dam and protection of the downstream side by covering it with mine waste rock. These measures would also decrease the erosion potential of the tailings. Some of this work was initiated while
options to close and reclaim the tailings dam were studied. DMSL received approval to reclaim the San Antonio dam by stabilizing the tailings in their current location after an environmental assessment, which demonstrated the validity of the plan,
was submitted.  A scale model was developed that, through a series of tests, determined the best design from the hydraulic aspect and to determine if some of the design features needed to be augmented.  During 2007, in agreement with the design by
Knight Piesold (Canadian geotechnical consultant), the emplacement of a rock filled berm began with about 60% completed, however, the rains and lack of an access road significantly affected progress. Further work was done in 2008 and subsequent
years.

Full closure of the San Antonio old tailings facilities, which consists of completing a downstream berm and spillway, will be completed in 2016 as per Primero’s asset retirement obligations.

Taxes

Corporate profits in Mexico are taxed only by the Federal Government. Through 2008, there were two federal taxes in Mexico that applied to mining company operations; a Flat Rate Business Tax (“FRBT”) and a corporate income tax.  Mexican
corporate income tax is calculated based on gross revenue less deductions for all refining and smelting charges, direct operating costs, all head office general and administrative costs, and depreciation deductions. During 2008 and 2009, the
corporate income tax rate in Mexico was 28%, it was 30% from 2010 to 2013, and it is planned to be 30% during 2014 and subsequent taxation years. On October 17, 2011, Primero filed a formal application to the Mexican tax authorities for an advance
pricing agreement on the appropriate price of silver sales under the silver purchase agreement. On October 4, 2012, Primero received a ruling from the Mexican tax authorities that the appropriate price was the approximate $4 per ounce received
from SW Caymans. This confirmed the silver pricing in Primero Empresa’s 2010 and 2011 income tax returns.

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On October 31, 2013, the Mexican Congress approved an extensive
tax reform bill that has far reaching implications to the mining sector and
taxpayers generally. The reforms included a tax-deductible mining royalty of
7.5% on taxable earnings before the deduction of interest, taxes, depreciation
and amortization, with precious metals mining companies paying an additional
0.5% on gold and silver revenue. The tax reforms are effective from January 1,
2014 and as such Primero is subject to the mining royalty as of this date. As
part of the reform, the FRBT was repealed.

Mineral Reserve and Mineral Resource Estimates

See Technical Information  Summary of Mineral Reserves and
Mineral Resources for the estimated Mineral Reserves and Mineral Resources
(silver only, 100% attributable) for the San Dimas Mines as ofDecember
31, 2013.

Production Information

The following table summarizes 2008 to 2013 silver production
from the San Dimas Mines:

Units
    2008
    2009
    2010
    2011
    2012
    2013Ore Processed
    (tonne)
    657,479
    673,311
    612,253
    662,612
    721,264
    766,930Gold Grade
    (g/t)
    4.3
    5.4
    4.5
    3.9
    3.9
    4.7Silver Grade
    (g/t)
    259
    249
    244
    226
    234
    258Gold Recovery
    (%)
    97
    98
    97
    97
    97
    97Silver Recovery
    (%)
    94
    95
    94
    96
    95
    95Produced Gold
    (oz)
    86,682
    113,018
    85,429
    79,564
    87,900
    111,983Produced Silver
    (oz)
    5,113,466
    5,093,385
    4,530,000
    4,602,846
    5,134,184
    6,054,360


PEÑASQUITO MINE, MEXICO

The Peñasquito Mine is indirectly wholly-owned by Goldcorp. The
Peñasquito Mine is an open pit mining operation located in north-central Mexico
with two separate process facilities, an oxide ore facility and a plant to
process sulfide ore. The oxide ore is processed through a heap
leach/Merrill-Crowe facility that went into production in February 2008. The
first gold pour for the oxide circuit was on May 10, 2008. Line 1 of the sulfide
plant started operating in September 2009 and first concentrate was shipped
November 2009. The Peñasquito Mine achieved commercial production in September
2010.

The following description of the Peñasquito Mine is based on
the information disclosed in the annual information form of Goldcorp filed on
March 31, 2014. The Company QPs have approved the disclosure of scientific and
technical information in respect of the Peñasquito Mine in this document.

Property Description and Location

The operating entity for the Peñasquito Mine is an indirectly
wholly-owned Goldcorp subsidiary, Minera Peñasquito, S.A. de C.V. (Minera
Peñasquito). Peñasquito is situated in the western half of the Concepción Del
Oro district in the northeast corner of Zacatecas State, Mexico, approximately
200 kilometres northeast of the city of Zacatecas.

Mining at the Peñasquito Mine commenced in 2010 and full
production commenced in 2011. The Peñasquito Mine is comprised of 19 mining
concessions (45,752.9423 hectares), as at January 8, 2014, held in the name of
Minera Peñasquito. Concessions were granted for durations of 50 years and a
second 50-year term can be granted if the applicant has abided by all
appropriate regulations and makes the application within five years prior to the
expiration date. Obligations which arise from the mining concessions include
performance of assessment work, payment of mining taxes and compliance with
environmental laws. Duty payments for the concessions have been made as
required. Minimum expenditures, pursuant to Mexican regulations, may be
substituted for sales of minerals from the mine for an equivalent amount.
Goldcorp holds additional tenure in the greater Peñasquito Mine area (within
about 200 to 300 kilometres of the Peñasquito Mine infrastructure), which is
under application, is granted, or is part of joint ventures with third parties.

A two percent net smelter return royalty is payable to Royal
Gold on production from both the Peñasco and Chile Colorado pits which
constitute the Peñasquito Mine. The Mexican Government has passed a new mining
royalty, effective
1 January 2014, which will consist of a 7.5% mining royalty imposed on earnings before interest, tax, depreciation and amortization (EBITDA).  There is also an additional 0.5% royalty on precious metals revenue (applicable to precious metals mining
companies) that will also be in effect as of January 1, 2014. In 2007, the Company acquired 25 percent of the silver produced by the Peñasquito Mine over the life-of mine for an upfront cash payment of $485 million and a per ounce cash
payment of the lesser of $3.90 and the prevailing market price (subject to an inflationary adjustment commencing in 2011), for silver delivered under the contract.

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Environmental liabilities are limited to those that would be expected to be associated with a polymetallic mine, where productions occurs from open pit sources, and where disturbance includes mining operations, roads, site infrastructure, heap
leach, and waste and tailings disposal facilities. A closure and reclamation plan has been prepared for the mine site. Goldcorp holds the appropriate permits under local, state and federal laws to allow for mining operations.

Accessibility, Climate, Local Resources, Infrastructure and Physiography

There are two access routes to the site. The first is via a turnoff from Highway 54 onto the State La Pardita road, then onto the Mazapil to Cedros State road.  The second access is via the Salaverna by-pass road from Highway 54 approximately 25
kilometres south of Concepción Del Oro. Within the Peñasquito Mine, access is by foot trails and tracks. The closest rail link is 100 kilometres to the west. There is a private airport on site and commercial airports in the cities of
Saltillo, Zacatecas and Monterrey. Travel from Monterrey/Saltillo is approximately 150 kilometres, about two hours to site. Travel from Zacatecas is approximately 275 kilometres, about 3.5 hours to site.

Power is currently supplied through the Mexican central grid from the Mexican Federal Electricity Commission. On January 25, 2011, Goldcorp signed a power delivery agreement with a subsidiary of InterGen, pursuant to which InterGen will construct
and operate a 200 megawatt gas-fired combined cycle power plant to deliver 177 megawatts of supplied electricity to the Peñasquito Mine and other operations in Mexico for a minimum term of 20 years. Construction of the power plant began in
December 2012, with completion projected for the first quarter of 2015. An amendment to the original contract to increase the supplied electricity by five megawatts is currently pending approval by Goldcorp. Goldcorp holds all necessary permits for
the power line and road access to site.

Process and potable water for the Peñasquito Mine is sourced from the Torres-Vergel well field located six kilometres west of the Peñasquito Mine and permits to pump up to 35 million cubic metres per year from this source have been
received. The existing supply of groundwater is not sustainable in the long term and has resulted in a reduction of plant throughput in 2013 due to lower than planned volumes from the current infrastructure. In 2012 and 2013, expansion to the
current Torres–Vergel well field have occurred. To allow plant production to return to design levels, an additional groundwater source within the Cedros basin has been identified.  This area is named the Northern Well Field, and is
approximately 60 kilometres northwest of the Peñasquito Mine and construction will take place during 2014. Under the Mining Law in Mexico, the owner of a mining concession is entitled to use the water extracted from the mine in connection
with exploration and mining activities. The Peñasquito Mine recycles almost 70 percent of the water it uses in the mining process with the existing tailings facility.

There is sufficient suitable land available within the Goldcorp mineral tenure for tailings disposal, mine waste disposal, and mining-related infrastructure, such as the open pit, process plant, workshops and offices. A skilled labour force is
available in the region where the Peñasquito Mine is located and in the surrounding mining areas of Mexico. Accommodation comprises a 1,900-bed camp with full dining, laundry and recreational facilities. Fuel and supplies are sourced from
nearby regional centres such as Monterrey, Monclova, Saltillo and Zacatecas and imports from the United States via Laredo.

Mining concessions give the holder the right to mine within the concession boundary, sell the mining product, dispose of waste material generated by mining activities within the lease boundary, and have access easements. Surface rights in the
vicinity of the Chile Colorado and Peñasco open pits are held by four ejidos, as well as certain private owners. Goldcorp has signed current land use agreements with three of the ejidos and the relevant private owners. Under current
agreements with the ejidos, payments are made to the ejidos on an annual basis, in addition to certain upfront payments that have already been made.

There is litigation pending regarding the land use agreement with Ejido Cerro Gordo. The Cerro Gordo lands include 60% of the mine pit area, the waste dump, and explosives magazine.  On June 18, 2013 the agrarian courts in Mexico ruled that the land
use agreement was null and ordered the Cerro Gordo lands to be returned to the Ejido Cerro Gordo.  Minera Peñasquito has prepared the required filings and is taking steps to expropriate the Cerro Gordo lands.

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Negotiations are continuing between Minera Peñasquito and authorized representatives of the Ejido Cerro Gordo with a view to reaching a mutually beneficial settlement of a land claim. To date, operations at the Peñasquito Mine have not
been impacted by these legal proceedings. If a settlement is not reached regarding use of the Cerro Gord lands and a new land use agreement is not entered into, there is a risk to the Mineral Reserves and mine operations as a portion of the
Peñasco open pit and infrastructure associated with the Cerro Colorado pit fall within the Cerro Gordo lands.

The climate is generally dry with precipitation being limited for the most part to a rainy season in the months of June and July. Annual precipitation for the area is approximately 700 millimetres, most of which falls in the rainy season. The
Peñasquito Mine area can be affected by tropical storms and hurricanes which can result in short-term high precipitation events.  Temperatures range between 20 degrees Celsius and 30 degrees Celsius in the summer and zero degrees Celsius to
15 degrees Celsius in the winter. Mining operations can be conducted year-round.

The Peñasquito Mine is situated in a wide valley bounded to the north by the Sierra El Mascaron and the south by the Sierra Las Bocas. Except for one small outcrop, the area is covered by up to 30 metres of alluvium. The terrain is generally
flat, rolling hills; vegetation is mostly scrub, with cactus and coarse grasses.  The prevailing elevation of the property is approximately 1,900 metres above sea level.

History

The earliest recorded work in the Peñasquito Mine consists of excavation of a shallow shaft and completion of two drill holes in the 1950s. Kennecott Canada Explorations Inc. through its Mexican subsidiary, Minera Kennecott S.A. de C.V.
(“Kennecott”) acquired initial title to the Peñasquito Mine and commenced exploration in 1994.  Regional geochemical and geophysical surveys were undertaken in the period 1994 to 1997. This work led to the early discovery of two
large mineralized diatreme breccia bodies, the Outcrop (Peñasco) and Azul Breccias. Kennecott completed 250 rotary air blast (“RAB”) drill holes (9,314 metres) to systemically sample bedrock across the entire Peñasquito
Mine area which resulted in the discovery of the Chile Colorado silver-lead-zinc-gold zone. A total of 72 reverse circulation and core drill holes (24,209 metres) were sited to test mineralization at the Outcrop Breccia, Azul Breccia, and Chile
Colorado zones.

In 1998, Western Copper Holdings Ltd. (“Western Copper”) acquired a 100 percent interest in the Peñasquito Mine from Kennecott.  Western Copper completed a nine hole (3,185 metres) core drilling program and 13.4 line kilometres of
tensor controlled source audio frequency magnetollurics geophysical survey work the same year. Exploration efforts were focused on the Chile Colorado zone and the Azul Breccia pipe targets. Western Copper optioned the property to Minera Hochschild
S.A. (“Hochschild”) in 2000. Hochschild completed 14 core holes (4,601 metres), eleven of which were sited into the Chile Colorado anomaly, but subsequently returned the property to Western Copper. From 2002 to 2009, Western Copper
completed an additional 874 core and reverse circulation drill holes (496,752 metres) and undertook a scoping-level study, a pre-feasibility study, and a feasibility study in 2003, 2004, and 2005 respectively. The feasibility study was updated in
2006. Under the assumptions in the studies, the Peñasquito Mine returned positive economics. In 2003, Western Copper underwent a name change to Western Silver Corporation (“Western Silver”).  Glamis acquired Western Silver in May
2006, and the combined company was subsequently acquired by Goldcorp in November 2006.

During 2005, a drill rig was used to perform geotechnical field investigations to support the design of the heap leach facility, waste rock piles, tailings impoundment and process plant.  Standard penetration tests were performed. Construction in
the Peñasquito Mine commenced in 2007. In October 2009, the first lead and zinc concentrates were produced and concentrate shipment to smelters commenced with first sales recorded in November 2009.

Geological Setting

Regional Geology

The regional geology is dominated by Mesozoic sedimentary rocks, which are intruded by Tertiary stocks of intermediate composition (granodiorite and quartz monzonite), and overlain by Tertiary terrestrial sediments and Quaternary alluvium.  The
Mesozoic sedimentary rocks comprise a 2.5 -kilometre thick series of marine sediments deposited during the Jurassic and Cretaceous Periods with a 2,000-metre thick sequence of carbonaceous and calcareous turbiditic siltstones and interbedded
sandstones underlain by a 1,500 to 2,000-metre thick limestone sequence.

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Local Geology

The Mesozoic sedimentary rocks of the Mazapil area were folded into east-west arcuate folds during the Laramide orogeny.  End-Laramide extension was accommodated by northwest-, northeast- and north-striking faults, contemporaneous with deposition of
Tertiary terrestrial sediments in fault-bounded basins. Tertiary granodiorite, quartz monzonite, and quartz–feldspar porphyry were also intruded during this period of extension. Current topography reflects the underlying geology, with ranges
exposing anticlines of the older Mesozoic rocks, while valleys are filled with alluvium and Tertiary sediments overlying synclinal folds in younger Mesozoic units.  Tertiary stocks and batholiths are better exposed in the ranges. Two diatreme pipes,
Peñasco and Brecha Azul, intrude the Caracol Formation shales in the centre of the Mazapil valley, and form the principal hosts for known gold-silver-lead-zinc mineralization at Peñasquito. The breccia pipes are believed to be related
to quartz–feldspar porphyry stocks beneath the Peñasquito Mine area. The current bedrock surface is estimated to be a minimum of 50 metres (and possibly several hundred metres) below the original paleo-surface when the diatremes were
formed. The brecciated nature of the host rock indicates that the diatremes explosively penetrated the Mesozoic sedimentary units and it is likely that they breached the surface; however eruption craters and ejecta aprons have since been eroded
away. Alluvium thickness averages 30 to 50 metres at Peñasquito, and this cover obscured the diatremes apart from one small outcrop of breccia near the center of the Peñasco diatreme, rising about five metres above the valley surface.
The single outcrop near the center of the Peñasco pipe contained weak sulphide mineralization along the south and west side of the outcrop, representing the uppermost expression of much larger mineralized zones below.

Property Geology

Peñasco and Brecha Azul are funnel-shaped breccia pipes, which flare upward, and are filled with brecciated sedimentary and intrusive rocks, cut by intrusive dikes. The larger diatreme, Peñasco, has a diameter of 900 metres by 800
metres immediately beneath surface alluvial cover, and diatreme breccias extend to at least 1,000 metres below surface. The Brecha Azul diatreme, which lies to the southeast of Peñasco, is about 500 metres in diameter immediately below
alluvium, and diatreme breccias also extend to at least 1,000 metres below surface. Porphyritic intrusive rocks intersected in drilling beneath the breccias may connect the pipes at depth.  Polymetallic mineralization is hosted by the diatreme
breccias, intrusive dikes, and surrounding siltstone and sandstone units of the Caracol Formation. The diatreme breccias are broadly classified into three units, in order of occurrence from top to bottom within the breccia column, which are
determined by clast composition: sediment-clast breccia, mixed-clast (sedimentary and igneous clasts), and intrusive-clast breccias. Sedimentary rock clasts consist of Caracol Formation siltstone and sandstone; intrusion clasts are dominated by
quartz-feldspar porphyry. For the purposes of the geological block model, the sediment-clast and mixed-clast breccias were combined into one unit, and are distinguished from the intrusion-clast breccia. A variety of dikes cut the breccia pipes and
the immediately adjacent clastic wall-rocks.  These dikes exhibit a range of textures from porphyry breccia, to quartz–feldspar and quartz-eye porphyries, to porphyritic, to aphanitic micro breccias. For the block model they are combined into
a single intrusive domain.

The Peñasco and Brecha Azul diatremes are considered to represent breccia-pipe deposits developed as a result of Tertiary intrusion-related hydrothermal activity. Alteration, mineral zoning, porphyry intrusion breccia clasts, and dykes all
suggest the diatreme-hosted deposits represent distal mineralization some distance above an underlying quartz–feldspar porphyry system. Such deposits commonly exhibit structural influence from graben faults or faulting related to cauldron
subsidence. The Peñasco and Brecha Azul diatremes lie along a northwest-trending system of subvertical fractures within the central axis of the broad northwest oval of sericite–pyrite–quartz–calcite alteration. This may
reflect the orientation of the porphyry intrusion underlying the known mineralization. Both of the breccia pipes lie within a hydrothermal alteration shell consisting of a proximal sericite–pyrite–quartz (phyllic) alteration assemblage,
distal sericite–pyrite–quartz–calcite assemblage, and peripheral chlorite–epidote–pyrite (propylitic) alteration halo.  A halo of generally lower grade disseminated zinc–lead–gold–silver mineralization
lies within the sericite–pyrite–quartz–calcite assemblage surrounding the two breccia pipes.

Exploration

Exploration activities on the Peñasquito Mine have included geological mapping, reverse circulation and core drilling, ground geophysical surveys, mineralization characterization studies and metallurgical testing of samples. Petrographic
studies and density measurements on the different lithologies have also been carried out. Much of this work has been superseded by the data obtained during the drilling programs that support the Mineral Resource and Mineral Reserve estimates and by
data collected during mining operations.

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From 2006 to 2013, Goldcorp completed 286 core and 93 reverse circulation exploration drill holes, plus 46 metallurgical, 40 geotechnical, 298 condemnation, and 26 in-fill drill holes. An updated feasibility study was completed, mining was commenced
(2007), the first doré was produced (2008), mechanical completion of the first mill/flotation line (50,000 tonnes per day) (2009) and production and shipment of the first concentrates were produced and shipped (2009).

A deep exploration drilling program was conducted between 2011 and 2013 to test for the presence of sulphide manto and skarn-hosted mineralization at depth. The exploration target was to define mineralization that might be able to support potential
underground development adjacent to and/or between the Peñasco and Brecha Azul diatreme pipes. Manto and skarn-hosted mineralization was intercepted starting at 900 metres below the surface. Potentially significant skarn- and breccia- hosted
mineralization was located between the Brecha Azul and Peñasco diatremes. There is also potential for additional deposit styles within the extensive Peñasquito Project, including base metal skarns and porphyry-related disseminated
deposits in geological settings.  Exploration for these mineralization styles is ongoing.  Goldcorp conducted an additional drilling campaign to the north of Peñasco in 2011, which consisted of 59 shallow reverse circulation drill-holes
designed to collect bedrock samples from immediately beneath the alluvial cover.  Anomalies identified by this program were later tested to greater depth with core drill-holes. No significant mineralization was identified from the programs.

Mineralization

Both the Peñasco and Chile Colorado deposits are centered on diatreme breccia pipes, the Peñasco diatreme at Peñasco, and the Brecha Azul diatreme at Chile Colorado. The diatremes contain and are surrounded by coalesced halos of
disseminated, veinlet and vein-hosted sulphides and sulphosalts containing silver and gold.  Mineralization consists of disseminations and veinlets and veins of various combinations of medium to coarse-grained pyrite, sphalerite, galena, and
argentite. Sulphosalts of various compositions are also abundant in places, including bournonite, jamesonite, tetrahedrite, polybasite, pyrargyrite, stibnite, rare hessite, chalcopyrite and molybdenite. Gangue mineralogy includes calcite, sericite,
and quartz, with quartz, rhodochrosite, fluorite, magnetite, hematite, pyrite, garnets (grossularite–andradite) and chlorite–epidote. Carbonate is more abundant than quartz as a gangue mineral in veins and veinlets, particularly in the
“crackle breccia” that occurs commonly at the diatreme margins.

Mantos-style sulphide replacements of carbonate strata have been identified within the Caracol Formation adjacent to the diatreme pipes, beneath the clastic-hosted disseminated sulphide zones. They consist of semi-massive to massive sulphide
replacements of sub-horizontal limestone beds, as well as structurally-controlled cross-cutting chimney-style, steeply dipping, fracture and breccia zones filled with high concentrations of sulphides.  The sulphides are generally dominated by
sphalerite and galena, but also contain significant pyrite.  Gangue minerals (commonly carbonates) are subordinate in these strata-replacement mantos and cross-cutting chimneys.  Stratiform and chimney mantos are characterized by their very high
zinc, lead, and silver contents, with variable copper and gold contributions.

A new style of Copper–Gold–Silver–Zinc–Lead garnet skarn mineralization with dissolution breccias has been identified at depth between the Peñasco and Brecha Azul diatremes. Mineralization identified to date occurs
within the Indidura, Cuesta del Cura and the Taraises–La Caja Formations.  The main trend of this mineralization is northwest–southeast, with the best grades located between the diatremes. The skarn has horizontal dimensions of
approximately 1,000 metres by 1,200 metres and is open at depth. This polymetallic mineralization is hosted by garnet skarn and associated breccias, mainly as chalcopyrite, sphalerite, gold, and silver.  Gangue minerals consist of pyrite, calcite,
garnet, and magnetite. The garnet skarns are often surrounded by halos of hornfels, especially in siliciclastic units, and/or marble and recrystallized limestone in carbonate units. The deep exploration programs have also identified quartz feldspar
porphyry with strong sericite-pyrite-quartz-calcite and potassic alteration, which contain occasional veinlets of quartz with molybdenite, and veins with secondary biotite and magnetite disseminated in the wall rocks.

Drilling

Drilling completed on the Peñasquito Mine area for the period 1994 to 2013 comprised 1,333 drill holes totaling 689,847 metres. Drilling has focused on the exploration and delineation of three principal areas: the Chile Colorado Zone, the
Brecha Azul Zone and the Peñasco Zone.

Reverse circulation drilling was conducted using down-hole hammers and tricone bits, both dry and with water injection.  Some reverse circulation drilling was performed as pre-collars for core drill holes.  Core drilling typically recovered HQ size
core (63.5 millimetres diameter) from surface, then was reduced to NQ size core (47.6 millimetres) where ground conditions warranted. Metallurgical holes were typically drilled using PQ size core (85 millimetres).

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Any break in the core made during removal from the barrel was marked with a “colour line”. When breakage of the core was required to fill the box, edged tools and accurate measure of pieces to complete the channels was the common
practice to minimize core destruction. The end of every run was marked with a wooden tick and the final depth of the run. Core was transferred to wooden core boxes, marked with “up” and “down” signs on the edges of the boxes
using indelible pen. The drill hole number, box number and starting depth for the box was written before its use, whilst end depth were recorded upon completion. All information was marked with indelible pen on the front side of the box and also on
the cover. All core from the Goldcorp drill programs has been processed on site. Core boxes were transported to the core shed by personnel from the company that was managing the drill program, or the drilling supervisor.

Geotechnical Drilling

Oriented core drilling for geotechnical purposes was performed in 2004 with eight core holes completed in the area of the planned Chile Colorado pit and three core holes in the planned Peñasco pit area for a total 11 core holes (4,126
metres). Core holes were oriented at an angle of 60 degrees to the horizontal and were sited to intersect the November 2005 design basis pit wall one-third of the ultimate wall height above the base of the final pit level. Core hole diameters were
typically HQ3 (61 millimetres diameter) but were telescoped down to NQ3 (45 millimetres) if difficult drilling conditions were encountered. Core was recovered in a triple tube core barrel assembly. Core recovery for the Peñasquito Mine
drilling programs averaged 97 percent. Sample recoveries were not routinely recorded for reverse circulation holes.

Recent drilling, in the period 2010 to 2013, when the mine was operational, has comprised 22 drill holes (7,253.2 metres). Six of these holes were sited in the Chile Colorado pit and the remainder was drilled for support of the Peñasco pit.
Holes ranged in dip from vertical to 65 degrees and were either HQ3 or PQ3 in size. The drill holes were sited to provide geotechnical information for pit phase designs and for support of potential modification of pit wall slope angles in selected
pit sectors.  A total of 68 laboratory triaxial tests of intact rocks were performed and 52 direct shear tests to estimate the unconfined strength of the intact rock. An additional target was obtaining information on the bedding planes within the
Caracol Formation. The RQD model was updated with the recent drill information, and a total of 1,211 holes were used.  A total of 1,348 holes and 13 geomechanical cells were used to construct the bedding model.  Additional drilling is planned in
2014 to provide further data on the partial pit phase designs planned for Peñasco, primarily to test the north and west pit sectors.

Metallurgical Drilling

Metallurgical drilling was first performed between 2003 and 2006, with 13 holes (4,016 metres) completed. Holes averaged 310 metres in depth. An additional 28 core holes were drilled in 2006 to 2012, consisting of 28 holes (15,375 metres), which
were typically 550 metres long.  During 2013, 28 holes (9,156 metres) were completed, averaging 510 metres in length.

Hydrogeological Drilling

A number of water wells have been completed in support of supply of the Peñasquito Mine’s water needs.

Geological and Geotechnical Logging

Logging of reverse circulation drill cuttings and core utilized standard logging procedures. Logs recorded lithologies, breccia type, fracture frequency and orientation, oxidation, sulphide mineralization type and intensity, and alteration type and
intensity. In July 2013, digital logging was implemented. Logs are stored on the mine server in an exploration database.  Information now recorded includes lithology, alteration, minerals, structural features, oxidation description, and vein types.
Core was photographed; core photographs are retained on the mine server.  Video was recorded from drill collar to toe; these digital files are stored on hard disc. Geotechnical logging for pit design purposes was typically completed at three metre
intervals, and recorded on compact discs. For site location purposes, geotechnical logging included sample descriptions, Standard Penetration Test blow counts, sample numbers and visual classifications based on the united soil classification system.
From 2010 onwards, all geotechnical logging has been stored in an acQuire database.

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Collar Surveys

Collar surveys have been performed by a qualified surveyor since 2002. Since preparation for mining operations commenced in 2007, all surveys have been performed using digital global positioning system instruments. All drill hole collars are
identified with a concrete monument, allowing all drill holes to be identified at a later date. The monument is placed directly over the hole collar on completion of each drill hole.

Down-hole Surveys

Down-hole surveys are completed by the drilling contractor using a single shot, through the bit, survey instrument. Drill holes are surveyed on completion of each hole as the drill rods are being pulled from the hole. Use of a gyroscopic survey
instrument began in 2012, when Silver State Survey was contracted. In the first 800 metres of any drill hole, Silver State Survey takes a measurement at 50 metre intervals and at the end of the drill hole.

Deposit Drilling

Drill hole spacing is generally on 50 metre sections in the main deposits spreading out to 400 metre spaced sections in the condemnation zones. Drill spacing is wider again in the areas outside the conceptual pit outlines used to constrain Mineral
Resources.  Drilling covers an area of approximately 11 kilometres east to west by seven kilometres north to south with the majority of drill holes concentrated in an area 2.1 kilometres east to west by 2.8 kilometres north to south.

Drilling is normally perpendicular to the strike of the mineralization. Depending on the dip of the drill hole, and the dip of the mineralization, drill intercept widths are typically greater than true widths.

Sampling and Analysis

Peñasquito Mine project staff has been responsible for sample collection, core splitting, run of mine assaying, preparation of samples, storage and security from inception to date.  All analyses of exploration drill-hole and surface samples
were performed by certified off-site analytical laboratories.

Reverse circulation drill cuttings were sampled at intervals of two metres. The material was split at the drill into several portions of 12 kilograms or less. A handful of rock chips from each sample interval was collected and logged by experienced
onsite geologists. Data from the drill logs were entered digitally into files for computer processing. From mid-2013, all data are entered digitally into the database.

The standard sample interval is two metres. Some samples are limited to geological boundaries and are less than two metres in length. Logging was completed at the drill site prior to splitting. Splitting of the core was supervised by the geologist
who logged the core in order to ensure sampling integrity. For condemnation drill holes, core was assayed every two metres out of 20 unless geologic inspection dictated otherwise.  A senior Goldcorp geologist examined the core, defined the primary
sample contacts, and designated the axis along which to cut the core. Special attention is taken in veined areas to ensure representative splits are made perpendicular to, and not parallel to, veins.

Standard reference material samples and blanks were inserted in a documented sequence into the sample stream going to the assay laboratory. Cut samples were bagged and numbered in polyethylene bags. Groups of 20 sample bags were placed in larger
bags and labelled with the name and address of the laboratory, and the number and series of samples that were contained within the bag. A Peñasquito Mine truck transports the sacks to the ALS Chemex laboratories in Guadalajara, Mexico,
approximately once per week.  ALS Chemex was responsible for sample preparation throughout exploration and infill drilling phases through its non-accredited sample preparation facilities in Guadalajara. All samples were dispatched to the ALS Chemex
Vancouver, Canada laboratory facility for analysis, which, at the time the early work was performed, was ISO-9000 accredited for analysis; the laboratory is currently ISO-17025 certified and is independent of Goldcorp. The umpire (check) laboratory
is Acme Laboratories in Vancouver, which holds ISO-9000 accreditations for analysis. The run-of-mine laboratory is not certified.

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Blast holes are sampled as whole-hole samples by an experienced sampler.  During 2008, Goldcorp staff completed a total of 1,229 specific gravity measurements on drill core. An additional 127 bulk density measurements were also available from Dawson
Metallurgical Laboratories Inc. Utah. Specific gravity data were used to assign average bulk specific gravity values by lithology. From 2011, a standard procedure was implemented, whereby a density sample, 20 centimetres in length, was taken every
20 metres from core holes. Core is coated, and the specific gravity measured using the water displacement method. To end November 2013, a total of 3,802 determinations have been made.

A number of independent data checks have been performed, in support of feasibility-level studies, and in support of technical reports, producing assessments of the database quality on the Peñasquito Mine. No significant problems with the
database, sampling protocols, flowsheets, check analysis program, or data storage were noted. Goldcorp performed sufficient verification of the data and database to support Mineral Resources and Mineral Reserves being estimated.

Security of Samples

Blanks and standard reference materials have been used in sampling programs by Goldcorp. The seven standard reference materials were prepared by Metcon Research, Tucson, Arizona from Peñasquito Mine mineralization.  Blank samples comprise
non-mineralized limestones from the general Peñasquito Mine area.  Goldcorp acquired eight new standard reference materials in December 2009 which consist of Peñasquito core prepared by SGS and submitted to round-robin analyses by
several certified laboratories.  Blank samples utilized since 2013 consist of crushed non-mineralized sandstone from reverse circulation holes drilled in 2011 to the north of the Peñasquito Mine area.

Entry of information into databases utilized a variety of techniques and procedures to check the integrity of the data entered. Electronic data entry (without a paper log step) is still being implemented. Digital drill-hole logging was implemented
in mid-2013 using acQuire software. Assays received electronically from the laboratories are now imported directly into the database. Analytical certificates received since 2010 have been stored in the data base and were validated via the acQuire
software. Drill-hole collar and down-hole survey data were manually entered into the database prior to 2013. Since initiation of digital logging and full implementation of the acQuire database in 2013, the collar and down-hole surveys are imported
into the database using acQuire.  Data are verified on entry to the database by means of built-in program triggers within the mining software. Checks are performed on surveys, collar co-ordinates, lithology data, and assay data.

Paper records have been archived for all assay and quality assurance and quality control data, geological logging and bulk density information, down-hole and collar coordinate surveys. All paper records were filed by drill-hole for rapid location
and retrieval of any information desired. Assays, down-hole surveys, and collar surveys were stored in the same file as the geological logging information. Sample preparation and laboratory assay protocols from the laboratories were also monitored
and kept on file. Exploration data are appropriately stored on a mine server, and data are regularly backed up by the Peñasquito Mine IT department.

Sample security was not generally practiced at the Peñasquito Mine during the drilling programs, due to the remote nature of the site.  Sample security relied upon the fact that the samples were always attended or locked at the sample
dispatch facility.  Sample collection and transportation have always been undertaken by Goldcorp or laboratory personnel using company vehicles.  Drill samples were picked up at site by ALS Chemex, prepared to a pulp in Guadalajara, Mexico, and sent
by ALS Chemex via air to the ALS Chemex analytical laboratory in Vancouver, Canada. Chain of custody procedures consisted of filling out sample submittal forms that were sent to the laboratory with sample shipments to make certain that all samples
were received by the laboratory. Assay pulps and crushed reject material are returned by ALS Chemex to Goldcorp’s core shack in Mazapil for storage. Drill core is stored in wooden core boxes on steel racks in the buildings adjacent to the core
logging and cutting facilities.  The core boxes are racked in numerical sequence by drill hole number and depth oarse rejects in plastic bags are stored in cardboard boxes on steel racks in a separate locked building. The coarse reject boxes are
labelled and stored by sample number.

Typically, drill programs included insertion of blank, duplicate and standard reference material samples.  The quality assurance and quality control program results do not indicate any problems with the analytical programs; therefore the gold,
silver, and base metal analyses from the core drilling are suitable for support of Mineral Resource and Mineral Reserve estimation.

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Mineral Reserve and Mineral Resource Estimates

See “Technical Information – Summary of Mineral Reserves and Mineral Resources” for the estimated Mineral Reserves and Mineral Resources (silver only, 25% attributable) for the Peñasquito Mine as of December 31, 2013.

As part of project commissioning and initial operations, fluctuations to life of mine average predictions requires the operation to review and use sufficient data that is expected to be meaningful over the life of mine. Depending on the
jurisdiction, assumptions made in feasibility studies as to social licence, environmental permitting, environmental monitoring and closure requirements, and regulatory regimes can subject to change by the time a mining operation has reached what is
considered to be the average life of mine output.

The Peñasquito Mine operation was reviewed in 2013. The following deviations from the 2008 feasibility study assumptions, based on third quarter 2013 data, were noted:

- Changes to metal price and exchange rate assumptions;
- Changes to the value estimation methodology used in the Mineral Resource block model;
- Updates to the pit shell assumptions used in pit optimization;
- Updates, based on the current knowledge of processing and treatment costs, of the cut-off grade used to determine material sent to either the low-grade stockpile or the waste rock storage facilities;
- Updates to the mine plan such that only material with a low strip-ratio is considered to be mineable whereas previous studies have higher strip-ratio material included in the mine plan;
- Detailed plant throughput data on a fully representative set of production data indicated that the block-scale mineralogical variability was not captured at the sampling spacing available during the feasibility studies. Grade of payable elements was
acceptable; however, there were some selective mining unit blocks that had significantly elevated potentially deleterious and penalty-incurring elements. This has resulted in a number of blocks falling below the current economic threshold used for
the Mineral Reserves;
- Identification of these higher-penalty selective mining unit blocks has required modifications to in-pit sequencing and mine design so that the material is either not mined at all, or is sent to waste, or is sent to the low-grade stockpile;
- Updates to metallurgical recovery assumptions. Earlier studies had assumed fixed recoveries, and these assumptions were replaced in 2013 by a set of recovery equations based on actual plant performance;
- Updates to the assumptions regarding treatment and refining costs; prior to 2013, these were assumed to be fixed;
- Changes to the classifications used for concentrates, such that there are five concentrate types in 2013;
- Updates to operating and general and administrative costs from 2006 to 2013;
- Updates to sustaining capital cost estimates from 2006 to 2013;
- Imposition by the Mexican authorities of a royalty on precious metals production from January 2014;
- Changes by the Mexican authorities to the taxation regime from January 2014; and
- Capital costs and operating costs for additional water infrastructure to support mine water supply and for the second tailings storage facility.

Mining OperationsMining Method

Mine production during the first three quarters of 2013 was 167.2 million metric tonnes. For 2014, the throughput rate selected was based on the assumption that a 110 kilotonnes per day (“ktpd”) operation can be sustained using the
available water well field. From 2015 onwards the operation is expected to benefit from the availability of a new water pipeline and the mine schedule reflects a throughput rate of 115 ktpd for the remainder of the mine life. The current mine plan
is based on the 2013 Mineral Reserve estimates, and will produce oxide and sulphide material to be processed through the existing heap leach facility and sulphide plant respectively over a 13-year mine life (2014 to 2026). Material movement peaks in
2014 with 637,807 kt, decreasing to 179,646 kt in the last year of operation in 2026.

A stockpiling strategy will be practiced. The mine plan considers the value of the blocks mined on a continuous basis combined with the expected concentrates quality. From time to time ore material with a NSR profit value between $0.05 and
$5.00 is stockpiled to process first higher-value ore. In some instances, the ore is segregated into stockpiles of known composition to allow for blending known quantities of material at the stockpile as required by the mill/customer.
Stockpiling at Peñasquito also allows for forward planning for ore quality to ensure optimal mill performance and consistent gold production to match, within the normal bounds of expected variability, the mine plan.

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The final pit will have one contiguous outline at surface but will consist of two distinct pit bottoms, one on the Peñasco Zone and one on the Chile Colorado (Brecha Azul) zone. Open pit mining is undertaken using a conventional
truck-and-shovel fleet. Drill patterns range from nine metres by nine metres in overburden to 4.3 metres by five metres in sulphide ore. The heap leach ore drill pattern is being adjusted as needed to ensure rock fragmentation of about 127 to 152
millimetres for leaching.

Metallurgical Process

The Peñasquito Mine consists of a leach facility that processes a nominal 25 ktpd of oxide ore and a sulphide plant that processes a nominal 115 ktpd of sulphide ore. Mine construction commenced in 2007. In October 2009, the first lead and
zinc concentrates were produced and concentrate shipment to smelters commenced with first sales recorded in November 2009.

Ore placement on the heap leach pad began in February 2008. On April 8, 2008, ore leaching was initiated and the first gold pour occurred on May 10, 2008. During the first three quarters of 2013, a total of 11,918,119 dry metric tonnes of ore were
placed on the leach pad. A total of 40,413 ounces of gold and 1,306,258 ounces of silver were produced from the oxide facility in the first three quarters of 2013. Over the life of mine gold and silver recovery from the oxide heap leach has
stabilised. Based on this data, future gold and silver recovery from the heap will be fixed at 57 percent for gold and 24 percent for silver.

Oxide Ore

Run-of-mine oxide ore is delivered to the heap leach pile from the mine by haul trucks. Lime is added to the ore, prior to addition of the ore to the pad. Ore is placed in ten metre lifts, and leached with cyanide solution. Pregnant leach solution
is clarified, filtered, and de-aerated, then treated with zinc dust to precipitate the precious metals. The precipitated metals are subsequently pressure filtered, and the filter cake smelted to produce doré.

Sulphide Ore

Run-of-mine sulphide ore is delivered to the crusher dump pocket from the mine by 290 tonne rear-dump–haul trucks. The crushing circuit is designed to process up to 148,000 tonnes per day of run-of-mine sulphide ore to 80 percent passing 159
millimetres. The crushing facility initially consisted of a gyratory crusher capable of operating at 92 percent utilization on a 24 hour per day, 365 days per year basis; a parallel in-pit crushing circuit has since been included to support higher
throughput.

For the first three quarters of 2013, a total of 29,005,248 dry metric tonnes of ore with an average grade of 0.42 grams per ton of gold, 21.79 grams per tonne of silver, 0.49 percent zinc and 0.25 percent lead was processed through the sulphide
plant facility, for a total of 249,237 ounces of gold, 15,599,950 ounces of silver, 237,657,000 pounds of zinc, and 121,979,000 pounds of lead produced (payable metal). Metallurgical recoveries averaged 64 percent for gold, 77 percent for silver, 75
percent for zinc, and 76 percent for lead.

Metallurgical Opportunities

Two upside opportunities have been identified, and evaluations of these opportunities are ongoing.

Concentrate Enrichment Process

Due to the complex nature of the orebody, the lead concentrate can contains relatively high levels of copper, arsenic and antimony. Goldcorp has evaluated processes for treatment of the copper concentrate for selective removal of arsenic and
antimony and is developing a process for this purpose whereby arsenic and antimony would be removed from the copper concentrate, with antimony recovered separately, and a potentially marketable copper concentrate, containing gold and silver, would
be produced.

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Pyrite Leach

The Peñasquito deposit contains gold, silver, lead, and zinc. Gold is primarily recovered into a lead concentrate, with recoveries typically in the 65 percent to 70 percent range. The majority of unrecovered gold is associated with pyrite,
which is not recovered by the current flotation process.

To increase overall gold (and silver) recovery, an evaluation is progressing to assess the viability of leaching a pyrite concentrate which will be recovered from the current zinc flotation tailing.  Preliminary metallurgical laboratory
investigations at the mine have developed a process for the generation of a gold- and silver-bearing pyrite concentrate. This concentrate can subsequently be ground and leached with cyanide to recover a portion of its precious metal content.

Mine Life

To support declaration of Mineral Reserves, Goldcorp prepared an economic analysis to confirm that the economics based on the Mineral Reserves over a 13 year mine life could repay life of mine operating and capital costs. The mine was evaluated on
an after-tax free cash flow basis. Results of this assessment indicated positive economics until the end of mine life, and supported Mineral Reserve declaration. Life of mine cash flow after annual sustaining capital requirements is US$5,249
million. Sensitivity analysis was performed on the base case life of mine after-tax net present value. The results of this analysis demonstrate that the financial outcome is most sensitive to operating costs. The next most sensitive parameters are
exchange rates, gold prices and gold production.

Markets / Contracts

Goldcorp currently has an operative refining agreement with Met Mex Penoles for refining of doré produced from the Project. Goldcorp’s bullion is sold on the spot market, by marketing experts retained in-house by Goldcorp. The terms
contained within the sales contracts are typical and consistent with standard industry practice, and are similar to contracts for the supply of doré elsewhere in the world. Part of the silver production is forward-sold to the Company.

The markets for the lead and zinc concentrates from the Peñasquito Mine are worldwide with smelters located in Mexico, North America, Asia and Europe. Metals prices are quoted for lead and zinc on the London Metals Exchange and for gold and
silver by the London Bullion Market Association. The metal payable terms and smelter treatment and refining charges for both lead and zinc concentrate represent typical terms for the market and qualities produced by the Peñasquito Mine. In
addition to the forward sales contract for silver production with the Company, Goldcorp has entered into sales and collar option agreements for the base metals volumes in relation to Peñasquito Mine concentrate sales.

Taxes

The income tax rate applicable to corporations in Mexico was increased from 28 percent to 30 percent effective January 1, 2014. In addition, a tax-deductible mining royalty of 7.5 percent on earnings before the deduction of interest, taxes,
depreciation and amortization, as well as an additional 0.5 percent royalty on precious metals revenue (applicable to precious metals mining companies) will be in effect as of January 1, 2014.

Environment

Various baseline studies, including with respect to water, air, noise, wildlife, forest resources and waste and materials have been completed.  Environmental permits are required by various Mexican Federal, State and municipal agencies, and are in
place for Project operations. The initial Project environmental impact assessment was authorized on December 18, 2006. This initial document was prepared based on a 50,000 tonnes per day production rate. Additional impact assessments for extensions
or modifications to increase permitted capacity to 150,000 tonnes per day have been filed and approved since 2008.

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Exploration and Development

Exploration potential remains under the current open pits, and
may support underground mining; such an alternative is under consideration
through planned conceptual-level engineering studies. The skarn and mantos
mineralization identified at depth may also support a potential underground
operation; studies are also planned to investigate this option. Currently no
underground Mineral Resources or Mineral Reserves are declared.

Production Information

The following table summarizes 2008 to 2013 silver production
(100% basis) from the Peñasquito Mine:

Oxides
    Units
    2008
    2009
    2010
    2011
    2012
    2013Produced Payable
      Gold
    (oz)
    20,000
    83,200
    78,399
    55,800
    42,669
    62,300Produced Payable
      Silver
    (oz)
    1,356,000
    2,600,000
    3,006,262
    1,891,000
    1,420,300
    1,684,100SulphidesProduced Payable
      Gold
    (oz)
    
    
    89,800
    198,300
    368,594
    341,500Produced Payable Silver
    (oz)
    
    
    10,946,400
    17,154,500
    22,284,558
    20,763,300


PASCUA-LAMA PROJECT, BORDER OF CHILE AND ARGENTINA

The following description of the Pascua-Lama Project is based
on the information disclosed in the annual information form of Barrick filed on
March 31, 2014. The Company QPs have approved the disclosure of scientific and
technical information in respect of the Pascua-Lama Project in this document.

General Information

The Pascua-Lama property is located in the Frontera District in
Chiles Region III and Argentinas San Juan Province. It straddles the
Chile-Argentina border and is approximately 150 kilometers southeast of the city
of Vallenar, Chile, 380 kilometres by road northwest of the city of San Juan,
Argentina and approximately 10 kilometers from the Veladero Mine. The total
project area consists of approximately 45,500 hectares in Chile and Argentina.
The Chilean part of the deposit, which is at an elevation of approximately 4,300
to 5,250 meters above sea level, was acquired by Barrick through its acquisition
of Lac Minerals in 1994. Lac Minerals acquired its interest in the property from
Bond Gold International in 1989. Exploration on the property dates back as far
as 1977. With respect to the portion of the project located in Argentina,
Barrick acquired certain of the mining concessions that form part of the project
in 1995. It acquired the remaining project mining concessions through its
acquisition of Exploraciones Mineras Argentinas S.A. from Minera S.A. in 1997.

In both Chile and Argentina, Barrick, through its wholly-owned
Argentinean subsidiary, Barrick Exploraciones Argentina S.A. (BEASA), and its
wholly-owned Chilean subsidiary, Compañia Minera Nevada SpA (CMN), owns the
mining property in the project area. The mining rights have no expiry date,
provided the applicable annual land payments are made.

The legislatures of both Chile and Argentina completed the
ratification of a Mining Treaty between the two countries in 2000. The Specific
Additional Protocol for the Pascua-Lama Project under the Mining Treaty was
signed into law by both countries in the third quarter of 2004. The Pascua-Lama
Project is within the area subject to the Mining Treaty (the Protocol Area)
and the project is entitled to enjoy the benefits to cross-border mining
operations that are granted by the Mining Treaty. An increase in the size of the
Protocol Area has been requested to include certain additional project-related
infrastructure. This request has been approved by Chile and is expected to be
approved by Argentina in due course. In April 2009, the authorities of Chile and
Argentina reached an agreement specific to the Pascua-Lama Project, which avoids
double taxation for the project under the rules of the Mining Treaty. The
provisions of the April 2009 agreement remain in force despite the termination
of several double taxation treaties by Argentina in 2012, including the general
1976 double taxation treaty with Chile.

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The Pascua-Lama property area is characterized by high mountain ranges and deep valleys with natural slopes of 20 to 40 degrees. Surface material consists of rock outcrops, alluvial and colluvial materials, which are primarily gravel, sand, silt and
clay. Vegetation is sparse. The area is considered to have a sub-arid, sub-polar, mountain climate. During the winter months, extreme weather may create a challenging operating environment. Recognizing this issue, the potential impact of possible
extreme weather conditions, to the extent possible, will be incorporated into the project’s operating plan. Access to the property is pursuant to a combination of public highways and private roads from both, Vallenar, Chile and San Juan,
Argentina.

Primary road access in Chile initially was via a 126 kilometer public road (route C 485) from the city of Vallenar, through the town of Alto del Carmen and several small communities to the Barrick property and 44 kilometers on Barrick private road
to the Protocol Area access control point at Tres Quebradas. The project recently completed the upgrade of 70 kilometers of an existing public road from Punta Colorada and the construction of 48 kilometers of new road to join the road from Alto del
Carmen which runs to the Barrick property.  Once inside the Protocol Area the road continues an additional 23 kilometres up to the entry to the mine site at La Mesa.

Primary access in Argentina will be by public highways to Tudcum, some 200 kilometers north of the San Juan Province capital city of San Juan and from there 157 kilometres on an existing private road to the access gate to Barrick ́s Veladero
Mine, and another 30 kilometres through the Veladero property to the Protocol Area. Once inside the Protocol Area, the road continues another five kilometres to the process plant site.

Sufficient surface rights have been obtained for current operations at the property.

Development

Construction on the Pascua-Lama Project began in October 2009.  During the fourth quarter of 2013, Barrick announced the temporary suspension of construction at the Pascua-Lama Project, except for those activities required for environmental and
regulatory compliance. Barrick had previously suspended construction activities on the Chilean side of the project, except for those activities deemed necessary for environmental protection, during the second quarter of 2013 as a result of the
issuance of a preliminary injunction.  This decision to suspend construction in Chile and Argentina will postpone and reduce near-term cash outlays, and allow Barrick to proceed with development at the appropriate time under a more effective, phased
approach. A decision to re-start will depend on improved project economics such as go-forward costs, the outlook for metal prices, and reduced uncertainty associated with legal and other regulatory requirements. The most significant of these
outstanding legal and regulatory matters include an environmental review process regarding the water quality baseline of the Río Estrecho, receipt of required approvals, legal challenges and instances of non-compliances relating to the
project’s water management system, including a recent decision from the Chilean environmental court, which CMN has appealed to the Chilean Supreme Court, in respect of such non-compliances that could result in the imposition of more severe
sanctions against the Chilean side of the project by Chile’s environmental regulator, an environmental damage claim regarding glaciers and a challenge to the project’s environmental approval process before the Inter-American Commission
on Human Rights (“IACHR”). For more information about these matters, see “Environment” section below.

Barrick anticipates total cash outflows for the Pascua-Lama Project of approximately $700 million in 2014, including approximately $300 million in expenditures for the ramp-down, care and maintenance, environmental and social obligations and
remaining capital expenditures, with the balance of the expected cash outflows reflecting the drawdown of amounts accrued for at the end of 2013. The ramp-down is progressing on schedule for completion by mid-2014. In the meantime, Barrick will
update and refine capital cost estimates and stage the project’s remaining development into distinct phases with specific work programs, budgets and objectives. This staged approach is expected to facilitate more efficient planning and
execution, more effective capital deployment, and improved cost control. In the interim, Barrick will explore opportunities to improve the project’s risk-adjusted returns, including strategic partnerships or royalty and other income streaming
agreements.

In 2009, Barrick entered into the Silver Purchase Agreement with the Company whereby it sold the equivalent of 25% of the life of mine Pascua-Lama silver production from the later of January 1, 2014 or completion of project construction, and 100% of
silver production from the Lagunas Norte Mine, Pierina Mine and Veladero Mine until that time. Barrick initiated the closure of the Pierina Mine in August 2013 and does not anticipate significant silver production from that mine in future years. In
return, Barrick was entitled to an upfront cash payment of $625 million payable over three years from the date of the agreement, as well as ongoing payments in cash of the lesser of $3.90 (subject to an annual inflation adjustment of 1%
starting three years after project completion at Pascua-Lama) and the prevailing
market price for
each ounce of silver delivered under the agreement. Barrick received the final cash installment payment of $137.5 million in 2012. Barrick had provided the Company with a completion guarantee, requiring Barrick to complete Pascua-Lama to at
least 75% design capacity by December 31, 2015. In 2013, the Company agreed to extend the completion date for Pascua-Lama to December 31, 2017 and will continue to receive silver production from the Lagunas Norte Mine, Pierina Mine (now in closure)
and Veladero Mine until December 31, 2016. If the requirements of the completion guarantee have not been satisfied by December 31, 2017, the agreement may be terminated by the Company, in which case the Company will be entitled to the return of the
upfront cash consideration paid less a credit for silver delivered up to the date of that event. At December 31, 2013, the remaining cash obligation was $365 million.

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To date, Barrick has identified over 1,500 permits and authorizations required for the construction, operation and/or closure of project facilities at Pascua-Lama in both countries. The project has obtained over 900 permits and the remaining permits
are expected to be obtained as required.

Barrick is aware of a number of actions that have been initiated against the Province of San Juan in Argentina relating to approvals granted in respect of or actions affecting the Pascua-Lama Project. Barrick is not a party to such actions and has
limited information with respect to the nature or status of the claims or complaints. In addition, certain other complaints and actions relating to the project have been brought against subsidiaries of Barrick. In 2011, Mountain-West Resources Inc.
(“MWR”) issued a series of false and misleading press releases in which MWR falsely claimed that the Chilean portion of the Pascua-Lama Project is not owned by Barrick but is instead owned by a third party who had granted MWR an option
to acquire 50% of that property. Barrick has advised MWR that these statements are false and misleading, and has vigorously opposed all attempts by MWR and its associates to interfere or otherwise challenge the ownership and possessory rights of
Barrick or its subsidiaries that are needed to develop the Pascua-Lama Project. Based on the information currently available to Barrick, none of these actions or complaints is believed to present a significant risk to the development of the
Pascua-Lama Project.

In 2007, the Huascoaltinos Agricultural Community filed a petition against the State of Chile before the IACHR claiming that certain of Barrick’s rights under the American Convention of Human Rights had been violated as a result of, amongst
other things, the State’s issuance of certain environmental approvals relating to the project. Barrick is not a party to the proceedings and Barrick believes that the petitioner’s claims are without merit. Depending on the decision
reached by the IACHR, the IACHR could, amongst other things, potentially impose precautionary measures on the State or recommend alterations to the conditions under which the project was approved or reopen its environmental review. Any such decision
could limit or suspend Barrick’s ability to develop the project, and could potentially affect Barrick’s ability to complete the project as it is currently designed.

In December 2013, the Province of San Juan, Argentina adopted a new provincial law that creates a registry of approved local suppliers to be administered by the provincial mining ministry.  In order to be designated as a “local
supplier,” a company must be based and domiciled in the Province of San Juan, and must also hire 80% of its work force from the Province of San Juan. The new law requires mining companies conducting exploration or exploitation activities in
the Province, such as Barrick, to allocate 75% of their annual purchases or contracts to such local suppliers. Barrick is currently evaluating a possible judicial or administrative challenge to the new law.

In April 2011, the Argentinean government implemented import controls on a greater number of goods. Delays associated with these import controls have the potential to affect certain aspects of Pascua-Lama’s operations, such as maintenance and
new construction that are dependent on imported goods. Barrick’s activities at Pascua-Lama were not impacted by these measures in 2013.

Geology

The Pascua-Lama Project is located in the high Andean Mountains, in what has been designated as the Eastern Belt of Hydrothermal Alteration. The gold, silver and copper mineralization at the Pascua-Lama Project is part of a mineralized acid sulfate
system that was structurally controlled within intrusive and volcanic rock sequences of Upper Paleozoic and Middle Tertiary age.

Basement rocks in the Pascua-Lama Project area are dominated by a multiphase granite pluton that may be a slightly younger upper Permian or lower Triassic phase of the Permian Guanaco Sonso sequence of intrusive and volcanics. In the deposit area,
the granite intrudes older diorites and volcanic pyroclastic units and is, in turn, intruded by diorite stocks and dykes of mid-Tertiary Bocatoma age. During Tertiary time, all of the previously described rocks were cut by sub-vertical fault zones
and hydrothermal breccias located at complex fault intersections.

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Numerous breccias bodies occur in the Esperanza, Quebrada de Pascua and Lama areas. At the surface, these breccias vary in size from outcrops measured in centimeters up to hundreds of meters. Typically the breccias show a strong correlation to zones
of intersection of two or more major structural zones. Breccia Central, the large inter mineral breccias pipe, occurs in the Quebrada de Pascua area. On the surface, this breccia body is about 650 meters long and up to 250 meters in width, while
underground, between 200 and 400 meters below the surface, the composite body measures about 550 meters in length and up to 130 meters in width. It extends to at least 700 meters below surface. This well mineralized breccia pipe is evidence of an
explosive hydrothermal event related to the formation of the Quebrada de Pascua ore deposit. Breccia Oeste and Breccia Sur are the two large post mineralization breccias pipe complexes located in the mine area. Oriented north/south along the Breccia
Oeste fault zone in the Esperanza area, the Breccia Oeste pipe measures up to 500 meters long, up to 150 meters wide, and extends up to 300 meters below surface.

Mineral Reserve and Mineral Resource Estimates

See “Technical Information – Summary of Mineral Reserves and Mineral Resources” for the estimated Mineral Reserves and Mineral Resources (silver only, 25% attributable) for the Pascua-Lama Project as of December 31, 2013.

Mining and Processing

The Pascua-Lama Project is designed as a large-scale open pit operation centered at an elevation of 4,800 meters with processing facilities having a designed throughput capacity of 45,000 tonnes per day.  Non-refractory oxide ore produced by the
mine will be subject to cyanide leaching, while refractory sulphide ore will be subjected to flotation prior to cyanide leaching of the flotation tailings.  Both ore types will be ground and washed. The development of the processing facilities has
been staged to reflect the expected composition of the ore over the mine life. Final products from the process include doré bullion and gold/silver/copper flotation concentrates.

The plant consists of primary crushing, wet grinding in autogenous mills, ball milling, CCD washing, pre-aeration, oxygen assisted cyanide leaching, CCD thickening for pregnant solution recovery, neutralization, cyanide detoxification, cementation
using Merrill-Crowe, retorting, smelting and tailings deposition.  For the treatment of the refractory ore, a flotation circuit will be added. The processing plant is designed to operate 24 hours a day, 365 days per year. The average design
throughput is approximately 2,000 tonnes per hour. Based on existing reserves and anticipated production capacity, the expected mine life will be approximately 25 years.

During years 1 and 2, the process facility is designed to process 45,000 tonnes per day of non-refractory ore through three mill lines (Phase 1). In the late first quarter of year 3, a flotation facility will be added and refractory ore will be
introduced to one of the mill lines at the rate of 15,000 tonnes per day (Phase 2). During this phase, which continues throughout the remainder of the mine life, the remaining two mill lines continue to process non-refractory ore at 30,000 tonnes
per day. Recovered gold and silver from the leach circuit will be smelted into doré on-site and shipped to an outside refinery for processing into bullion. During the mine life refractory ore in the form of gold/silver/copper concentrate will
be sold to an offsite smelter.

Until permanent power is required at site, temporary construction power will be provided by diesel generator. The temporary construction generators will be suitable for use as emergency back-up generators during operations in the event of a primary
power failure. Permanent electrical power for the project will be provided by a single circuit 220 kilovolts 106 kilometres line from a main substation connected to the Chile main Central Interconnected grid System (SIC) near Punta Colorada
(Coquimbo Region) to a substation near the Protocol Area Access Control point in Chile. From there, separate 220 kilovolt lines will be provided for power supply to the substations located at the process plant in Argentina (47 kilometres) and the
mine facilities in Chile (23 kilometres). The construction of the primary power supply system was completed in mid-2013.

Environment

The Pascua-Lama Project environmental permit was submitted to both Chilean and Argentine authorities in 2000. The Pascua-Lama Project received conditional Environmental Impact Assessment (“EIA”) approval from appropriate authorities in
Chile in April 2001 and, in December 2004, CMN submitted a second EIA in respect of modifications of the project.  CMN received conditional approval of the EIA from Chilean environmental regulatory authorities in February 2006. In San Juan Province,
BEASA submitted an Environmental Impact Report (Informe de Impacto Ambiental, “IIA”) in 2000 to support the environmental approval process for the Argentine components of the project.  In 2004, BEASA
developed an updated IIA assessing the cumulative environmental impacts of the Pascua-Lama Project and the nearby Veladero Mine.  BEASA received conditional approval of the project from the San Juan, Argentina environmental regulatory authority in
December 2006.  Under Argentine law BEASA is required to update the IIA at least every two years. To date, BEASA has submitted four IIA updates, with the last update submitted on March 14, 2014.

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All environmental aspects of Pascua-Lama were reviewed during the course of the Argentine and Chilean environmental assessments.  CMN and BEASA have developed environmental management plans addressing the key environmental aspects of the project for
construction and operation phases. Most of the ore and waste rock to be excavated from the open pit is defined as potentially acid generating due to its geochemical characteristics. In the upper Estrecho valley in Chile where the waste rock will be
stockpiled, project development plans include a water management system to divert non-contact waters around the waste rock facility and to collect and treat any drainage from the waste rock. Treated water will be utilized in the mine for industrial
purposes (mainly fugitive dust control) and discharged within environmental and sectorial standards to the Río Estrecho.

Operational failures occurred in December 2012 and January 2013 in the project’s non-contact water management system. CMN reported these instances of non-compliance to Chile’s environmental regulator (the Superintendencia del Medio
Ambiente or “SMA”).  In May 2013, CMN received a resolution from the SMA (the “SMA Resolution”) that requires the company to complete the water management system in accordance with the project’s environmental permit
before resuming construction activities in Chile, and also required CMN to pay a $16 million administrative fine. Barrick paid the fine in May 2013 and submitted a compliance plan to the SMA to complete the water management system, subject to
regulatory approval of specific environmental and sectorial permit applications. In June 2013, a group of local farmers and indigenous communities challenged the adequacy of the fine imposed by the SMA Resolution and requested more severe sanctions
against CMN. On March 3, 2014, the Chilean Environmental Court annulled the SMA Resolution and remanded the matter back to the SMA for further consideration in accordance with its decision. A new resolution from the SMA could include more severe
sanctions against CMN such as an increase in the amount of the fine above the approximately $16 million paid by Barrick in May 2013 and/or the revocation of the project’s environmental permit. The Environmental Court did not annul the
portion of the SMA Resolution that required Barrick to halt construction on the Chilean side of the project until the water management system is completed in accordance with the environmental permit. On March 20, 2014, CMN filed an appeal to the
Chilean Supreme Court requesting the annulment of the March 3, 2014 decision of the Environmental Court and the issuance by the Chilean Supreme Court of a new decision in the matter. The SMA has not filed a challenge to the Environmental Court
decision.

Even if the project’s water management system is completed to the satisfaction of the SMA, a decision to re-start construction will still be contingent upon improved project economics and the resolution of other outstanding legal proceedings
(see “– Development” above). In addition to the challenge to the SMA Resolution referenced above, a group of local farmers has also filed an environmental damage claim against CMN alleging damage to glaciers in the Pascua-Lama
Project area.

CMN initiated a review of the baseline water quality of the Río Estrecho in August 2013 as required by a July 15, 2013 decision of the Court of Appeals of Copiapo, Chile. The purpose of the review is to establish whether the water quality
baseline has changed since the project received its environmental approval in February 2006 and, if so, to require CMN to adopt the appropriate corrective measures. Such actions could include changes to the manner in which the water quality of the
Río Estrecho is measured as well as potentially significant modifications to the project’s environmental monitoring and water management systems, as determined by the relevant Chilean environmental authorities. CMN has requested that
certain aspects of its environmental approval relating to water quality be held in abeyance while this review is ongoing. This request remains under consideration by Chile’s environmental authorities. Barrick currently expects the baseline
water quality review to be completed by the end of 2014, subject to any changes to the existing scope of the review and the outcome of the challenge to the SMA Resolution referenced above.

In Argentina, the process plant will utilize sodium cyanide to recover gold and silver from the ore. The process plant and tailings storage facility have been designed to prevent process solutions from being released to surface water or groundwater.
These facilities will be lined and will include seepage detection and collection systems. The facilities will also include treatment through a cyanide destruction circuit. Management procedures for cyanide handling, monitoring and transportation in
accordance with the International Cyanide Management Code are being implemented for the project.

On September 30, 2010, the National Law on Minimum Requirements for the
Protection of Glaciers was enacted in Argentina, and came into force in early
November 2010. The federal law bans new mining exploration and exploitation
activities on glaciers and in the peri-glacial environment, and subjects
ongoing mining activities to an environmental
audit.  If such audit identifies significant impacts on glaciers and peri-glacial environment, the relevant authority is empowered to take action, which according to the legislation could include the suspension or relocation of the activity. In the
case of the Pascua-Lama Project, the competent authority is the Province of San Juan.  In late January 2013, the Province announced that it had completed the required environmental audit, which concluded that Pascua- Lama has not impacted glaciers
or peri-glaciers.

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At December 31, 2013, the recorded amount of estimated future reclamation and closure costs that were recorded under IFRS as defined by IAS 37, and that have been updated each reporting was approximately $103.7 million.

Exploration, Drilling and Analysis

As of December 31, 2013, the drill hole database used to support the development of mineral resources for the Pascua-Lama property contains 1,222 reverse circulation holes, 300 diamond drill core holes, 282 underground diamond drill core holes,
1,785 underground channel samples, 577 surface channel samples, 204 metallurgical samples and 20 muck samples. The gold and silver resources have been estimated from representative samples taken from 330,971 meters of reverse circulation holes,
82,288 meters of diamond drill holes, 66,980 meters of underground diamond drill holes, 16,496 meters of underground channel samples and 16,254 meters of channel samples.  The drill hole spacing is variable, approximately 30 to 50 meters in the
Esperanza area and 50 to 80 meters in the Pascua area. No exploration drilling is currently planned for 2014.

Drill samples collected for use in geologic modeling and mineral resource estimation are under the direct supervision of the geology department at Pascua-Lama.  All drill hole collar, survey and assay information used in modeling and resource
estimation are externally and internally verified and approved by the staff geologists prior to entry into the mine-wide database.  Sample preparation and analyses are conducted by independent laboratories in Santiago, Chile. Procedures are employed
to ensure security of samples during their delivery from the drill rig to the laboratory. The quality assurance procedures, data verification and assay protocols used in connection with drilling and sampling on the Pascua-Lama property conform to
industry accepted quality control methods.

Regular internal auditing of the mineral reserve and mineral resource estimation processes and procedures are conducted.

Royalties and Taxes

Pursuant to federal legislation which implemented law 24.196 in May 1993, and Provincial legislation adhering to the same, operating mines are required to pay to the Provincial government a royalty of up to 3% Boca Mina for minerals extracted from
Argentinean soil.  This Boca Mina is defined as the sales value of the extracted minerals less certain permitted expenses. In addition, Barrick is obligated to pay a gross proceeds sliding scale royalty on gold produced from the Pascua-Lama
properties located in Chile ranging from 1.433% to 9.555% and a 1.91% net smelter royalty on copper produced from the properties. In addition, a step-scale 5% or 7.5% gross proceeds royalty on gold produced and a sliding scale net smelter royalty of
0.5% to 6% on all products other than gold and silver is payable in respect of certain portions of the property located in Argentina, not currently included in the mine plan. The sliding scale and step-scale royalties on gold increase with rising
spot gold prices.

In 2002, as an emergency measure, Argentina adopted a 5% export duty on certain mineral products, including gold. At the time, the duty was described as “temporary”. Export of gold doré from Barrick’s Veladero Mine is
currently subject to this duty. Should such export duty continue to be in place at the time that the Company commences production from Pascua-Lama, only production from ore extracted in Argentina will be subjected to such duty.

In October 2011, the Argentinean government issued Decree 1722, which requires crude oil, natural gas, and mining companies to repatriate and convert all foreign currency revenues resulting from export transactions into Argentine pesos. A bank
transaction tax of 0.6% applies to both the initial conversion of foreign currency revenues into pesos and the subsequent conversion of pesos to foreign currencies.

In September 2013, Argentina adopted a new 10% tax on dividends paid by Argentine entities to individuals and non-resident investors. Barrick believes that this withholding tax is not applicable to dividends to be paid by the Argentine side of the
Pascua-Lama Project as a result of an existing tax stability arrangement.

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SALOBO MINE, BRAZIL

Christopher Jacobs, CEng MIMMM, Vice President and Mining Economist, Micon International Ltd.,  James Turner, BSc (Hons) MSc CEng MIMMM, Senior Mineral Process Engineer, Micon International Ltd., Barnard Foo, P. Eng., M. Eng, MBA, Senior Mining
Engineer, Micon International Ltd. and Jason Ché Osmond, Senior Geologist, Micon International Ltd. prepared a technical report in accordance with NI 43-101 entitled “Technical Report on the Mineral Reserves and Mineral Resources of the
Salobo Copper-Gold Mine Carajás, Pará State, Brazil” dated March 19, 2013 (the “Salobo Report”). Christopher Jacobs, James Turner, Barnard Foo and Jason Ché Osmond are qualified persons under NI 43-101. The
following description of the Salobo Mine has been summarized from the Salobo Report and readers should consult the Salobo Report to obtain further particulars regarding the Salobo Mine. A copy of the Salobo Report is available under the
Company’s profile on SEDAR at www.sedar.com.

Property Description and Location

The Salobo Mine is a copper-gold deposit located approximately 80 kilometres northwest of Carajás, Pará State in northern Brazil. Geographic coordinates for the property are 5°47’25” S latitude and
50°32’5” W longitude.

The Salobo Mine comprises a single claim and is permitted for mining copper and gold under National Department of Mineral Production (“DNPM”) 807.426/74. The area of the property is 9,180.61 hectares, as defined by Exploration Permit no.
1121, dated 14 July, 1987. Brazilian legislation separates the ownership of the surface rights from mineral ownership. A mining company can operate a mine even if does not own the surface, provided it owns the minerals. In this case it is necessary
to pay a royalty to the surface owner. The royalty is calculated as 50% of the CFEM (Compensation for Financial Exploitation of Mineral Resources), which is paid to the government. The mining concessions are updated every year on presentation by
Vale of the annual report of mining production to the DNPM. The Salobo Mine received its first Operating Licence No. 1096/2012 on November 5, 2012, valid for four years. Vale maintains that the company holds clear mineral title to the deposit areas
and has the necessary permits for operation of the mine.

The area is well-served by railroads and highways that connect the seaport and other cities.  Air service is available at the Carajás airport, which is approximately 70 kilometres southeast of Salobo and is capable of receiving commercial
aircraft.  There are regular flights to Belém (capital city of Pará state, population 2 million) and to other Brazilian cities. The city of Marabá is approximately 240 kilometres east-northeast from Salobo by highway.

Accessibility, Climate, Local Resources, Infrastructure and Physiography

The tropical climate, typical of the Amazon region, is humid and hot with a temperature ranging from 17 degrees Celsius to 32 degrees Celsius, and averaging 27 degrees Celsius. The average humidity is about 76 percent and the average annual rainfall
is approximately 192 centimetres. The rainy season extends from December to April, with most rainfall occurring in February and March.

In the Salobo Mine area, surface elevations range from 190 to 520 metres, compared to the elevation of 850 metres attained on the Carajás Ridge to the southeast.  The topography is fairly steep: the Salobo ridge, where the deposit is located,
has a nominal slope of 2.5H:1.0V.  On either side of the Salobo ridge are the Cinzento and Salobo Rivers, respectively, both of which flow into the Itacaiúnas River. The latter flows into the Tocantins River, close to the city of
Marabá.

Salobo is within the Flona de Tapirape-Aquiri national forest which is 190,000 hectares in area. The deposit is in the northwestern portion of the Carajás Reserve. The main ecosystem is tropical forest, which is dominated by relatively dense
trees with substantial brush in the under-storey.

Mining is the primary industry of the area. As well as Salobo, Vale also operates a very large iron ore mine at Carajás, and the established Sossego copper mine.

Concentrate produced at the mine is hauled by 40 tonne (gross weight) highway trucks 85 kilometres on the highway to a rail-loading site located approximately ten kilometres north of the town of Parauapebas. From there, it is transported by train
870 kilometres to Itaqui port located near the coastal city of São Luís in the State of Maranhão.

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Electrical energy is supplied from Tucuruí, a 8,370 megawatt hydroelectric generating station on the Tocantins River, 200 kilometres north of Marabá, and 250 kilometres due north of Parauapebas.  An 87 kilometre overhead transmission
line (230 kilovolts) supplies the Salobo site. There is no ring feed.

Process make-up water comprises runoff and direct precipitation within the tailings storage basin. This raw water is pumped up to the plant together with return water from tailings deposited in the storage facility. At the time of Micon’s
visit, excess water was being discharged from the tailings storage facility (“TSF”).

The Salobo TSF, comprising an earth dam and concrete-lined spillway, was designed for Vale by Brazilian engineering company BVP Engenharia to withstand a one in 10,000 year event. The TSF, when completed to a height of 285 metres, will have
sufficient capacity to store tailings resulting from the planned 40 years of production. At present, work is underway to lift the impoundment from 170 metres above sea level to an intermediate design height of 220 metres above sea level.
Potentially, the TSF site could also store the material presently identified as mineral resources.

History

The Salobo copper deposit was discovered in 1974 during exploration carried out by Companhia Vale do Rio Doce, now known as Vale (“CVRD”) personnel. In 1977, a detailed exploration program commenced and in 1978 the presence of copper
sulphides associated with magnetic schist was confirmed and the first drill hole was completed that intersected a mineralized interval of 140 metres at 0.45 percent Copper.

From 1985 to 1987, a pilot-scale study was carried out at Salobo and, in July, 1987, mining rights were awarded to CVRD. On 29 June, 1993, Salobo Metais S.A. (“SMSA”) was created as a joint venture between CVRD and Morro Velho Mining, to
further study the economic viability of the deposit. In 1997, almost 30,000 metres of drilling was completed to support a pre-feasibility study directed by MRDI. This was followed in 1998 with the first feasibility study. Subsequently in 2001, a
revised feasibility study was completed by Kvaerner, which was then updated in 2002 by AMEC E&C Services Inc. CVRD acquired a controlling interest in the property in June, 2002.

The period 2002 and 2003 saw an additional 72,000 metres of drilling completed. There followed a number of independent mineral resource models and audits by Snowden (2003), Golder and AMEC (2004), Pincock, Allen and Holt (2005 and 2008), and Golder
(2010). The latter went on to prepare the current (2012) block model and Mineral Resource estimate. The definitive feasibility study was completed by Fluor JPS in June, 2004.

In 2007, CVRD changed its name to Vale S.A.

Pre-stripping operations were commenced at the Salobo Mine in 2009, and the Phase I process plant commenced commissioning and ramp-up in June, 2012. Phase II construction is now well advanced and is expected to be complete in 2014.

Geology and Mineralization

Regional Geology

The Carajás Mining District, located in the southeast of Pará State, Brazil, is a unique geologic feature covering an area of about 30,000 square kilometres (300 kilometres by 100 kilometres), between the Xingu and Tocantins / Araguaia
Rivers.

The Carajás Province is a major late Archean basin, deformed into a sigmoid shape, trending west-northwest – east-southeast. The Carajás sigmoid shape is further defined by several major west-northwest – east-southeast
lineaments such as the Carajás and Cigano sinistral fault zones. Northeast and northwest fault systems crosscut the region.

The Carajás Archean volcano-sedimentary sequence is composed mainly of bimodal volcanic, chemical sediments, including the gigantic banded iron formations (BIF) that host the largest iron deposits in the world, and pyroclastic and clastic
sediments. Several Archean intrusive units, the calc-alkaline Plaquê Suite (2.77 billion years old), and the alkaline Salobo and Estrela granites (2.5 billion years old), are known to have a strong correlation with copper–gold
mineralization in Carajás.  There are many generations of mafic bodies including some that are post-mineral dykes. A Proterozoic suite (1.88 billion years old) of alkaline granites, the central Carajás granite, Cigano, and Pojuca
granites, also intrude the Carajás sequence. Several generations of younger mafic dykes crosscut the entire sequence.

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The Carajás volcano-sedimentary sequence has been locally named
the Itacaiúnas Supergroup, which has been tentatively divided from top to the
bottom into:

| | I.   | Igarapé Bahia Group  is composed of mafic volcanic:
      lavas, tuffs and breccias, meta-sediments and BIF, with deposits of
      copper, copper-iron, copper-gold-Mo-silver including the Igarapé Bahia (18
      million tonnes at 4.0 grams per tonne gold in the weathering profile) and
      Alemão/Bahia deposits (120 million tonnes at 1.1 percent copper and 1.5
      grams per tonne gold). The Serra Pelada oxide-gold deposit is hosted by an
      overlying clastic metasedimentary sequence.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | II.  | Grão Pará Group - consists of the basal Parauapebas
      Formation made up of bimodal volcanic rocks with various degrees of
      hydrothermal alteration, metamorphism and deformation. The Parauapebas is
      overlain by the Carajás Formation, which hosts the gigantic Fe deposits
      (18 Bt at 15 percent iron).                                                                                                                                                                                   
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | III. | Igarapé Pojuca Group - comprises basic to intermediate
      volcanics (frequently with cordierite- anthophyllite alteration),
      amphibolites, gneisses and chemical sediments (cherts), BIF of
      oxide-silicate facies and schists of various compositions. The BIF unit
      hosts the Pojuca copper-zinc deposit.                                                                                                                                                                                   
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | IV.  | The Igarapé Salobo Group  is composed of iron-rich
      sediments associated with quartzites and gneisses, amphibolite facies of
      metamorphism, which includes the Salobo copper-gold
  deposit.                                                                                                                                                                                                                                                                                                         

The basement of the Carajás sequence comprises a gneissic
terrain with remnants of Archean greenstone belts. Copper and gold
mineralization within the province is associated with Archean felsic intrusives
(Plaquê and Estrela Granites). Proterozoic anorogenic felsic intrusives (dykes)
and Mesozoic mafic dykes crosscut the Carajás Sequence and the gneissic terrain.

The Salobo and Sossego goldcopper deposits lie within the
Carajás belt of the Amazon craton. Basement rocks comprise gneisses and
migmatites of the Xingu Complex and orthogranulites of the Pium Complex that
were metamorphosed at about 2.8 Ga. In the Carajás belt, the basement assemblage
defines a broad, steeply dipping, east-west trending ductile shear zone
(Itacaiúnas shear zone), which experienced multiple episodes of reactivation
during the Achaean and Palaeoproterozoic. Unconformably overlying the basement
is a sequence of volcano-sedimentary rocks of Archaean age (2.75 billion years
ago), the Itacaiúnas Supergroup. The basal unit is the Grão Pará Group that
includes greenschist-facies metamorphosed metavolcanic rocks and BIF.

Sandstone and siltstone deposited in a shallow marine to
fluvial environment (Águas Claras Formation), dated at 2.645 billion years old
to 2.681 billion years old, overlie the volcanic rocks of the Grão Pará Group.
The volcano-sedimentary sequence has been intruded by granitic rocks of various
ages. Palaeoproterozoic intrusions (ca. 1.88 billion years old) include several
anorogenic granitic plutons, such as the Central Carajás and Cigano granitoids.
Achaean intrusions include granitoids and diorites of the Plaquê Suite (ca. 2.74
billion years old), younger alkaline granitoids (ca. 2.57 billion years old),
such as the Estrela Complex, the Old Salobo Granite (2.573 ± 0.002 billion years
old) and the Itacaiúnas Granite.

Property Geology

The Salobo mineralization is hosted in the biotite-magnetite
(BDX) and amphibolite magnetite schists (XMT) along the trend of a steeply
dipping sequence of metamorphic rocks. Granitic intrusives (granitoid, GR) occur
adjacent to the north side of the sequence of rocks and a series of much younger
diorite dykes (diabase, DB) crosscut the mineralization forming barren zones.
Copper mineralization occurs as chalcocite and bornite, with subordinate
quantities of chalcopyrite, together with variable proportions of molybdenite,
cobaltite, covellite, gold and silver, contained in schists with variable
proportions of magnetite, amphibole, olivine, garnet, biotite, quartz and
plagioclase. Brittle-ductile shear zoned deformation has resulted in lenticular
shaped ore shoots that characteristically show close associations between copper
mineralization and magnetite contents.

Near-surface weathering of the bedrock in the deposit area has
produced a humid, clayey saprolite surface layer. The sulphide mineralization in
the upper 20 metres to 25 metres part of the saprolite has been oxidized, while
the lower five metres to ten metres of the saprolite contains variable
sulphides, and is transitional downward into fresh, sulphide-bearing bedrock.
The oxide saprolite layer has been partially leached by groundwater resulting in
a significant reduction in the copper and gold content. The sulphide saprolite
is a transitional unit for which leaching has also reduced the copper and
gold content, but to a lesser degree than the oxide saprolite. The lack of sulphides and the reduced grade in the oxide saprolite prohibits it from currently being considered of economic interest.

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Magnetite Schist (XMT)

XMT is represented by massive, foliated and banded rocks, with predominant magnetite, fayalite, grunerite, almandine and secondary biotite. Granoblastic textures with polygonal contacts in magnetite and fayalite are common. The presence of fayalite
is marked by the replacement of grunerite and greenalite and transformation into magnetite and other sulphides. Iron-potassic alteration is common, creating schistosity in biotite units.

The southeast portion of the deposit hosts hastingsite, replaced partially by actinolite, grunerite and sulphide minerals.  Fluorite, apatite, graphite and uranium oxides are associated with this assemblage, Fe-silicate minerals and alteration
products of fayalite.

Garnet-Grunerite Schist (DGRX)

These are massive rocks with local development of schistosity.  The rocks with significant almandine and grunerite content have isotropic texture or very few schistosity structures, with nematoblastic and granoblastic texture. The main mineralogical
composition consists of almandine and cummingtonite-grunerite, with magnetite, hematite, ilmenite, biotite, quartz, chlorite, tourmaline and subordinate allanite. Fluorite and uraninite generally occur in veinlets related to stilpnomelane, calcite
and grunerite.

Biotite Schist (BDX)

This unit is the most common lithology at Salobo and consists of medium to coarse-grained material with anastomosed foliation. The mineral assembly is characterized by biotite (responsible for the foliation observed within the rocks), garnet,
quartz, magnetite and chlorite.  The assemblage with garnet, magnetite, grunerite and biotite is partially replaced by a second generation of biotite and magnetite with chlorite, K feldspar, quartz, hematite and sulphides. Tourmaline, apatite,
allanite, graphite and fluorite generally occur throughout this unit.

Feldspar-Chlorite Mylonite (ML)

The feldspar-chlorite-quartz mylonite is characterized by mylonitic foliation, produced by the orientation of rims of chloritized deformed biotite, hastingsite, elongated quartz and saussuritized plagioclase (K-feldspar, epidote and muscovite
alteration). Porphyroblastic garnet is partially or totally replaced by chlorite and epidote. Allanite and apatite generally occur throughout this lithology.

Metavolcanic Basic (MTB)

This group of massive coarse-grained rocks is characterized by Fe-hastingsite and/or hornblende and plagioclase with chlorite alteration.  It occurs irregularly in the system, but is concordant with other lithotypes in abrupt contacts, probably
hydrothermally altered intrusive basic relicts within the package of volcanic rocks.

Quartz Mylonites (QML)

Quartz mylonites are grey or white in colour, passing through green to red. Where present, Fe-oxides are medium to fine grained, foliated and composed predominantly of quartz, muscovite, sericite, sillimanite and chlorite. Accessories, such as
biotite, feldspar, magnetite, almandine, tourmaline, zircon and allanite are common. It is possible to differentiate: (a) red quartz-feldspathic rocks formed by K-feldspar and quartz and which may be a product of shearing between the gneissic
basement and the supracrustal rocks; and (b) chlorite schists, mainly composed of chlorite and quartz, that represent intense hydrothermal alteration. This unit is found near the southern border of the deposits, close to important brittle shear
zones, which may be interpreted as conduits for hydrothermal fluids.

Old Salobo Granite (GR)

The Old Salobo Granite occurs as a stockwork of approximately 2,573 ±2 million years old. The rocks appear colorless-pink to grey, coarse grained and with mylonitization
in some areas. The main mineralogy is composed of K-feldspar (orthoclase-microcline), oligoclase, quartz, augite, hornblende, chlorite and, rarely, magnetite.  There is no evidence of contact metamorphism with the host rocks. The mylonitic aspects that appear both in granite and host rocks are likely
to have formed during the deformation phase.

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Young Salobo Granite (GR)

The Young Salobo Granite occurs as small northwest-trending sills, hosted by the supracrustal sequence and by the gneisses of basement. It corresponds to the youngest granitic intrusion detected by drilling in the Salobo area. In some porphyritic
portions, the matrix is aphanitic, containing a porphyry of red albite (Fe-oxide in micro-fractures) and chlorite pseudomorphed by biotite. This mineral assemblage is composed of fine to medium grained, equigranular, hypidiomorphic grains of
albite/oligoclase, orthoclase, quartz, chlorite, with minor epidote, zircon, fluorite, magnetite, chalcopyrite and pyrite. Deformation was not observed and the structure is isotropic. Age dating indicates an age of 1,880 ±80 million years
old.

Diabase (DB)

Diabase is located in southeast of the deposit, striking at approximately N70°E, while in the northwest of the deposit striking near to N20°W. The predominant minerals comprising the rock type are augite, plagioclase, magnetite, ilmenite and
quartz. The fine grained diabase has an age of 553 ±32 million years old, while the more granular margins are dated at 561 ±16 million years old. This unit represent the last magmatic event of the area. The dykes are set within
shear/fault lateral geometries to (N70°E) and frontal geometries (N20°W), probably developed before the intrusions, in a compressional regime modified by an extensive regime.

Rhyolite (RIO)

Rhyolite dykes are grey-reddish in colour, porphyritic in texture within an aphanitic matrix.  The majority are composed of K-feldspars, plagioclase, quartz, amphibole in a matrix cut by quartz veinlets. In drill holes the occurrence is rare or an
ultimate phase.

Mineralization

The sulphide mineralization consists of assemblages of magnetite-chalcopyrite-bornite and magnetite bornite- chalcocite. Variable amounts of molybdenite, cobaltite, safflorite, gold and silver, also exist hosted by rocks which contain magnetite,
fayalite, grunerite, garnet, biotite, quartz and plagioclase.  The mineralization is related to Fe-rich rocks and occurs in lenticular shears and hydrothermally altered zones. The chalcopyrite is associated with magnetite schists (XMT) rich in
fayalite and magnetite.

Different styles of mineralization can be found: disseminated, with planar structures (stringers) parallel to rock, associated with local concentrations of magnetite and/or garnet, filling or surrounding the fractures of mineral grains (stock
works); in cleavages of amphiboles and platy minerals, consisting of massive sulphide, parallel to bedding of hosted rocks in some cases, as well as remobilized mineralization in shear zones.  Chalcopyrite, bornite, and chalcocite occur
interstitially in silicate minerals. These sulphide minerals are commonly found filling the cleavage planes of biotite and grunerite.  Hematite is rare but, in places, comprises as much as four percent by volume.  It exhibits tabular texture
(specularite), with infilling bornite and partial replacement by magnetite.

Native gold grains are observed locally, mainly occurring as inclusions in cobaltite and safflorite or interstitial to bornite.  In addition, ilmenite, uraninite, allanite, fluorite and apatite occur as accessory minerals.  The above textural
relationships indicate that mineralization was firstly marked by an oxide stage, with a subsequent sulphide stage.

Molybdenite occurs interstitial to magnetite, and shows cleavages planes filled with chalcopyrite and bornite. In mylonitic samples, molybdenite forms kinked stringers with marked variable extinction, the result of in-lath recrystallization.

Magnetite occurs mainly as idiomorphic to sub-diomorphic grains, interstitial to silicate minerals or in fractures, or forms bands in mylonitic rocks.

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The gangue minerals are almandine, garnet, grunerite and tourmaline, reflecting the intense iron-metasomatism. Minor amounts of fayalite and hastingsite are pseudomorphed by grunerite and magnetite. Tourmaline, with a dominant schorlitic composition
occurs as idiomorphic crystals preferentially oriented parallel to mylonitic foliation, in association with biotite, garnet and grunerite.

Biotite sub-diomorphic crystals, commonly kinked, are associated with potassic alteration and spatially related to the copper-gold mineralization. In addition, uraninite and zircon inclusions may be locally abundant in biotite. Quartz shows undulose
extinction, and is associated with biotite in ore samples or constitutes concordant veins within the host rocks.

Hydrothermal alteration appears to be much more important than previously recognized. The spatial distribution of hydrothermal alteration in the Salobo deposit shows that areas affected by intense irons and potassic-metasomatism host most of the
iron oxide copper-gold ore.

In general, the massive magnetite associated with the mineralization is the core of the hydrothermal system and is surrounded by less intensely altered rocks. Within the massive magnetite body are small veins and irregular masses of secondary
biotite. Garnet is completely replaced by magnetite, forming obvious pseudomorphs. Away from the massive magnetite, the magnetite gradually diminishes, giving way to biotite garnet schist and/or garnet grunerite schist. When not obscured by
magnetite, biotite-garnet schist and garnet-grunerite schist are very distinctive and easily logged.  Alkali-metasomatism is recognized in the amphibolite rocks of the Salobo deposit. It is expressed by weak sodium with intense superimposed
potassium alteration (≤ 4.6 wt% of K2O).

Potassium–felsdpar, biotite and oligoclase are in the main alteration minerals. A significant increase in the FeO content (≤35 wt%) accompanied the potassium alteration in amphibolite and was marked by the replacement of calcic-amphibole
(mostly magnesium-hornblende and hastingsite) by iron-magnesium amphibole (cummingtonite), and by formation of biotite and magnetite. The chemistry of the meta-graywackes at the deposit indicates that they also underwent significant iron and
potassium alteration.  Alteration assemblages are characterized by almandine, garnet, biotite and grunerite, subordinate tourmaline and minor magnetite. The richest ore zone, located in the central part of the deposit, corresponds to the most
altered area.

Exploration

The discovery of the Salobo copper deposit occurred during a systematic program of geochemical, geophysical and geological exploration in the Carajás region, initiated by CVRD/DOCEGEO in 1974.

In 1977 a program of detailed geological and geochemical work explored magnetic anomalies existing in the basin of Igarapé Salobo (Salobo stream). Anomalies of up to 2,700 parts per million copper were detected in stream sediments collected
from tributaries of Igarapé Salobo.  These anomalies lead to the development of detailed work in the area, involving geological, geochemical and geophysical prospecting.  In 1978, exploration revealed the presence of copper sulphides
associated with magnetic schist and the first phase of several drilling programs was initiated.

The primary method employed in the exploration and evaluation of the Salobo deposit is diamond core drilling, details of which are presented below.

Drilling

The geochemical and geophysical anomalies identified at Salobo were initially tested by nine exploratory drill holes by DOCEGEO in 1978, including a mineralized interval of 140 metres at 0.45 percent copper. A successive drilling campaign (the first
of five major campaigns), to follow-up this promising mineralization, was conducted on a 400 metre by 200 metre drill grid, subsequently reduced to 200 metres by 200 metres and then to 200 metres by 100 metres. This initial campaign completed 65
diamond drill holes for 29,322 metres between March, 1978 and May, 1983.

The second campaign (January, 1986 to June, 1987) was jointly undertaken by CVRD/GICOR that reduced the grid to 100 metres by 100 metres in the core of the deposit with further drilling undertaken in the southeast of the deposit from the adit (G-3).
This phase completed 9,033 metres of diamond drilling from 60 drill holes.

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In 1993, and to accompany an economic feasibility study by SMSA, a third campaign was initiated. The primary objective was to investigate the best probable location in the deposit in which to commence mining and to optimize the first five years of
production as well as investigate mineralized continuity at depth. Between July, 1993 and February, 1994 a total of 65 drill holes had been completed for 14,585 metres.

In 1997, the fourth drilling campaign commenced, accounting for 25,491 metres from 88 holes.

The fifth drilling campaign completed 190 drill holes for 66,243 metres in 2002 and a further 2,047 metres in 2003 that brought the grand total for the Salobo deposit to almost 147,000 metres of geological drilling.

By the end of the campaigns in 2003, some areas were drilled a little more densely (50 metres by 50 metres), including the area around the adit.

The surface drilling was initiated with a diameter of HQ and the minimum diameters were BX and BQ.  The underground drilling was carried throughout with BX diameter.  The drilling system used included the traditional and wireline methods. Down hole
surveys were carried with the R-F DDI (reflex fotobor dip and direction pointer), Fotobor DDI and Maxbor units were used to prevent errors in azimuth readings due to the influence of natural magnetic properties within the rocks. Core recoveries of
80% in weathered rock and 90% in fresh rock were achieved by the drilling companies during the campaigns.

The majority of the core recovered is NQ size (47.1 millimetres) with a lesser amount of (Imperial) BQ size (31.5 millimetres).

Sampling and Analysis

Sample Preparation

Core is delivered by the drilling contractor to the core logging/storage area. After the core is photographed and logged, sample intervals are marked; the sample intervals average one metre in mineralized zones and two or four meters in barren
zones. Sample lengths may vary depending on geological and lithological/structural criteria (geologic boundaries, lithological/mineralogical changes, faults and shear zones, etc). The core is cut by a diamond saw and one half is submitted for sample
preparation and assaying while the other half is kept in the core storage facility for further reference.

Sample Analysis

Sample Receipt and Preparation

Upon receipt of samples, the preparation laboratory personnel referenced (scanned) the bar code label attached to the sample bag. The weight of sample was electronically recorded together with information such as date, time, equipment used and
operator name.  The scanning process allowed for complete traceability of the sample through the entire laboratory process.

Assay Methodology

The samples (a 5 gram aliquot) were routinely analyzed for copper, silver and iron by atomic absorption spectrometry (“AAS”). Gold was determined by a lead collection fire assay/AAS technique on a 30 gram sample. In the early stages of
the exploration program Pd, Pt, Ni, Mo, and U were also analyzed but later were excluded from the analytical package.

Sample Security

All drill core was brought from the drill site at the end of shift, and stored in a purpose built logging and storage facility.  Core undergoes a standard logging procedure before being sawn at the adjacent diamond saw building. Mineralized sample
boxes are returned to the storage facility where they are kept under lock and key. The core storage and logging facility is kept locked when unoccupied. Unshipped samples are also stored in a secure facility at the same location.

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Quality Assurance and Quality Control

The QAQC program implemented for Salobo is complex due the
implementation of different schemes of QA over a prolonged period of time.

SGS Lakefield Research Ltd. (Lakefield) was used for the
routine analysis of copper, gold and silver, while Acme analysed for Mo, U, F, S
and C. The Gamik laboratory was used as a secondary laboratory to check the
results obtained from the primary laboratory (Lakefield and/or Acme). Initially,
SMSA allowed the laboratory the responsibility on the insertion of standards,
blanks and duplicates samples. Consequently, in the absence of robust QAQC data,
and in an attempt to validate the results related to campaigns before 2002, a
total of 51,768 of the original 75,577 samples drilled prior to 2002 were
re-assayed to corroborate the original results. The re-analysis considered pulps
and coarse rejects materials when possible. However, they are not identified
separately as repeats or duplicate in order to evaluate precision and sample
preparation respectively. Based on the results obtained, Vale applied an
adjustment factor to original sample grades.

For the 2002 to 2003 samples, SMSA produced internal standards,
but they were only available at the end of drilling program. Because of this, a
special lot of 1,500 samples from the 2002 to 2003 drilling program were sent
for reanalysis. A total of 76 aliquots were inserted in blind form for both
standards B5B and B3E3C3 (Salobo CMR) of the project.

The QC protocol at Salobo operations includes the following
control samples:

- In-house standard reference materials inserted at about 2.5 percent
  frequency.
- Coarse preparation blanks inserted at approximately 2.5 percent frequency.
- Pulp duplicates carried out by the primary laboratory at about five
  percent frequency.
- External assay checks by the secondary laboratory on up to five percent of
  randomly selected original pulps analyzed previously by the primary
  laboratory.

Mineral Reserve and Mineral Resource
Estimates

See Technical Information Summary of Mineral Reserves and
Mineral Resources for the estimated Mineral Reserves and Mineral Resources
(gold only, 25% attributable) for the Salobo Mine as of December 31, 2013.

Mining Operations

The Mineral Reserve at the Salobo Mine is being extracted using
conventional open pit mining methods consisting of shovels, trucks and drills as
the major mining equipment. Pre-stripping of the site has been completed and
production is expected to ramp up to 12 million tonnes per year by 2014 and
eventually reach 24 million tonnes per year by 2016.

The mine plan was generated based on the Proven and Probable
Mineral Reserves contained in Vales 2013 resource model. Reserves are reported
above a copper equivalent cut-off grade of 0.249 percent.

The ultimate pit was subdivided into seven internal phases
targeting the highest grade, lowest cost areas of the ultimate pit first. The
Salobo mine life spans approximately 29 years ending in 2042. However, the
process plant will continue operations, milling stockpile material, for another
23 years until 2065.

Phasing of the open pit development and application of the
cut-off grade strategy allows higher grade ore (above 1.00 percent copper) to be
mined in the initial years of the operation. This is followed, from years 2025
to 2033, by the mining of progressively lower grade material averaging 0.48
percent copper. The copper grade improves again during the final phases of pit
development, then decreases as production ramps down towards the processing the
lower grade stockpile material.

During mining, the ore placed on the stockpiles is classified
according to the following grade categories:

- Medium grade
  ore:              
  0.60 to 0.85 percent copper equivalent
- Low grade
  ore:                     
  0.30 to 0.60 percent copper equivalent

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Recovery Methods

Mineral reserves at Salobo indicate total reserve grades of approximately 0.71 percent copper and 0.37 grams per tonne gold. Copper occurs primarily as the minerals chalcocite, bornite and chalcopyrite. Gold values are predominantly associated with
the copper sulphides. Average levels of magnetite and chlorite are five percent and ten percent respectively. Potential deleterious elements include fluorine at approximately 0.40 percent and uranium at approximately 16 parts per million.

The main lithologies for hosting the copper sulphide mineralisation are magnetite schists (XMT) and biotite schists (BDX).  In general, higher copper values are associated with the magnetite schists, containing greater than ten percent magnetite,
with values typically greater than 0.6 percent copper.  Biotite schists generally contain lower copper values, typically in the range of 0.2 percent-0.6 percent copper. Low grade ore is currently stockpiled.

Phase I of the Salobo plant is designed to process 12 million tonnes per year of ore to produce approximately 100,000 tonnes of copper in a copper-gold concentrate annually. Production commenced in June, 2012. Phase II of the Salobo plant expansion
involves doubling the throughput to 24 million tonnes per year with annualized copper in concentrate production rising to approximately 200,000 tonnes. Construction of Phase II is well advanced and is basically a mirror-image of Phase I, i.e.
essentially two identical production lines. Production from Phase II is scheduled to start in 2014.

Currently, Phase I is designed to operate 365 days per year, 24 hours per day and at 90 percent availability to process an average 1,522 tonnes per hour.

Overall, for the total reserve copper head grade of 0.71 percent copper, expected recovery was 84.2 percent, and for the total reserve gold head grade of 0.37 grams per tonne, expected recovery was 61.9 percent. Target copper grades in concentrate
are 35-42 percent copper with a typical value of 38 percent copper. Target gold grade in concentrate is 17 grams per tonne with an upper limit of 40 grams per tonne.

There are three deleterious elements of potential concern in the copper concentrate, namely fluorine, chlorine and uranium. Of these, fluorine is the most significant. In general, smelters will tend to reject concentrates with high fluorine content
due to problems in the smelter’s sulphuric acid plants. However, there are smelters that can accept high fluorine contents, although they are few in number. Vale has advised it has secured contracts with four smelters (in Poland, India, Sweden
and Germany) which are able to accept concentrates with an anticipated average fluorine content of 1,800 parts per million and a maximum content of 4,000 parts per million.

Apart from the inclusion of high pressure grinding rolls (“HPGR”) for tertiary crushing ahead of ball milling, the circuit is very conventional to the copper industry. The use of conventional semi-autogenous grinding (“SAG”)
milling is generally considered within Vale’s operating philosophy but the reasons for the design and selection of the HPGR/Ball Milling circuit are sound and were due mainly to the high magnetite (and copper) content of critical size pebbles
that would have been removed with the magnet protecting the pebble crusher and therefore requiring additional processing and the expected variability in ore hardness that would cause variability in SAG mill throughput in a typical SAG mill, ball
mill, pebble crusher circuit.

Run-of-mine ore at 2.5 metres top size is hauled in 240-tonne trucks and crushed in a 60 in x 89 in primary gyratory crusher to a product 80 percent passing 152 millimetres. The dump pocket volume capacity is equivalent to the volume of 2.5 trucks.
Primary crushed ore is conveyed to a crushed ore stockpile which has a live capacity of approximately 24,800 t and a total capacity of 73,400 tonnes. Coarse ore stockpile reclaim feeders are used to feed onto the primary screen feed conveyor which
feeds two operating double-deck vibrating screens. Screen oversize is crushed in two MP-1000 cone crushers (746 kilowatt motors) in a standard closed circuit. The nominal throughput for each crusher is 1,198 tonnes per hour.

Secondary crushed product is then conveyed to the secondary crushed ore stockpile feeding the HPGR units. This stockpile has a total capacity of approximately 171,000 tonnes and a live capacity of about 58,400 tonnes.

Four operating reclaim feeders are then used to reclaim the crushed ore and deliver it to the HPGR circuit via the stockpile reclaim conveyor and silo feed conveyor, equipped with a shuttle head. This delivers ore into one of two concrete
silos, providing approximately 20 minutes nominal capacity. A reversible feed belt conveyor and feed belt feeders then feed each of the two HPGR units.

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Each HPGR unit has a drum 2.0 metres diameter by 1.5 metres wide. The maximum feed size is 55 millimetres and the product is 80 percent passing 17 millimetres. The crushed HPGR product is discharged as a compressed cake and, via the product
collection conveyor, is then screened at eight millimetres aperture and broken up with high pressure water sprays. There are a total of four operating screens. The screen undersize, at 80 percent passing six millimetres, discharges directly into a
Ball Mill discharge sump.  The screen oversize is recirculated back via the screen oversize collection conveyor to the silo feed conveyor and further HPGR crushing.

Slurry in the Ball Mill discharge sump is pumped to hydrocyclones. Hydrocyclone underflow is fed by gravity to an overflow Ball Mill (7.9 metres diameter x 12.2 metres long) equipped with a 17 MW gearless motor. There are two Ball Mills operating in
closed circuit, each with a hydrocyclone cluster, i.e., two production lines. Ball Mill discharge feeds into the discharge sump for recirculation to the hydrocyclones. The design grind is 80 percent passing 105 microns. Hydrocyclone overflow
advances to the copper flotation circuit at approximately 42 percent solids by weight. The Ball Mills are designed to operate at a 30-35 percent ball charge using 76 millimetres diameter steel balls and with a recirculating load of approximately 300
percent.

The flotation circuit is of conventional design. Rougher 1 flotation is carried out in two lines (one for each Ball Mill) using two cells, one for each line. The cells are mechanically agitated Outotec cells of 200 cubic metre capacity. The rougher
1 concentrate advances to the cleaner circuit.  The rougher 1 flotation tailings advances to the rougher 2 (scavenger) circuit consisting of two lines, each line containing six mechanically agitated 200 cubic metrecells.

Rougher scavenger (rougher 2) tailings gravitate to the TSF. Rougher 2 (scavenger) concentrate advances to the regrind circuit.

Rougher 1 concentrate advances to the cleaner circuit which is divided into cleaner 1, 2 and 3 circuits. Cleaner 1 circuit consists of eight column cells, each six metre diameter x 14 metres height, arranged in two lines of four cells each. The
concentrate from the cleaner 1 circuit advances to the cleaner 2 circuit, consisting of four cells, in two lines of two cells each, each column 4.3 metre diameter x 14 metres height. Concentrate from the cleaner 2 circuit advances to the cleaner 3
circuit, consisting of two cells, in two lines of one cell each, each column 4.3 metre diameter x 14 metres height. Cleaner 3 tailings recirculates back to the feed of cleaner 2 and cleaner 2 tailings recirculates back to the feed of cleaner 1.

Cleaner 3 concentrate (final concentrate) advances to the concentrate dewatering circuit.

Cleaner 1 tailings advances to the cleaner-scavenger circuit which consists of ten 200 cubic metres mechanically agitated cells, arranged in two lines of five cells each.  Cleaner-scavenger tailings reports to the final tailings with the rougher
scavenger tailings.

Cleaner-scavenger concentrate is reground in the regrind circuit together with the rougher 2 (scavenger) concentrate.  The regrind circuit consists of four parallel tower mills fitted with 1,120 kilowatt motors and operated in closed circuit (one
cluster per mill) with hydrocyclones. The product of the regrinding process is nominally 80 percent passing 21 to 23 microns and advances to the cleaner 1 circuit.

The final concentrate dewatering circuit consists of a 15 metre diameter, high-capacity thickener, producing a pulp at 60 percent solids. The slurry is then transferred into a 1,360 cubic metre stock tank and cyclically pumped into two horizontal
frame pressure filters. The filtrate solution returns to the thickener and thickener overflow is pumped to the plant process water tank.

The filtered concentrate has a residual moisture content of about 9.5 percent. It is stockpiled below the filters in a covered concentrate storage area.

Concentrate is reclaimed by front-end loader and loaded into trucks. Each loader bucket (approximately seven tonnes) is sampled and a composite, representative sample for about 125 tonnes of concentrate is taken for assay. The copper concentrate is
weighed in the trucks using a static scale and delivered to a rail spur storage area, 85 kilometres away at the town of Parauapebas. The warehouse can hold 16 kilotonnes of concentrate which is reclaimed by front-end loader and loaded into railcars carrying it to the port of Itaqui, in
São Luís, about 870 kilometres from Parauapebas. Further sampling is carried out
here.

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Flotation reagents used include potassium amyl xanthate and
sodium dithiophosphate as primary and secondary collectors respectively,
poliglycolic alcohol and methyl isobutyl carbinol as frothers, quicklime for pH
modification and sodium sulphide for oxidized or easily oxidized copper
minerals, e.g. bornite.

The combined flotation circuit tailings (rougher and
cleanerscavenger tailings) flow by gravity from the plant to the tailings
deposition area, located directly north of the processing plant. Tailings are
dumped from a single-point discharge and create a beach on the south side of the
dam. Over the mine life, several phases of dam raising with mine waste will be
required to provide the required storage volume. Vertical pumps installed on
pontoons pump recycled tailings dam water back to the process plant, accounting
for approximately 95 percent of the total process water requirements.

Production Information

The following table summarizes 2013 gold production (100%
basis) from the Salobo Mine subsequent to the effective date of the Salobo
Report (December 31, 2012):

Units
    2013Tonnage
    (tonne)
    7,366,344Gold Grade
    (g/t)
    0.76Gold Recovery
    (%)
    65%Produced Gold
    (oz)
    116,590Payable Gold
    (oz)
    111,270


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DIVIDENDS

On March 3, 2011, the Company announced that its Board of Directors had approved an inaugural quarterly dividend of $0.03 per Common Share, which was paid for each of the first three quarters of 2011. A fourth quarterly dividend of $0.09 per
share was paid to the holders of record of the Common Shares as of the close of business on November 23, 2011. The total of dividends paid during 2011 was $0.18 per Common Share.

In November 2011, the Company announced that it had adopted a dividend policy that linked quarterly dividend payments to operating cash flows in the prior quarter, such that the quarterly dividend per Common Share was to be 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.

A quarterly dividend of $0.09 per share was paid to shareholders for each of the first two quarters of 2012. A third quarterly dividend of $0.10 per share was paid to the holders of record of the Common Shares as of the close of business on
August 30, 2012. A fourth quarterly dividend of $0.07 per share was paid to holders of record of the Common Shares as of the close of business on November 21, 2012. The total of dividends paid during 2012 was $0.35 per Common Share.

On May 10, 2013 the Company announced that it had amended its dividend policy so that the quarterly dividend per common share was to be equal to 20% of the average cash generated by operating activities in the previous four quarters divided by the
Company's outstanding common shares at the time the dividend is approved, all rounded to the nearest cent. The declaration, timing, amount and payment of dividends remains at the discretion of the Board of Directors and will depend on the
Company’s cash requirements, future prospects and other factors deemed relevant by the Board of Directors.

A quarterly dividend of $0.14 per share was paid to shareholders for the first quarter of 2013. In order to reflect the amendment to the Company’s dividend policy, and as a transitionary measure, the second quarterly dividend paid to
shareholders of $0.12 per share was calculated using the average cash generated by operating activities for the trailing two quarters (fourth quarter of 2012 and first quarter of 2013). A third quarterly dividend of $0.10 per share was paid
to holders of record of the Common Shares as of the close of business on August 30, 2013 and was calculated using the average cash generated by operating activities for the trailing three quarters (fourth quarter 2012, first quarter 2013 and second
quarter 2013). A fourth quarterly dividend of $0.09 per share was paid to holders of record of the Common Shares as of the close of business on November 27, 2013. The total of dividends paid during 2013 was $0.45 per Common Share.

Effective March 20, 2014, the Board has approved the adoption of a Dividend Reinvestment Plan. It is intended that the Dividend Reinvestment Plan will be effective commencing with the second dividend of 2014 which will be paid after the announcement
of the first quarter 2014 earnings results. The Dividend Reinvestment Plan remains subject to regulatory approval.

DESCRIPTION OF CAPITAL STRUCTURE

Authorized Capital

The authorized share capital of the Company consists of an unlimited number of Common Shares and an unlimited number of preference shares (the “Preference Shares”), issuable in series. As of March 26, 2014, 357,407,616 Common Shares and
no Preference Shares are issued and outstanding.

The Company had previously issued U.S. dollar common share purchase warrants (the “U.S. Dollar Warrants”), which were exercisable to acquire one Common Share at a price of $20.00 until September 5, 2013. As of September 5, 2013, the
warrants expired and are no longer exercisable. Prior to expiry, 2,685,719 U.S. Dollar Warrants were exercised for total proceeds of $53.7 million to the Company.

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The Company has issued common share purchase warrants to Vale (the “Vale Warrants”), which are exercisable to acquire one Common Share at a price of $65.00 until February 28, 2023. The exercise price and the number of Common Shares
issuable upon exercise are both subject to adjustment in certain circumstances. No fractional Common Shares will be issuable upon the exercise of any Vale Warrants, and no cash or other consideration will be paid in lieu of fractional shares.
Holders of Vale Warrants will not have any voting rights or any other rights which a holder of Common Shares would have. The Vale Warrants are authorized to be issued under a warrant indenture entered into between the Company and Canadian Stock
Transfer Company dated February 28, 2013. As of March 26, 2014, 10,000,000 Vale Warrants were issued and outstanding.

Common Shares

Holders of Common Shares are entitled to receive notice of any meetings of shareholders of the Company, to attend and to cast one vote per Common Share at all such meetings. Holders of Common Shares do not have cumulative voting rights with respect
to the election of directors and, accordingly, holders of a majority of the Common Shares entitled to vote in any election of directors may elect all directors standing for election. Holders of Common Shares are entitled to receive on a pro rata
basis such dividends, if any, as and when declared by the Company’s Board of Directors at its discretion from funds legally available therefor and upon the liquidation, dissolution or winding up of the Company are entitled to receive on a pro
rata basis the net assets of the Company after payment of debts and other liabilities, in each case subject to the rights, privileges, restrictions and conditions attaching to any other series or class of shares ranking senior in priority to or on a
pro rata basis with the holders of Common Shares with respect to dividends or liquidation. There are currently no other series or class of shares which rank senior in priority to the Common Shares. The Common Shares do not carry any pre-emptive,
subscription, redemption or conversion rights, nor do they contain any sinking or purchase fund provisions.

Preference Shares

The Preference Shares may, at any time or from time to time, be issued in one or more series. The Company’s Board of Directors shall fix before issue, the number of, the consideration per share of, the designation of, and the provisions
attaching to the shares of each series. Except as required by law or as otherwise determined by the Company’s Board of Directors in respect of a series of shares, the holder of a Preference Share shall not be entitled to vote at meetings of
shareholders. The Preference Shares of each series rank on a priority with the Preference Shares of every other series and are entitled to preference over the Common Shares and any other shares ranking subordinate to the Preference Shares with
respect to priority and payment of dividends and distribution of assets in the event of liquidation, dissolution or winding-up of the Company.

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TRADING PRICE AND VOLUME

Common Shares

The Common Shares are listed and posted for trading on the TSX
and the NYSE under the symbol SLW. The following table sets forth information
relating to the trading of the Common Shares on the TSX for the months
indicated.

|               | High  | Low   |           
|-------------- | ----- | ----- | ----------
|Month          | (C$)  | (C$)  | Volume    
|               |       |       |           
|January 2013   | 36.78 | 34.16 | 19,922,041
|February 2013  | 37.13 | 32.65 | 26,578,236
|March 2013     | 32.63 | 30.94 | 23,688,067
|April 2013     | 31.32 | 22.62 | 39,333,823
|May 2013       | 25.07 | 22.40 | 29,299,891
|June 2013      | 24.87 | 18.59 | 29,615,302
|July 2013      | 24.30 | 19.95 | 28,934,434
|August 2013    | 29.89 | 21.71 | 31,353,248
|September 2013 | 28.17 | 24.83 | 32,654,725
|October 2013   | 25.70 | 22.90 | 29,085,863
|November 2013  | 23.40 | 21.53 | 29,970,707
|December 2013  | 22.83 | 20.65 | 25,682,432

The price of the Common Shares as quoted by the TSX at the
close of business on December 31, 2013 was C$21.45 and on March 26, 2014 was
C$24.79.

U.S. Dollar Warrants

The U.S. Dollar Warrants were listed and posted for trading on
the TSX under the symbol SLW.WT.U. The following table sets forth information
relating to the trading of the U.S. Dollar Warrants on the TSX for the months
indicated.

|                   | High  | Low   |        
|------------------ | ----- | ----- | -------
|Month              | ($)   | ($)   | Volume 
|                   |       |       |        
|January 2013       | 17.25 | 13.52 | 155,218
|February 2013      | 17.26 | 11.60 | 108,873
|March 2013         | 12.04 | 10.15 | 83,363 
|April 2013         | 10.80 | 3.39  | 469,958
|May 2013           | 5.49  | 3.16  | 148,541
|June 2013          | 5.00  | 1.00  | 191,329
|July 2013          | 3.85  | 1.07  | 184,340
|August 2013        | 9.01  | 1.51  | 799,364
|September 2013 (1) | 7.20  | 5.65  | 198,235

|(1) | The U.S. Dollar Warrants expired September 5, 2013 and as
      a result, no trading was conducted after that date. The price of the U.S.
      Dollar Warrants as quoted by the TSX at the close of business on September
      5, 2013 (the last day of trading for the U.S. Dollar Warrants) was
      $5.65.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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DIRECTORS AND OFFICERS

The following table sets forth the name, province/state and
country of residence, position(s) held with the Company and principal occupation
of each person who is a director and/or an executive officer of the Company as
of the date of this annual information form.

|Name,                    |                                              |                                            
|------------------------ | -------------------------------------------- | -------------------------------------------
|Province/State and       |                                              |                                            
|Country of Residence     | Position(s) with the Company                 | Principal Occupation                       
|                         |                                              |                                            
|Douglas M. Holtby        | Chairman of the Board and
    Director since | Corporate Director                         
|British Columbia, Canada | April 2006 (4)                               |                                            
|                         |                                              |                                            
|Lawrence I. Bell (2)(3)  | Director since April 2006 (4)                | Corporate Director                         
|British Columbia, Canada |                                              |                                            
|                         |                                              |                                            
|George L. Brack (1)(2)   | Director since November 2009 (4)             | Corporate Director                         
|British Columbia, Canada |                                              |                                            
|                         |                                              |                                            
|John A. Brough (1)(3)    | Director since October 2004 (4)              | Corporate Director                         
|Ontario, Canada          |                                              |                                            
|                         |                                              |                                            
|                         |                                              |                                            
|R. Peter Gillin (1)(2)   | Director since October 2004 (4)              | Corporate Director                         
|Ontario, Canada          |                                              |                                            
|                         |                                              |                                            
|Chantal Gosselin         | Director since November 2013 (4)             | Corporate Director                         
|Ontario, Canada          |                                              |                                            
|                         |                                              |                                            
|Eduardo Luna (2)         | Director since December 2004 (4)             | Corporate Director                         
|Mexico City, Mexico      |                                              |                                            
|                         |                                              |                                            
|Wade D. Nesmith (1)(3)   | Director since October 2004 (4)              | Corporate Director                         
|British Columbia, Canada |                                              |                                            
|                         |                                              |                                            
|Randy V. J. Smallwood    | President, Chief Executive Officer and       | President and Chief Executive Officer of   
|British Columbia, Canada | Director                                     | Silver Wheaton                             
|                         | Director since May 2011 (4)                  |                                            
|                         |                                              |                                            
|Gary D. Brown            | Senior Vice President and Chief              | Senior Vice President and Chief            
|British Columbia, Canada | Financial
      Officer                      | Financial
      Officer of Silver Wheaton  
|                         |                                              |                                            
|Curt D. Bernardi         | Senior Vice President, Legal and             | Senior Vice President, Legal and           
|British Columbia, Canada | Corporate
      Secretary                    | Corporate
      Secretary of Silver Wheaton
|                         |                                              |                                            
|Haytham H. Hodaly        | Senior Vice President, Corporate             | Senior Vice President, Corporate           
|British Columbia, Canada | Development                                  | Development
      of Silver Wheaton        
|                         |                                              |                                            

|(1) | Member of the Audit Committee.                                                                                                                                                                                                                                                                                 
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Member of the Human Resources Committee.                                                                                                                                                                                                                                                                       
|(3) | Member of the Governance and Nominating
  Committee.                                                                                                                                                                                                                                                           
|(4) | Directors are elected at each annual meeting of Silver
      Wheatons shareholders and serve as such until the next annual meeting or
      until their successors are elected or appointed. Ms. Gosselin was
      appointed to the Board November 8, 2013 and did not serve on any
      committees in 2013.

The principal occupations, businesses or employments of each of
the Companys directors and executive officers within the past five years are
disclosed in the brief biographies set forth below.

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Douglas M. Holtby – Chairman of the Board and Director.Mr. Holtby is currently the Vice Chairman of the Board and Lead Director of Goldcorp, a director of BC Cancer Foundation and President and Chief Executive Officer of Holtby
Capital Corporation, a private investment company. From June 1989 to June 1996, Mr. Holtby was President, Chief Executive Officer and a director of WIC Western International Communications Ltd., from 1989 to 1996, he was Chairman of Canadian
Satellite Communications Inc., from 1998 to 1999, he was a Trustee of ROB.TV and CKVU, from 1974 to 1989, he was President of Allarcom Limited and, from 1982 to 1989, he was President of Allarcom Pay Television Limited. Mr. Holtby is a Fellow
Chartered Accountant, and a graduate of the Institute of Corporate Directors - Director Education Program at the University of Toronto, Rotman School of Management.

Lawrence I. Bell – Director.  Mr. Bell served as the non-executive Chairman of British Columbia Hydro and Power Authority until December 2007. From August 2001 to November 2003, Mr. Bell was Chairman and Chief Executive Officer
of British Columbia Hydro and Power Authority and, from 1987 to 1991, he was Chairman and Chief Executive Officer of British Columbia Hydro and Power Authority. He is also a director of Capstone and Matrix Asset Management Inc.
(“Matrix”) and is former Chairman of the University of British Columbia Board of Directors and former Chairman of Canada Line (Rapid Transit) Project and a former director of Goldcorp from 2005 to May 2013. Mr. Bell will be resigning as
a director of Matrix effective April 1, 2014. Prior to these positions, Mr. Bell was Chairman and President of the Westar Group and Chief Executive Officer of Vancouver City Savings Credit Union. In the province’s public sector, Mr. Bell has
served as Deputy Minister of Finance and Secretary to the Treasury Board. He holds a Bachelor of Arts degree and an Honorary Ph.D. from the University of British Columbia. He also holds a Masters of Arts degree from San José State University,
is a Fellow of the Institute of Corporate Directors and holds the Order of British Columbia.

George L. Brack – Director.Mr. Brack is the Chairman of Capstone, Alexco and Geologix Explorations Inc. and serves as a director of Newstrike Capital Inc. Mr. Brack’s 28-year career in the mining industry has focused on
investment banking and corporate development, specifically identifying, evaluating and executing strategic mergers and acquisitions, and the provision of equity financing. Until January 2009, Mr. Brack acted as the Managing Director and Industry
Head, Mining Group, of Scotia Capital.  Prior to joining Scotia Capital in 2006, Mr. Brack spent seven years as President of Macquarie North America Ltd., an investment banking firm specializing in merger and acquisition advice. Previous to that,
Mr. Brack was Vice President, Corporate Development at Placer Dome Inc., was Vice President of the investment banking group at CIBC Wood Gundy, and worked in Rio Algom’s Corporate Development department. Mr. Brack holds an MBA from York
University, a BASc in Geological Engineering from the University of Toronto and the CFA designation.

John A. Brough – Director.  Mr. Brough had been President of both Torwest, Inc. and Wittington Properties Limited, real estate development companies, from 1998 to December 31, 2007, upon his retirement. Prior thereto, from 1996
to 1998, Mr. Brough was Executive Vice President and Chief Financial Officer of iSTAR Internet, Inc. Prior thereto, from 1974 to 1996, he held a number of positions with Markborough Properties, Inc., his final position being Senior Vice President
and Chief Financial Officer which position he held from 1986 to 1996. Mr. Brough is an executive with over 40 years of experience in the real estate industry. He is currently a director and Chairman of the Audit and Risk Committee of Kinross Gold
Corporation, a director and Chairman of the Audit Committee and Lead Director of First National Financial Corporation, and a director and Chairman of the Audit Committee of Canadian Real Estate Investment Trust. He holds a Bachelor of Arts degree
(Economics) from the University of Toronto and is a Chartered Professional Accountant and a Chartered Accountant. He is also a graduate of the Institute of Corporate Directors – Director Education Program at the University of Toronto, Rotman
School of Management. Mr. Brough is a member of the Institute of Corporate Directors and the Ontario and Canadian Institutes of Chartered Accountants.

R. Peter Gillin – Director.  Mr. Gillin was Chairman and Chief Executive Officer of Tahera Diamond Corporation, a diamond exploration, development and production company, from October 2003 to September 2008 and Chief
Restructuring Officer until December 2008. Since 2004, Mr. Gillin has been a member of the Independent Review Committee of TD Asset Management Inc. and, from December 2005 to September 2012, a director of Trillium Health Care Products Inc. (a
private company). Mr. Gillin was appointed a director of Sherritt International Corporation January 1, 2010 and Dundee Precious Metals Inc. in December 2009. From April 2008 to March 2009, Mr. Gillin was a director of HudBay Minerals Inc. From
November 2002 to May 2003, Mr. Gillin was President and Chief Executive Officer of Zemex Corporation, an industrial minerals producer, and had been a director of that company since 1999. From 1996 to 2002, Mr. Gillin was Vice Chairman and a director
of N.M. Rothschild & Sons Canada Limited, an investment bank, and, from 2001 to 2002, was Acting Chief Executive Officer. He holds a HBA degree from the Richard Ivey School of Business at the University of Western Ontario and is a Chartered
Financial Analyst. He is also a graduate of the Institute of Corporate Directors – Director Education Program at the University of Toronto, Rotman School of Management and has earned the designation of ICD.D. from the Institute of Corporate
Directors.

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Chantal Gosselin – Director.Ms. Gosselin brings over 20 years of experience in the financial services and mining industry. Most recently, Ms. Gosselin served as Vice President and Portfolio Manager at Goodman Investment
Counsel. Prior to this, she was a senior mining analyst at Sun Valley Gold LLP, a precious metals focused investment hedge fund. Ms. Gosselin was formerly a senior mining analyst and partner of Genuity Capital Markets. Prior to joining Genuity
Capital Markets, she held positions as a mining analyst with Haywood Securities Inc. and Dundee Securities Corporation. Prior to entering the financial industry, Ms. Gosselin held a variety of management positions in the mining industry at Dynatec
Mining Corporation, Aur Resources Inc. and Pan American Silver Corp. Ms. Gosselin holds a Bachelor of Science in Mine Engineering from Laval University, an MBA in business administration from Concordia University and a Chartered Investment Manager
Designation.

Eduardo Luna – Director.  Mr. Luna is currently Director, President and CEO of Rochester Resources Ltd., Advisor and Director of Primero and advisor of Mercator Minerals Ltd. Mr. Luna was Chairman of the Company from October 2004
to May 2009 (and was Interim Chief Executive Officer of the Company from October 2004 to April 2006), Executive Vice President of Wheaton River from June 2002 to April 2005, Executive Vice President of Goldcorp from March 2005 to September 2007 and
President of Luismin, S.A. de C.V. from 1991 to 2007. He holds a degree in Advanced Management from Harvard University, an MBA from Instituto Tecnologico de Estudios Superiores de Monterrey and a Bachelor of Science in Mining Engineering from
Universidad de Guanajuato. He held various executive positions with Minera Autlan for seven years and with Industrias Peñoles for five years.  He is the former President of the Mexican Mining Chamber and the former President of the Silver
Institute. He serves as Chairman of the Advisory Board of the Faculty of Mines at the University of Guanajuato and as a board member of the Mineral Resources Council in Mexico.

Wade D. Nesmith – Director. Mr. Nesmith is currently Chairman of Primero Mining Corp. and from 2004 to 2009 was associate counsel with Lang Michener LLP (now McMillan LLP), a law firm where he previously practiced as a partner
from 1993 to 1998. Mr. Nesmith has served on the boards of, among others, Polymer Group, Inc., Broadpoint Securites, Inc., and Westport Innovations, where he was also a senior officer of the Company.  He also served as the Executive Director (then
Superintendent of Brokers) for the British Columbia Securities Commission.  Mr. Nesmith received his LLB from Osgoode Hall Law School in 1977.

Randy V. J. Smallwood – President, Chief Executive Officer and Director.Mr. Smallwood holds a geological engineering degree from the University of British Columbia, and is one of the founding members of Silver Wheaton. In 2007,
he joined Silver Wheaton full time as Executive Vice President of Corporate Development, primarily focusing on growing the Company through the evaluation and acquisition of silver stream opportunities. In January 2010 he was appointed President, and
in April 2011 he was appointed Silver Wheaton’s Chief Executive Officer. Mr. Smallwood originally started as an exploration geologist with Wheaton River Minerals Ltd., and in 2001 was promoted to Director of Project Development, his role
through its 2005 merger with Goldcorp. Before joining the original Wheaton River group in 1993, Mr. Smallwood also worked with Homestake Mining Company, Teck Corp. and Westmin Resources.  Mr. Smallwood was an instrumental part of the team that built
Wheaton River / Goldcorp into one of the largest, and more importantly most profitable gold companies in the world, and he is now focused on continuing to add to the impressive growth profile of Silver Wheaton.

Gary D. Brown – Senior Vice President and Chief Financial Officer.Mr. Brown is currently the Senior Vice President and Chief Financial Officer of Silver Wheaton having joined the Company in June 2008.  Prior to Silver Wheaton,
he was the Chief Financial Officer of TIR Systems Ltd. from September 2005 to July 2007. He has also held senior finance roles with CAE Inc., Westcoast Energy Inc., and Creo Inc. Mr. Brown brings almost 22 years of experience as a finance
professional and holds professional designations as a Chartered Accountant and a Chartered Financial Analyst as well as having earned a Masters Degree in Accounting from the University of Waterloo. Mr. Brown has also been a director of Redzone
Resources Ltd. since 2012.

Curt D. Bernardi – Senior Vice President, Legal and Corporate Secretary.Mr. Bernardi joined the Company in 2008 and has been practicing law since his call to the British Columbia bar in 1994. He worked for the law firm of Blake,
Cassels & Graydon in the areas of corporate finance, mergers and acquisitions and general corporate law until leaving to join Westcoast Energy in 1998. Following the acquisition of Westcoast Energy by Duke Energy in 2002, Mr. Bernardi continued
to work for Duke Energy Gas Transmission as in-house legal counsel, working primarily on reorganizations, mergers and acquisitions, joint ventures and general corporate/commercial work. In 2005, Mr. Bernardi joined Union Gas as their Director, Legal
Affairs and was responsible for legal matters affecting Union Gas. He obtained his Bachelor of Commerce from the University of British Columbia and his Bachelor of Law from the University of Toronto.

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Haytham H. Hodaly– Senior Vice President, Corporate Development.Mr. Hodaly joined Silver Wheaton in 2012, bringing with him over 16 years of experience in the North American securities industry, most recently as Director and
Mining Analyst, Global Mining Research, at RBC Capital Markets. In this role, he was responsible for providing, to a wide range of institutional clients around the globe, up-to-date and insightful research coverage of North American-listed precious
metals companies. Prior to this, Mr. Hodaly held the position of Co-Director of Research and Senior Mining Analyst at Salman Partners Inc., in addition to holding the titles of Vice President and Director of the firm. During his tenure, he helped to
establish Salman Partners Inc. as a leading independent, resource-focused and research-driven investment dealer. Mr. Hodaly is an engineer with a B.A.Sc. in Mining and Mineral Processing Engineering and a Masters of Engineering, specializing in
Mineral Economics.

As at December 31, 2013, the directors and executive officers of Silver Wheaton, as a group, beneficially owned, directly and indirectly, or exercised control or direction over 605,521 Common Shares, representing less than one percent of the total
number of Common Shares outstanding before giving effect to the exercise of options or warrants to purchase Common Shares held by such directors and executive officers.  The statement as to the number of Common Shares beneficially owned, directly or
indirectly, or over which control or direction is exercised by the directors and executive officers of Silver Wheaton as a group is based upon information furnished by the directors and executive officers.

Cease Trade Orders, Bankruptcies, Penalties or Sanctions

To the knowledge of the Company, no director or executive officer of the Company is, or within ten years prior to the date hereof has been, a director, chief executive officer or chief financial officer of any company (including the Company) that:
(i) was subject to a cease trade order, an order similar to a cease trade order or an order that denied the relevant company access to any exemption under securities legislation, that was in effect for a period of more than 30 consecutive days, that
was issued while the director or executive officer was acting in the capacity as director, chief executive officer or chief financial officer; or (ii) was subject to a cease trade order, an order similar to a cease trade order or an order that
denied the relevant company access to any exemption under securities legislation, that was in effect for a period of more than 30 consecutive days, that was issued after the director or executive officer ceased to be a director, chief executive
officer or chief financial officer and which resulted from an event that occurred while that person was acting in the capacity as director, chief executive officer or chief financial officer, other than: (a) Mr. Brough who is a director of a mining
company that was subject to a management cease trade order against the directors and officers of the mining company from April 2005 to February 2006 in connection with such company’s failure to file audited financial statements for the year
ended December 31, 2004. The missed filings resulted from questions raised by the United States Securities and Exchange Commission (the “SEC”) about certain accounting practices related to the accounting for goodwill. When the SEC
accepted the mining company’s proposed treatment, the mining company made its filings, and the cease trade orders were revoked; and (b) Mr. Gillin who was a director of, and Chairman and Chief Executive Officer of Tahera Diamond Corporation
(“Tahera”) from October 2003 to December 2008, a company that filed for protection under the Companies’ Creditors Arrangement Act (Canada) (“CCAA”) with the Ontario Superior Court of Justice on January 16, 2008.
As a consequence of its financial difficulties, Tahera failed to file financial statements for the year ended December 31, 2007 and subsequent financial periods. As a result, Tahera was delisted from the TSX in November 2009 and issuer cease trade
orders were issued in 2010 by the securities regulatory authorities of Ontario, Quebec, Alberta and British Columbia, which orders have not been revoked. Tahera subsequently sold its tax assets to Ag Growth International and certain properties,
including the Jericho diamond mine, to Shear Minerals Ltd., and the monitoring process under CCAA concluded by order of the Superior Court of Justice in September, 2010.

To the knowledge of the Company, no director or executive officer of the Company, or a shareholder holding a sufficient number of securities of the Company to affect materially control of the Company, is, or within ten years prior to the date hereof
has been, a director or executive officer of any company (including the Company) that, while that person was acting in that capacity, or within a year of that person ceasing to act in that capacity, became bankrupt, made a proposal under any
legislation relating to bankruptcy or insolvency or was subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold its assets, other than: (a) Mr. Nesmith who
was a director of an automotive company which applied for Chapter 11 bankruptcy protection in December 2004 and emerged from Chapter 11 bankruptcy protection in March 2005; and (b) Mr. Gillin who was a director of, and Chairman and Chief Executive
Officer of Tahera from October 2003 to December 2008, a company that filed for protection under the CCAA with the Ontario Superior Court of Justice on January 16, 2008. Tahera subsequently sold its tax assets to Ag Growth International and certain
properties, including the Jericho diamond mine, to Shear Minerals Ltd., and the monitoring process under CCAA concluded by order of the Superior Court of Justice in September, 2010.

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To the knowledge of the Company, no director or executive officer of the Company, or a shareholder holding a sufficient number of securities of the Company to affect materially control of the Company, has, within ten years prior to the date hereof,
become bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency, or become subject to or instituted any proceedings, arrangement or compromise with creditors, or had a receiver, receiver manager or trustee appointed to
hold the assets of the director, executive officer or shareholder.

To the knowledge of the Company, no director or executive officer of the Company, or a shareholder holding a sufficient number of securities of the Company to affect materially the control of the Company, has been subject to: (i) any penalties or
sanctions imposed by a court relating to securities legislation or by a securities regulatory authority or has entered into a settlement agreement with a securities regulatory authority; or (ii) any other penalties or sanctions imposed by a court or
regulatory body that would likely be considered important to a reasonable investor in making an investment decision.

Conflicts of Interest

To the best of Silver Wheaton’s knowledge, and other than as disclosed in this annual information form, there are no known existing or potential material conflicts of interest between Silver Wheaton and any director or officer of Silver
Wheaton, except that certain of the directors and officers serve as directors and officers of other public companies and therefore it is possible that a conflict may arise between their duties as a director or officer of Silver Wheaton and their
duties as a director or officer of such other companies. Certain of the directors and officers of the Company also serve as directors and/or officers of other companies involved in natural resource exploration, development and mining operations and
consequently there exists the possibility for such directors and officers to be in a position of conflict. Any decision made by any of such directors and officers will be made in accordance with their duties and obligations to deal fairly and in
good faith with a view to the best interests of the Company and its shareholders.  In addition, each of the directors is required to declare and refrain from attending the portion of the meeting dedicated to discussing any matter in which such
directors may have a conflict of interest or voting on such matter in accordance with the procedures set forth in the Business Corporations Act(Ontario) and other applicable laws. See “Interest of Management and Others in Material
Transactions”.

INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS

Other than as described below and elsewhere in this annual information form, since January 1, 2011, no director, executive officer or 10% shareholder of the Company or any associate or affiliate of any such person or company, has or had any material
interest, direct or indirect, in any transaction that has materially affected or will materially affect the Company or any of its subsidiaries, except as follows:

| | (1) | Mr. Holtby is a director of Goldcorp, which is the owner of the Peñasquito Mine and the Los Filos Mine, and was the owner of the San Dimas Mines until August 6, 2010, and until May 2013, Mr. Bell was also a director of
Goldcorp;
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                     
| | (2) | Mr. Nesmith is a director of Primero and holds a significant equity position in Primero, which is the owner of the San Dimas Mines, and until March 15, 2012, Mr. Nesmith is the Chairman of the Board of Directors of Primero; and 
| |     |                                                                                                                                                                                                                                     
| | (3) | Mr. Luna is a director of Primero and holds a significant equity position in Primero, which is the owner of the San Dimas Mines, and until November 30, 2011, Mr. Luna was the Executive Vice President and President, Mexico.      

TRANSFER AGENT AND REGISTRAR

The transfer agent and registrar for the Common Shares is CST Trust Company (“CST”) at its principal offices in Vancouver, British Columbia and Toronto, Ontario.

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MATERIAL CONTRACTS

The only material contracts entered into by the Company as of
the date of this annual information form or before such time that are still in
effect, other than in the ordinary course of business, are as follows:

|1. | The $1 billion revolving credit facility dated as of
      February 28, 2013, between the Company and the lenders and the $1.0
      billion non-revolving term loan dated as of May 28, 2013 between the
      Company and the lenders.
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Each of such contracts is available on SEDAR at
www.sedar.com under the Companys profile.

INTERESTS OF EXPERTS

The scientific and technical information for the Companys
mineral projects on a property material to the Company contained in this annual
information form, other than for the Salobo Mine, was sourced by the Company
from the following SEDAR (www.sedar.com) filed documents:

| | a. | Peñasquito Mine  Goldcorp annual information form filed
      on March 31, 2014;   
| | -- | ------------------------------------------------------------------------------------
| | b. | San Dimas Mines  Primero annual information form filed
      on March 31, 2014; and
| | c. | Pascua-Lama Project  Barrick annual information form
      filed on March 31, 2014.

A summary of the information sourced from the annual
information forms of Primero, Goldcorp and Barrick is contained in this annual
information form under Technical Information  Further Disclosure Regarding
Mineral Projects on Material Properties San Dimas Mines, Mexico,  Peñasquito
Mine, Mexico,  Pascua-Lama Project, Border of Chile and Argentina,
respectively. Neil Burns, M.Sc., P.Geo., Vice President, Technical Services and
Samuel Mah, M.A.Sc., P.Eng., Senior Director, Project Evaluations, are the
qualified persons as defined by NI 43-101 in connection with the Mineral Reserve
and Mineral Resource estimates and the scientific and technical information for
the San Dimas Mines, the Peñasquito Mine and the Pascua-Lama Project contained
in this annual information form.

Christopher Jacobs, CEng MIMMM, Vice President and Mining
Economist, Micon International Ltd., James Turner, BSc (Hons) MSc CEng MIMMM,
Senior Mineral Process Engineer, Micon International Ltd., Barnard Foo, P. Eng.,
M. Eng., MBA, Senior Mining Engineer, Micon International Ltd. and Jason Ché
Osmond, FGS, C.Geol, EurGeol, Senior Geologist, Micon International Ltd.
prepared a technical report in accordance with NI 43-101 entitled Technical
Report on the Mineral Reserves and Mineral Resources of the Salobo Copper-Gold
Mine Carajás, Pará State, Brazil dated March 19, 2013 and have reviewed the
disclosure concerning the Salobo Mine contained in this annual information form.
A copy of the Salobo Report is available under the Companys profile on SEDAR at
www.sedar.com and a summary of the Salobo Report is contained in this annual
information form under the heading Description of the Business  Salobo Mine,
Brazil.

The aforementioned firms or persons held no securities of the
Company or of any associate or affiliate of the Company when they prepared the
reports, the mineral reserve estimates or the mineral resource estimates
referred to above, or following the preparation of such reports or estimates and
did not receive any direct or indirect interest in any securities of the Company
or of any associate or affiliate of the Company in connection with the
preparation of such reports or estimates, other than Neil Burns and Samuel Mah,
who together hold less than 1% of the Common Shares. None of the aforementioned
persons are currently expected to be elected, appointed or employed as a
director, officer or employee of the Company or of any associate or affiliate of
the Company, other than Neil Burns and Samuel Mah who are employees of the
Company.

Deloitte LLP is the auditor of the Company and is independent
of the Company within the meaning of the Rules of Professional Conduct of the
Institute of Chartered Accountants of British Columbia.

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AUDIT COMMITTEE

The Company’s Audit Committee is responsible for monitoring the Company’s systems and procedures for financial reporting and internal control, reviewing certain public disclosure documents and monitoring the performance and independence
of the Company’s external auditors. The committee is also responsible for reviewing the Company’s annual audited financial statements, unaudited quarterly financial statements and management’s discussion and analysis of financial
results of operations for both annual and interim financial statements and review of related operations prior to their approval by the full Board of Directors of the Company.  The committee also has oversight responsibility for significant business,
political, financial and control risks that the Company is exposed to, including a review of management’s assessment of the likelihood and severity of those risks and any mitigation steps taken.

The Audit Committee’s charter sets out its responsibilities and duties, qualifications for membership, procedures for committee member removal and appointment and reporting to the Company’s Board of Directors. A copy of the charter is
attached hereto as Schedule “A”.

The current members of the Company’s Audit Committee are John A. Brough (Chairman), George L. Brack, R. Peter Gillin and Wade D. Nesmith. Each of Messrs. Brough, Brack, Gillin and Nesmith are independent and financially literate within the
meaning of National Instrument 52-110 Audit Committees (“NI 52-110”).  In addition to being independent directors as described above, all members of the Company’s Audit Committee must meet an additional
“independence” test under NI 52-110 in that their directors’ fees are the only compensation they, or their firms, receive from the Company and that they are not affiliated with the Company.

The Audit Committee met four times in 2013. Each of Messrs. Brough, Gillin, Brack and Nesmith were present at all four meetings.

Relevant Education and Experience

See “Directors and Officers” for a description of the education and experience of each Audit Committee member that is relevant to the performance of his responsibilities as an Audit Committee member.

Pre-Approval Policies and Procedures

The Audit Committee’s charter sets out responsibilities regarding the provision of non-audit services by the Company’s external auditors. This policy encourages consideration of whether the provision of services other than audit services
is compatible with maintaining the auditor’s independence and requires Audit Committee pre-approval of permitted audit and audit-related services.

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External Auditor Service Fees

Deloitte LLP, Independent Registered Public Accounting Firm,
were the auditors of the Company in 2013. Fees billed by Deloitte LLP in respect
of services in 2012 and 2013 are detailed below:

**2012 (1)**
      **($)**
    **2013 (1)**
      **($)**Audit Fees
      (2)
    512,491
    587,008Audit-Related Fees
      (3)
    5,298
    121,225Tax Fees
      (4)
    141,233
    77,096All Other Fees
      (5)
    86,007
    30,754TOTAL
    745,029
    816,083


|(1) | Fees are paid in Canadian dollars and converted to United
      States dollars for reporting purposes in this table at the exchange rate
      of C$1.00 = US$0.9402 for the financial year ended December 31, 2013 and
      at the exchange rate of C$1.00 = US$1.0051 for the financial year ended
      December 31, 2012.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Audit fees were paid for professional services rendered
      by the auditors for the audit of the Companys annual financial statements
      or services provided in connection with statutory and regulatory filings
      or engagements.                                                                                 
|(3) | Audit-related fees were paid for translation services
      rendered by the auditors in connection with the audit of the Companys
      annual financial statements.                                                                                                                                                         
|(4) | Tax fees were paid for tax compliance and advisory
      services.                                                                                                                                                                                                                                                            
|(5) | Other Fees were paid for Canadian Public Accountability
      Board fees, preparation of tax returns for VAT tax and the Barbados
      subsidiary and accounting advisory services.                                                                                                                                          

ADDITIONAL INFORMATION

Additional information relating to the Company can be found on
SEDAR at www.sedar.com and on EDGAR at www.sec.gov. Additional information,
including directors and officers remuneration and indebtedness, principal
holders of the Companys securities and securities authorized for issuance under
equity compensation plans will be contained in the management information
circular of the Company to be prepared in connection with the Companys annual
meeting of shareholders scheduled to be held on May 9, 2014 which will be
available on SEDAR at www.sedar.com and EDGAR at www.sec.gov. Additional
financial information is provided in the Companys audited consolidated
financial statements and managements discussion and analysis for the year ended
December 31, 2013.

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|SCHEDULE A           
|-----------------------
|SILVER WHEATON CORP.   
|AUDIT COMMITTEE CHARTER

|I. | PURPOSE                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | The Audit Committee is a committee of the Board of
      Directors (the Board) of Silver Wheaton Corp. (Silver Wheaton or the
      Company). The primary function of the Audit Committee is to assist the
      Board in fulfilling its financial reporting and controls responsibilities
      to the shareholders of the Company and the investment community. The
      external auditors will report directly to the Audit Committee. The Audit
      Committees primary duties and responsibilities
are:

| | A. | overseeing the integrity of the Companys financial
      statements and reviewing the financial reports and other financial
      information provided by the Company to any governmental body or the public
      and other relevant documents;                                                                                                                                                                                   
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | B. | assisting the Board in oversight of the Companys
      compliance with legal and regulatory requirements;                                                                                                                                                                                                                                                                                                                          
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | C. | recommending the appointment and reviewing and appraising
      the audit efforts of the Companys independent auditor, overseeing the
      non-audit services provided by the independent auditor, overseeing the
      independent auditors qualifications and independence and providing an
      open avenue of communication among the independent auditor, financial and
      senior management and the Board of Directors;
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | D. | assisting the Board in oversight of the performance of
      the Companys internal audit function;                                                                                                                                                                                                                                                                                                                                 
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | E. | serving as an independent and objective party to oversee
      and monitor the Companys financial reporting process and internal
      controls, the Companys processes to manage business and financial risk,
      and its compliance with legal, tax, ethical and regulatory
      requirements;                                                                                                                               
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | F. | preparing Audit Committee report(s) as required by
      applicable regulators; and                                                                                                                                                                                                                                                                                                                                                 
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | G. | encouraging continuous improvement of, and fostering
      adherence to, the Companys policies, procedures and practices at all
      levels.                                                                                                                                                                                                                                                                                      

|II. | COMPOSITION AND
MEETINGS
|--- | ------------------------

| | A. | The Committee shall operate under the guidelines
      applicable to all Board committees, which are located in Tab A-6, Board
      Guidelines.                                                                                                                                                                                                                                   
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                    
| | B. | The Audit Committee shall be comprised of at least three
      directors, all of whom are independent as such term is defined in the
      Board Guidelines (Tab A-8, Appendix), and will satisfy such other
      applicable criteria for independence as may be contained in the laws,
      rules, regulations and listing requirements to which the Company is
      subject.

---

| | C. | In addition, unless otherwise authorized by the Board, no
      director shall be qualified to be a member of the Audit Committee if such
      director (i) is an affiliated person, as defined in Appendix I, or (ii)
      receives (or his/her immediate family member or the entity for which such
      director is a director, member, partner or principal and which provides
      consulting, legal, investment banking, financial or other similar services
      to the Company), directly or indirectly, any consulting, advisory, or
      other compensation from the Company other than compensation for serving in
      his or her capacity as member of the Board and as a member of Board
      committees.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | D. | All members shall, to the satisfaction of the Board of
      Directors, be financially literate as defined in Appendix I, and at
      least one member shall have accounting or related financial management
      expertise to qualify as a financial expert as defined in Appendix I, and
      will satisfy such other applicable criteria for financial expertise as may
      be contained in the laws, rules, regulations and listing requirements to
      which the Company is subject.                                                                                                                                                                                                                             
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | E. | If a Committee member simultaneously serves on the audit
      committees of more than three public companies, the Committee shall seek
      the Boards determination as to whether such simultaneous service would
      impair the ability of such member to effectively serve on the Companys
      audit committee and ensure that such determination is disclosed.                                                                                                                                                                                                                                                                                                                                                       
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | F. | The Committee shall meet at least four times annually, or
      more frequently as circumstances require. The Committee shall meet within
      45 days following the end of each of the first three financial quarters to
      review and discuss the unaudited financial results for the preceding
      quarter and the related MD&A and shall meet within 90 days following
      the end of the fiscal year end to review and discuss the audited financial
      results for the year and related MD&A prior to their
  publishing.                                                                                                                                                                                       
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | G. | The Committee may ask members of management or others to
      attend meetings and provide pertinent information as necessary. For
      purposes of performing their audit related duties, members of the
      Committee shall have full access to all corporate information and shall be
      permitted to discuss such information and any other matters relating to
      the financial position of the Company with senior employees, officers and
      independent auditor of the Company.                                                                                                                                                                                                                              
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | H. | As part of its job to foster open communication, the
      Committee should meet at least quarterly with management and the
      independent auditor in in-camera sessions, and as determined in the
      discretion of the Committee with the head of internal audit, to discuss
      any matters that the Committee or each of these groups believe should be
      discussed privately. In addition, the Committee or at least its Chair
      should meet with the independent auditor and management quarterly to
      review the Companys financial statements.                                                                                                                                                       
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | I. | Each of the Chairman of the Committee, members of the
      Committee, Chairman of the Board, independent auditors, Chief Executive
      Officer, Chief Financial Officer or Secretary shall be entitled to request
      that the Chairman of the Audit Committee call a meeting which shall be
      held within 48 hours of receipt of such
request.                                                                                                                                                                                                                                                                                                                                                                         

|III. | RESPONSIBILITIES AND DUTIES                                                
|---- | ---------------------------------------------------------------------------
|     |                                                                            
|     | To fulfill its responsibilities and duties the Audit
      Committee shall:

| | A. | Create an agenda for the ensuing
year.
| | -- | --------------------------------------

---

| | B. | Review and update this Charter at least annually, as
      conditions dictate.                                                                                                                           
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                          
| | C. | Describe briefly in the Companys Management Information
      Circular and/or the Companys Annual Information Form the Committees
      composition and responsibilities and how they were discharged.
| |    |                                                                                                                                                                                                          
| | D. | Documents/Reports
Review                                                                                                                                                                                 

| | i)   | Review with management and the independent auditor, the
      Companys interim and annual financial statements, management discussion
      and analysis, earnings releases and any other financial information to be
      publicly disclosed including any certification, report, opinion, or review
      rendered by the independent auditor for the purpose of recommending their
      approval to the Board prior to their filing, issue or publication. The
      Chair of the Committee may represent the entire Committee for purposes of
      this review in circumstances where time does not allow the full Committee
      to be available.
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | ii)  | Review analyses prepared by management and/or the
      independent auditor setting forth significant financial reporting issues
      and judgments made in connection with the preparation of the financial
      statements, including analyses of the effects of alternative accounting
      principles methods on the financial statements.                                                                                                                                                                                                                                                                                                          
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | iii) | Review the effect of regulatory and accounting
      initiatives, as well as off balance sheet structures, on the financial
      statements of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | iv)  | Review policies and procedures with respect to directors
      and officers expense accounts and management perquisites and benefits,
      including their use of corporate assets and expenditures related to
      executive travel and entertainment, and review the results of the
      procedures performed in these areas by the independent auditor, based on
      terms of reference agreed upon by the independent auditor and the Audit
      Committee.                                                                                                                                                                                    
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | v)   | Review expenses of the Board Chair and CEO
    annually.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | vi)  | Ensure that adequate procedures are in place for the
      review of the Companys public disclosure of financial information
      extracted or derived from the issuers financial statements, as well as
      review any financial information and earnings guidance provided to
      analysts and rating agencies, and periodically assess the adequacy of
      those procedures.                                                                                                                                                                                                                                                                   

| | E. | Independent Auditor
| | -- | -------------------

| | i)   | Recommend to the Board and approve the selection of the
      independent auditor, consider the independence and effectiveness and
      approve the fees and other compensation to be paid to the independent
      auditor.                                                      
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |      |                                                                                                                                                                                                                                                                                    
| | ii)  | Review and approve the independent auditors audit plan
      and engagement letter and discuss and approve the audit scope and
      approach, staffing, locations, reliance upon management and internal audit
      and general audit approach.                                 
| |      |                                                                                                                                                                                                                                                                                    
| | iii) | Monitor the relationship between management and the
      independent auditor including reviewing any management letters or other
      reports of the independent auditor and discussing any material differences of
      opinion between management and the independent auditor.

---

| | iv) | Review and discuss, on an annual basis, with the
      independent auditor all significant relationships they have with the
      Company to determine their independence and report to the Board of
      Directors.                                                                                                            
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                  
| | v)  | Review and approve requests for any non-audit services to
      be performed by the independent auditor and be advised of any other study
      undertaken at the request of management that is beyond the scope of the
      audit engagement letter and related fees. Pre-approval of non-audit
      services is satisfied if:

| | a) | The aggregate amount of non-audit services not
      pre-approved expected to constitute no more than 5% of total fees paid by
      issuer and subsidiaries to external auditor during fiscal year in which
      the services are provided;
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                              
| | b) | the Company or a subsidiary did not recognize services as
      non-audit at the time of the engagement; and                                                                                                                                 
| |    |                                                                                                                                                                                                                                              
| | c) | the services are promptly brought to Committees
      attention and approved prior to completion of the
audit.                                                                                                                              

| | vi)   | Ensure disclosure of any specific policies or procedures
      adopted by the Committee to satisfy pre-approval requirements for
      non-audit services by the independent auditor.                                                                                                                                                                                                                                                                                                                            
| | ----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | vii)  | Review the relationship of non-audit fees to audit fees
      paid to the independent auditor to ensure that auditor independence is
      maintained.                                                                                                                                                                                                                                                                                                                                                           
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | viii) | Ensure that both the audit and non-audit fees are
      disclosed to shareholders by category.                                                                                                                                                                                                                                                                                                                                                                                                                   
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | ix)   | Review the performance of the independent auditor and
      approve any proposed discharge and replacement of the independent auditor
      when circumstances warrant. Consider with management and the independent
      auditor the rationale for employing accounting/auditing firms other than
      the principal independent auditor.                                                                                                                                                                     
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | x)    | At least annually, consult with the independent auditor
      out of the presence of management about significant risks or exposures,
      internal controls and other steps that management has taken to control
      such risks, and the fullness and accuracy of the organizations financial
      statements. Particular emphasis should be given to the adequacy of
      internal controls to expose any payments, transactions, or procedures that
      might be deemed illegal or otherwise improper.
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | xi)   | Arrange for the independent auditor to be available to
      the Committee and the full Board as needed. Ensure that the auditors
      report directly to the Committee and are made accountable to the Board and
      the Committee, as representatives of the shareholders to whom the auditors
      are ultimately responsible.                                                                                                                                                                            
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | xii)  | Oversee the work of the independent auditor undertaken
      for the purpose of preparing or issuing an audit report or performing
      other audit, review or attest services.                                                                                                                                                                                                                                                                                                                                 

---

| | xiii) | Ensure that the independent auditor is prohibited from
      providing the following non-audit services and determining which other
      non-audit services the independent auditor is prohibited from
      providing:
| | ----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | a) | bookkeeping or other services related to the accounting
      records or financial statements of the Company;
| | -- | -------------------------------------------------------------------------------------------------------------
| |    |                                                                                                              
| | b) | financial information systems design and
      implementation;                                               
| |    |                                                                                                              
| | c) | appraisal or valuation services, fairness opinions, or
      contribution-in- kind reports;                  
| |    |                                                                                                              
| | d) | actuarial services;                                                                                          
| |    |                                                                                                              
| | e) | internal audit outsourcing services;                                                                         
| |    |                                                                                                              
| | f) | management functions or human resources;                                                                     
| |    |                                                                                                              
| | g) | broker or dealer, investment adviser or investment
      banking services;                                   
| |    |                                                                                                              
| | h) | legal services and expert services unrelated to the
      audit; and                                         
| |    |                                                                                                              
| | i) | any other services which the Public Company Accounting
      Oversight Board determines to be
impermissible. 

| | xiv) | Approve any permissible non-audit engagements of the
      independent auditor, in accordance with applicable
  legislation.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------

| | F. | Internal Auditor
| | -- | ----------------

| | i)   | Review the effectiveness and independence of the internal
      auditor function and ensure there are no unjustified restrictions or
      limitations on the functioning of the internal auditor;
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |      |                                                                                                                                                                                                   
| | ii)  | Review and approve the scope of the proposed internal
      audit plan and ensure it addresses key areas of risk;                                                                                 
| |      |                                                                                                                                                                                                   
| | iii) | Periodically review:                                                                                                                                                                              

| | a) | progress on the internal audit plan, including any
      significant changes to it;                                                   
| | -- | --------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                       
| | b) | significant internal audit findings, including issues
      relating to the adequacy of internal control over financial
    reporting;
| |    |                                                                                                                                       
| | c) | any significant internal fraud issues;
  and                                                                                          

| | iv) | Ensure the internal audits significant findings and
      recommendations are received, discussed and appropriately acted upon by
      the Committee and management.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

| | G. | Financial Reporting
Processes
| | -- | -----------------------------

| | i)   | Periodically review the adequacy and effectiveness of the
      companys disclosure controls and procedures and the Companys internal
      control over financial reporting, including any significant deficiencies
      and significant changes in internal controls.                                                                                                                                                                           
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | ii)  | Understand the scope of the independent auditors
      examination and report on the Companys assessment of internal control
      over financial reporting and review and discuss significant findings and
      recommendations, together with managements responses.                                                                                                                                                                           
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | iii) | Consider the independent auditors judgments about the
      quality, appropriateness and acceptability, of the Companys accounting
      principles and financial disclosure practices, as applied in its financial
      reporting, particularly about the degree of aggressiveness or conservatism
      of its accounting principles and underlying estimates and whether those
      principles are common practices or are minority practices.
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | iv)  | Consider and approve, if appropriate, major changes to
      the Companys accounting principles and practices as suggested by
      management with the concurrence of the independent auditor and ensure that
      the accountants' reasoning is described in determining the appropriateness
      of changes in accounting principles and
disclosure.                                                                                           

| | H. | Process Improvement
| | -- | -------------------

| | i)   | Discuss with the independent auditor (i) the auditors
      internal quality-control procedures; and (ii) any material issues raised
      by the most recent internal quality-control review, or peer review, of the
      auditors, or by any inquiry of investigation by governmental or
      professional authorities, within the preceding five years, respecting one
      or more independent audits carried out by the auditors, and any steps
      taken to deal with any such issues.
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | ii)  | Reviewing and approving hiring policies for employees or
      former employees of the past and present independent auditors.                                                                                                                                                                                                                                                                                                                                                                     
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | iii) | Establish regular and separate systems of reporting to
      the Audit Committee by each of management and the independent auditor
      regarding any significant judgments made in managements preparation of
      the financial statements and the view of each as to appropriateness of
      such judgments.                                                                                                                                                                               
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | iv)  | Review the scope and plans of the independent auditor's
      audit and reviews prior to the audit and reviews being conducted. The
      Committee may authorize the independent auditor to perform supplemental
      reviews or audits as the Committee may deem desirable.                                                                                                                                                                                                                    
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | v)   | Following completion of the annual audit and quarterly
      reviews, review separately with each of management and the independent
      auditor any significant changes to planned procedures, any difficulties
      encountered during the course of the audit and reviews, including any
      restrictions on the scope of work or access to required information and
      the cooperation that the independent auditor received during the course of
      the audit and reviews.         

---

| | vi)   | Review any significant disagreements among management and
      the independent auditor in connection with the preparation of the
      financial statements.                                                                                                                                                                                                                                                      
| | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                    
| | vii)  | Where there are significant unsettled issues the
      Committee shall ensure that there is an agreed course of action for the
      resolution of such matters.                                                                                                                                                                                                                                                   
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                    
| | viii) | Review with the independent auditor and management
      significant findings during the year and the extent to which changes or
      improvements in financial or accounting practices, as approved by the
      Audit Committee, have been implemented. This review should be conducted at
      an appropriate time subsequent to implementation of changes or
      improvements, as decided by the Committee.
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                    
| | ix)   | Review activities, organizational structure, and
      qualifications of the CFO and the staff in the financial reporting area
      and see to it that matters related to succession planning within the
      Company are raised for consideration at the full
Board.                                                                                                                                            

| | I. | Ethical and Legal
Compliance
| | -- | ----------------------------

| | i)   | Review managements monitoring of the Companys system in
      place to ensure that the Companys financial statements, reports and other
      financial information disseminated to governmental organizations, and the
      public satisfy legal requirements.
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |      |                                                                                                                                                                                                                                                                    
| | ii)  | Review, with the Companys counsel, legal and regulatory
      compliance matters, including corporate securities trading policies, and
      matters that could have a significant impact on the organizations
      financial statements.                       
| |      |                                                                                                                                                                                                                                                                    
| | iii) | Review implementation of compliance with the
      Sarbanes-Oxley Act, Ontario Securities Commission requirements and other
      legal requirements.                                                                                                              
| |      |                                                                                                                                                                                                                                                                    
| | iv)  | Ensure that the CEO and CFO provide written certification
      with annual and interim financial statements and interim MD&A and the
      Annual Information Form.                                                                                               

| | J. | Risk Management
| | -- | ---------------

| | i)   | Make inquiries of management and the independent auditor
      to identify significant business, political, financial and control risks
      and exposures and assess the steps management has taken to minimize such
      risk to the Company.
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |      |                                                                                                                                                                                                                                                  
| | ii)  | Ensure that the disclosure of the process followed by the
      Board and its committees, in the oversight of the Companys management of
      principal business risks, is complete and fairly presented.                                      
| |      |                                                                                                                                                                                                                                                  
| | iii) | Review managements program of risk assessment and steps
      taken to manage these risks and exposures, including insurance
      coverage.                                                                                                    

| | K. | General
| | -- | -------

| | i) | Conduct or authorize investigations into any matters
      within the Committees scope of responsibilities. The Committee shall be
      empowered to retain independent counsel, accountants and other
      professionals to assist it in the conduct of any
  investigation.
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

| | ii)  | The Committee shall comply with the requirements set out
      in the Board Guidelines relating to the engagement of outside
    advisors.                                                                                                                                                                                                                                                      
| | ---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |      |                                                                                                                                                                                                                                                                                                                                                                                                 
| | iii) | The Company must provide funding for the Committee to pay
      ordinary administrative expenses that are necessary for the Committee to
      carry out its duties.                                                                                                                                                                                                                            
| |      |                                                                                                                                                                                                                                                                                                                                                                                                 
| | iv)  | Establish procedures for the receipt, retention and
      treatment of complaints received by the Company regarding accounting,
      internal accounting controls, or auditing matters; and the confidential,
      anonymous submission by employees of concerns regarding questionable
      accounting or auditing matters and institute and oversee special
      investigations as needed.
| |      |                                                                                                                                                                                                                                                                                                                                                                                                 
| | v)   | Review the findings of any examinations by regulatory
      agencies with respect to financial matters, and any external auditors
      observations made regarding those findings.                                                                                                                                                                                                             
| |      |                                                                                                                                                                                                                                                                                                                                                                                                 
| | vi)  | Ensure disclosure in the Annual Information Form if, at
      any time since the commencement of most recently completed financial year,
      the issuer has relied on any possible exemptions for Audit
    Committees.                                                                                                                                                                       
| |      |                                                                                                                                                                                                                                                                                                                                                                                                 
| | vii) | Perform any other activities consistent with this
      Charter, the Companys Articles and By-laws and governing law, as the
      Committee or the Board deems necessary or
appropriate.                                                                                                                                                                                                      

|IV. | ACCOUNTABILITY
|--- | --------------

| | A. | The Committee Chair has the responsibility to make
      periodic reports to the Board, as requested, on audit and financial
      matters relative to the Company.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                    
| | B. | The Committee shall report its discussions to the Board
      by maintaining minutes of its meetings and providing an oral report at the
      next Board meeting. 
| |    |                                                                                                                                                                    
| | C. | The minutes of the Audit Committee should be filed with
      the Corporate Secretary.                                                                             

|V. | COMMITTEE TIMETABLE
|-- | -------------------

The timetable on the following pages outlines the Committees
schedule of activities during the year.

---

Q1
    Q2
    Q3
    Q4A.
    Create
      agenda for ensuing year.
    √B.
    Review and update Committee Charter
    √C.
    Describe briefly in the Companys Management
      Information Circular and/or the Companys Annual Information Form the
      Committees composition and responsibilities and how they were discharged.
    √D.
    Documents/Reports Review
    √
    √
    √
    √i)
    Review with management and independent auditor,
      interim and annual financial statements, MD&A, earnings releases and
      any other financial information to be publicly disclosed and recommend
      approval to Boardii)
    Review analyses prepared by management and/or
      independent auditor setting forth significant financial reporting issues
      and judgments made in connection with the preparation of the financial
      statements
    √
    √
    √
    √iii)
    Review effect of regulatory and accounting
      initiatives, as well as off balance sheet structures, on the financial
      statements
    √
    √
    √
    √iv)
    Review policies and procedures with respect to
      directors and officers expense accounts and management perquisites and
      benefits, and review results of procedures performed in these areas by the
      independent auditor
    √v)
    Review Board Chair & CEO expenses
    √


---

Q1
    Q2
    Q3
    Q4vi)
    Ensure adequate procedures are in place to review
      disclosure of financial information extracted or derived from financial
      statements, and review any financial information and earnings guidance
      provided to analysts and rating agencies, and periodically assess adequacy
      of those procedures
    √
    √
    √
    √E.
    Independent Auditor
    
    
    √i)
    Recommend independent auditor to Board and
      consider independence and effectiveness and approve compensation for
      independent auditorii)
    Review and approve the independent auditors
      audit plan and engagement letter and approve the audit scope and approach,
      staffing, locations, reliance upon management and internal audit and
      general audit approach
    
    
    
    √iii)
    Monitor relationship between management and
      independent auditor
    √
    √
    √
    √iv)
    Review and discuss with independent auditor all
      significant relationships they have with the Company to determine their
      independence, and report to Board
    √
    √
    √
    √v)
    Review and approve requests for non-audit
      services to be performed by independent auditor & be advised of any
      study undertaken at request of management beyond scope of audit engagement
      letter and related fees
    As Requiredvi)
    Ensure disclosure of any specific policies or
      procedures adopted to satisfy pre-approval requirements for non-audit
      services by independent auditor
    √


---

Q1
    Q2
    Q3
    Q4vii)
    Review relationship of non-audit fees to audit
      fees paid to independent auditor
    √
    √
    √
    √viii)
    Ensure audit and non-audit fees are disclosed
      by category
    √
    √
    √
    √ix)
    Review independent auditor performance and
      approve any proposed discharge and replacement of independent auditor.
      Consider with management and independent auditor the rationale for
      employing accounting/auditing firms other than the principal independent
      auditor
    √
    √
    √
    √x)
    Consult with independent auditor out of
      presence of management about significant risks or exposures, internal
      controls and other steps that management has taken to control such risks,
      and the fullness and accuracy of the organizations financial statements
    √
    √
    √
    √xi)
    Arrange for independent auditor to be available
      to the Committee and Board. Ensure independent auditors report directly to
      the Committee and are made accountable to the Board and the Committee
    √
    √
    √
    √xii)
    Oversee independent auditor
    √
    √
    √
    √xiii)
    Ensure independent auditor is prohibited from
      providing certain non-audit services
    √
    √
    √
    √F.
    Internal Auditor
    √i)
    Review effectiveness and independence of the
      internal auditor function and ensure there are no unjustified restrictions
      or limitations on the functioning of the internal auditor


---

Q1
    Q2
    Q3
    Q4ii)
    Review and approve the scope of the
      proposed internal audit plan and ensure it addresses key areas of risk
    
    
    √iii)
    Periodically review:
    √
    √
    √
    √a)
    progress on the internal audit plan, including
      any significant changes to it;
    √b)
    significant internal audit findings, including
      issues relating to the adequacy of internal control over financial
      reporting; andc)
    any significant internal fraud issues
    √
    √
    √
    √iv)
    Ensure the internal audits
      significant findings and recommendations are received, discussed and
      appropriately acted upon by the Committee and management.
    √
    √
    √
    √G.
    Financial Reporting Processes
    √i)
    Periodically review the adequacy and
      effectiveness of the Companys disclosure controls and procedures and the
      Companys internal control over financial reporting, including any
      significant deficiencies and significant changes in internal controls


---

Q1
    Q2
    Q3
    Q4ii)
    Understand the scope of the independent
      auditors examination and report on the Companys assessment of internal
      control over financial reporting and review and discuss significant
      findings and recommendations, together with managements responses.
    √iii)
    Consider independent auditors judgments about
      quality, appropriateness and acceptability of accounting principles and
      financial disclosure practices
    √
    √
    √
    √iv)
    Consider and approve any major changes to
      accounting principles and practices
    √
    √
    √
    √H.
    Process Improvement
    √i)
    Discuss with independent auditor (i) auditors
      internal quality-control procedures; and (ii) any material issues raised
      by the most recent internal quality- control review, or peer review, of
      the auditors, or by any inquiry of investigation by governmental or
      professional authorities, within the preceding 5 years, respecting
      independent audits carried out by auditors and steps taken to deal with
      such issuesii)
    Review and approve hiring policies for
      employees or former employees of the past and present independent auditors
    As Requirediii)
    Establish reporting system for management and
      independent auditor regarding significant judgments made in managements
      preparation of financial statements
    √
    √
    √
    √iv)
    Review scope and plans of independent auditor's
      audit and reviews
    
    
    √


---

Q1
    Q2
    Q3
    Q4v)
    Review with management and independent auditor
      significant changes to planned procedures, difficulties encountered during
      course of audit and reviews, and cooperation received by independent
      auditor during course of audit and reviews
    √
    √
    √
    √vi)
    Review significant disagreements among
      management and independent auditor connected with financial statement
      preparation
    √
    √
    √
    √vii)
    Ensure course of action for resolving
      significant unsettled issues
    √
    √
    √
    √viii)
    Review with independent auditor and management
      significant findings and the extent to which changes or improvements in
      financial or accounting practices have been implemented
    √ix)
    Review activities, organizational structure,
      and qualifications of CFO and financial reporting staff and ensure matters
      related to succession planning are raised with Board
    √I.
    Ethical and Legal Compliance
    √
    √
    √
    √i)
    Review managements monitoring system for
      ensuring financial statements, reports and other financial information
      disseminated to governmental organizations, and the public satisfy legal
      requirementsii)
    Review with counsel, legal and regulatory
      compliance matters and matters that could have significant impact on
      financial statements
    √
    √
    √
    √iii)
    Review implementation of compliance with SOX
      and OSC requirements
    √
    √
    √
    √


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Q1
    Q2
    Q3
    Q4iv)
    Ensure CEO and CFO certify annual and interim
      financial statements and interim and annual MD&A
    √
    √
    √
    √J.
    Risk Management
    √
    √
    √
    √i)
    Inquire of management and independent auditor
      to identify significant business, political, financial and control risks
      and exposures and assess the steps management has taken to minimize such
      riskii)
    Ensure disclosure of process followed by Board
      and committees for oversight of management of principal business risks, is
      complete and fairly presented
    √iii)
    Review managements risk assessment program and
      steps taken to manage risks and exposures
    √
    √
    √
    √K.
    General
    As Requiredi)
    Conduct or authorize investigations into
      matters within the Committees scope of responsibilities


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Q1
    Q2
    Q3
    Q4ii)
    With the approval of the Board Chair and in
      consultation with the CEO where reasonably practical, each committee has
      the authority and responsibility to engage, set the terms of, compensate
      and oversee any outside advisor that it determines to be necessary to
      permit it to carry out its duties. In considering the selection of any
      outside advisor, the applicable committee shall conduct an independence
      assessment of such advisor, having regard to, among other matters, (A) the
      provision of other services provided by the advisor to the Company, (B)
      the amount of fees received by the advisor from the Company as a
      percentage of total revenue of the advisor, (C) policies of the advisor
      designed to prevent conflicts of interest, (D) any business or personal
      relationship of the advisor with a member of the committee, Board or
      executives of the Company, (E) any shares or securities of the Company by
      the advisor, and (F) any business or personal relationship of the advisor
      with an executive officer of the Company.
    As Requirediii)
    Acquire funding from the Company to pay for
      ordinary administrative expenses
    As Requirediv)
    Establish procedures for receipt, retention and
      treatment of complaints regarding accounting, internal accounting
      controls, or auditing matters; and for anonymous submission by employees
      of concerns regarding questionable accounting or auditing matters and
      institute and oversee special investigations as needed
    √
    √
    √
    √


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Q1
    Q2
    Q3
    Q4v)
    Review the findings of any examinations by
      regulatory agencies with respect to financial matters, and any external
      auditors observations made regarding those findings
    As
      Requiredvi)
    Ensure disclosure in AIF if any possible
      exemptions for Audit Committees have been used
    √vii)
    Assess adequacy of these terms of reference and
      recommend to Board
    √viii)
    Conduct annual self-evaluation and report to
      Board
    √


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APPENDIX ONE TO SCHEDULE A

SILVER WHEATON CORP. AUDIT COMMITTEE CHARTER

Affiliated Person under SEC Rules

An affiliated person, in accordance with the rules of the
United States Securities and Exchange Commission adopted pursuant to the
Sarbanes-Oxley Act, means a person who directly or indirectly controls
the Company, or a director, executive officer, partner, member, principal or
designee of an entity that directly, or indirectly through one or more
intermediaries, controls, or is controlled by, or is under common control with,
the Company.

Financial Literacy Under Multilateral Instrument 52-110

Financially literate, in accordance with MI 52-110, means
that the director has the ability to read and understand a set of financial
statements that present a breadth and level of complexity of accounting issues
that are generally comparable to the breadth and complexity of the issues that
can reasonably be expected to be raised by the Companys financial statements.

Financial Expert Under SEC Regulation S-K

A person will qualify as financial expert if he or she
possesses the following attributes:

|a) | an understanding of financial statements and generally
      accepted accounting principles;                                                                                                                                                                                                                                                                                                                               
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                            
|b) | the ability to assess the general application of such
      principles in connection with the accounting for estimates, accruals and
      reserves;                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                            
|c) | experience preparing, auditing, analyzing or evaluating
      financial statements that present a breadth and level of complexity of
      accounting issues that are generally comparable to the breadth and
      complexity of issues that can reasonably be expected to be raised by the
      Companys financial statements, or experience actively supervising one or
      more persons engaged in such activities;
|   |                                                                                                                                                                                                                                                                                                                                                                                                                            
|d) | an understanding of internal controls and procedures for
      financial reporting; and                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                            
|e) | an understanding of audit committee
  functions.                                                                                                                                                                                                                                                                                                                                                                           

A person shall have acquired such attributes through:

|a) | education and experience as a principal financial
      officer, principal accounting officer, controller, public accountant or
      auditor or experience in one or more positions that involve the
      performance of similar functions;
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                              
|b) | experience actively supervising a principal financial
      officer, principal accounting officer, controller, public accountant,
      auditor or person performing similar functions;                                                      
|   |                                                                                                                                                                                                                                              
|c) | experience overseeing or assessing the performance of
      companies or public accountants with respect to the preparation, auditing
      or evaluation of financial statements; or                                                        
|   |                                                                                                                                                                                                                                              
|d) | other relevant experience.                                                                                                                                                                                                                   

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Item
    
    CSA*
    NYSE**Ensure that the CEOs Terms of Reference include
      responsibility to make annual and interim written affirmations regarding
      the Audit Committee, and ensure that such written affirmations are
      submitted as required.
    
    
    √Disclose the text
      of the Audit Committees charter.
    
    √Disclose names of committee members and state whether or
      not each is (i) independent and (ii) financially literate. Describe each
      members education and experience relevant to responsibilities.
    
    √Disclosure whether, at any time since the commencement of
      most recently completed financial year, the Company has relied on any
      possible exemptions for Audit Committees.
    
    √If, at any time since the commencement of the issuers most
      recently completed financial year, a recommendation of the audit committee
      to nominate or compensate an external auditor was not adopted by the board
      of directors, state that fact and why.
    
    √Disclose by category how much the auditor is paid for
      consulting and other services.
    
    √Disclose any specific policies or procedures adopted by the
      Audit Committee for pre-approval of non-audit services by the external
      auditor.
    
    √Prepare and disclose any Audit Committee reports required
      by applicable regulators.
    
    √


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