---

|CAMBIOR 2005
    ANNUAL REPORT | 39
|------------------------------ | --

AUDITORS' REPORT

To the Shareholders of Cambior Inc.

We have audited the consolidated balance sheets of Cambior
Inc. as at December 31, 2005 and 2004 and the consolidated statements of
operations, contributed surplus and deficit and cash flows for each of the years
in the three-year period ended December 31, 2005. These financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audits.

We conducted our audits in accordance with Canadian generally
accepted auditing standards. Those standards require that we plan and perform an
audit to obtain reasonable assurance whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation.

In our opinion, these consolidated financial statements
present fairly, in all material respects, the financial position of the Company
as at December 31, 2005 and 2004 and the results of its operations and cash
flows for each of the years in the three-year period ended December 31, 2005 in
accordance with Canadian generally accepted accounting principles.

Chartered Accountants

Montréal, Canada 
February 20, 2006

Comments by Auditors for American Readers on Canada-US Reporting Differences

In the United States of America, reporting standards for auditors require the
addition of an explanatory paragraph (following the opinion paragraph) when
there is a change in accounting principles that has a material effect on the
comparability of the Company's financial statements, such as the changes
described in Notes 3 and 24A to the consolidated financial statements. Our
report to the shareholders dated February 20, 2006 is expressed in accordance
with Canadian reporting standards which does not require a reference to such
change in accounting principles in the auditors' report when the change is
properly accounted for and adequately disclosed in the consolidated financial
statements.

Chartered Accountants

Montréal, Canada 
February 20, 2006

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|40 | CAMBIOR 2005 ANNUAL REPORT
|-- | --------------------------

|                                                                                          |      |         |          |        
|----------------------------------------------------------------------------------------- | ---- | ------- | -------- | -------
|CONSOLIDATED OPERATIONS                                                                  
|                                                                                          |      |         |          |        
|Years ended December 31                                                                   |      |         |          |        
|(In thousands of United States dollars, except for amounts
    per share)                 | Note | 2005    | 2004     | 2003   
|                                                                                          |      | $       | $        | $      
|Revenues                                                                                  |      |         |          |        
|Mining operations                                                                         |      | 367,887 | 299,981  | 190,869
|Investment and other income                                                               |      | 598     | 937      | 2,997  
|                                                                                          |      | 368,485 | 300,918  | 193,866
|Expenses                                                                                  |      |         |          |        
|Mining operations                                                                         |      | 282,219 | 224,511  | 151,804
|Depreciation, depletion and amortization                                                  |      | 47,931  | 46,937   | 28,734 
|Exploration and business development                                                      |      | 5,962   | 10,201   | 7,572  
|General and administrative                                                                |      | 10,884  | 8,917    | 6,083  
|Financial expenses                                                                        |      | 4,692   | 4,117    | 1,923  
|Stock-based compensation                                                                  | 17   | 1,595   | 1,580    |       
|Loss (Gain) on foreign exchange                                                           |      | 98      | 1,103    | (1,862)
|                                                                                          |      | 353,381 | 297,366  | 194,254
|Earnings (Loss) before the undernoted items                                               |      | 15,104  | 3,552    | (388)  
|Gain on disposal of assets                                                                |      | 12,540  |         |       
|Non-hedge derivative gain                                                                 | 21   | 2,697   | 2,551    | 635    
|Gain on foreign exchange from reduction in
    net investment                             | 19   | 742     |         |       
|Impairment loss and restructuring costs                                                   | 4    |        | (73,152) |       
|Income and mining taxes                                                                   | 20   | (9,961) | (6,160)  | 554    
|Non-controlling interest                                                                  |      | (920)   | (565)    |       
|Net earnings (loss)                                                                       |      | 20,202  | (73,774) | 801    
|                                                                                          |      |         |          |        
|Basic net earnings (loss) per share                                                       |      | 0.07    | (0.30)   | 0.00   
|Diluted net earnings (loss) per share                                                     |      | 0.07    | (0.30)   | 0.00   
|                                                                                          |      |         |          |        
|Basic weighted average number of common shares outstanding
    (in thousands)             | 16   | 274,339 | 249,321  | 187,953
|Diluted weighted average number of common shares outstanding
    (in thousands)           | 16   | 275,890 | 249,321  | 190,577
|The accompanying notes are an
    integral part of the consolidated financial statements.



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|CAMBIOR 2005
    ANNUAL REPORT | 41
|------------------------------ | --

|CONSOLIDATED CONTRIBUTED
    SURPLUS AND DEFICIT                                             |      |           |          
|-------------------------------------------------------------------------------------------- | ---- | --------- | ---------
|                                                                                             |      |           |          
|Years ended December 31 (In thousands of United States
    dollars)                          | Note | 2005      | 2004     
|                                                                                             |      | $         | $        
|CONTRIBUTED SURPLUS                                                                          |      |           |          
|Balance, beginning of year, as previously
    reported                                       |      | 17,039    |         
|Restatement for the fair value of options granted in prior
    years                         | 3    |          | 15,661   
|Restated balance, beginning of year                                                          |      | 17,039    | 15,661   
|Stock-based compensation                                                                     | 17   | 1,595     | 1,580    
|Options exercised and transferred to capital
    stock                                       | 17   | (262)     | (202)    
|Common share purchase options expired                                                        | 16   | 6         |         
|Balance, end of year                                                                         |      | 18,378    | 17,039   
|                                                                                             |      |           |          
|DEFICIT                                                                                      |      |           |          
|Balance, beginning of year, as previously
    reported                                       |      | (204,477) | (111,006)
|Prior years' adjustment to reflect change in accounting for
    asset retirement obligations | 3    |          | 2,082    
|                                                                                             |      | (204,477) | (108,924)
|Restatement for stock-based compensation                                                     | 3    |          | (15,873) 
|Restated balance, beginning of year                                                          |      | (204,477) | (124,797)
|Net earnings (loss)                                                                          |      | 20,202    | (73,774) 
|Share and warrant issue expenses, net of
    income taxes                                    |      | (66)      | (5,906)  
|Balance, end of year                                                                         |      | (184,341) | (204,477)
|The accompanying notes are an integral
    part of the consolidated financial statements.    |      |           |          



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|42 | CAMBIOR 2005 ANNUAL REPORT
|-- | --------------------------

|                                                                                          |      |          |           |          
|----------------------------------------------------------------------------------------- | ---- | -------- | --------- | ---------
|CONSOLIDATED CASH FLOWS                                                                   |      |          |           |          
|                                                                                          |      |          |           |          
|Years ended December 31 (In thousands of United States
    dollars)                       | Note | 2005     | 2004      | 2003     
|                                                                                          |      | $        | $         | $        
|OPERATING ACTIVITIES                                                                      |      |          |           |          
|Net earnings (loss)                                                                       |      | 20,202   | (73,774)  | 801      
|Disbursement  asset retirement obligations                                               | 14   | (3,427)  |          |         
|Deferred gains                                                                            |      |         |          | (680)    
|Non-cash items                                                                            |      |          |           |          
|Deferred revenue  delivery of gold on the
    prepaid forward                            | 12   | (12,222) | (12,222)  | (12,222) 
|Depreciation, depletion and amortization                                                  |      | 47,931   | 46,937    | 28,734   
|Amortization of deferred stripping costs                                                  |      |         | 4,754     | 5,741    
|Accretion expense  asset retirement obligations                                          | 14   | 1,832    | 1,787     | 995      
|Impairment loss                                                                           | 4    |         | 71,211    |         
|Amortization of deferred gains/losses                                                     |      | (489)    | (3,953)   | (865)    
|Unrealized non-hedge derivative loss (gain)                                               | 21   | (733)    | (9,339)   | 1,428    
|Stock-based compensation                                                                  |      | 1,595    | 1,580     |         
|Future income and mining taxes                                                            | 20   | 11,964   | 5,704     |         
|Non-controlling interest                                                                  |      | 920      | 565       |         
|Gain on disposal of assets                                                                |      | (12,540) |          |         
|Others                                                                                    |      | (878)    | 961       | 915      
|                                                                                          |      | 54,155   | 34,211    | 24,847   
|Changes in non-cash working capital items                                                 | 5    | (13,620) | 3,794     | (646)    
|Cash flow from operating activities                                                       |      | 40,535   | 38,005    | 24,201   
|                                                                                          |      |          |           |          
|INVESTING ACTIVITIES                                                                      |      |          |           |          
|Short-term investments                                                                    |      | 33,846   | 32,924    | (41,562) 
|Investments                                                                               |      | 3,846    | (14,180)  | (1,057)  
|Net disposition (acquisition) of assets and
    businesses                                | 9    | 10,163   | (56,730)  | 3,230    
|Property, plant and equipment                                                             |      | (89,697) | (76,238)  | (110,404)
|Cash flow used in investing activities                                                    |      | (41,842) | (114,224) | (149,793)
|                                                                                          |      |          |           |          
|FINANCING ACTIVITIES                                                                      |      |          |           |          
|Long-term debt  Borrowings                                                               |      | 18,084   | 2,097     | 55,000   
|Long-term debt  Repayments                                                               |      | (21,047) | (20,753)  | (28,735) 
|Deferred charges                                                                          |      | (1,260)  | (36)      | (1,790)  
|Common shares issued net of issue expenses                                                |      | 336      | 87,150    | 113,183  
|Cash flow from (used in) financing activities                                             |      | (3,887)  | 68,458    | 137,658  
|                                                                                          |      |          |           |          
|Effect of changes in the exchange rate on cash held in
    foreign currency               |      | (244)    | 331       | (1,211)  
|Net increase (decrease) in cash and cash equivalents                                      |      | (5,438)  | (7,430)   | 10,855   
|Cash and cash equivalents, beginning of year                                              |      | 21,020   | 28,450    | 17,595   
|Cash and cash equivalents, end of year                                                    | 6    | 15,582   | 21,020    | 28,450   
|The accompanying notes are an
    integral part of the consolidated financial statements.



---



|CAMBIOR 2005
    ANNUAL REPORT | 43
|------------------------------ | --

|CONSOLIDATED BALANCE SHEETS                                                               |      |           |          
|----------------------------------------------------------------------------------------- | ---- | --------- | ---------
|                                                                                          |      |           |          
|As at December 31 (In thousands of United States dollars)                                 | Note | 2005      | 2004     
|                                                                                          |      | $         | $        
|ASSETS                                                                                    |      |           |          
|Current assets                                                                            |      |           |          
|Cash and short-term investments                                                           | 6    | 15,582    | 54,866   
|Receivables                                                                               |      | 41,497    | 22,227   
|Production inventories                                                                    |      | 13,209    | 13,691   
|Supplies inventory and prepaid expenses                                                   |      | 43,378    | 37,903   
|Current portion of deferred losses                                                        | 13   |          | 4,646    
|Fair value of non-hedge derivatives                                                       |      | 1,082     | 1,549    
|Future income and mining tax assets                                                       | 20   | 14,679    | 12,985   
|                                                                                          |      | 129,427   | 147,867  
|Investments and other assets                                                              | 7    | 31,433    | 20,748   
|Property, plant and equipment                                                             | 8    | 454,866   | 398,847  
|Assets held for sale                                                                      | 9    |          | 22,952   
|Future income and mining tax assets                                                       |      | 5,628     |         
|                                                                                          |      | 621,354   | 590,414  
|                                                                                          |      |           |          
|LIABILITIES                                                                               |      |           |          
|Current liabilities                                                                       |      |           |          
|Accounts payable and accrued liabilities                                                  |      | 54,667    | 61,133   
|Current portion of long-term liabilities                                                  | 10   | 23,642    | 36,868   
|Fair value of hedge derivatives                                                           | 21   | 9,463     |         
|                                                                                          |      | 87,772    | 98,001   
|Long-term debt                                                                            | 11   | 41,793    | 44,442   
|Deferred gains                                                                            | 13   |          | 204      
|Liability for asset retirement obligations
    and others                                 | 14   | 33,805    | 25,959   
|Accrued benefit liabilities                                                               | 15   | 5,644     | 5,638    
|Fair value of hedge derivatives                                                           | 21   | 4,066     | 14,273   
|Future income and mining tax liabilities                                                  | 20   | 39,846    | 21,117   
|Non-controlling interest                                                                  |      | 6,708     | 5,788    
|                                                                                          |      | 219,634   | 215,422  
|                                                                                          |      |           |          
|SHAREHOLDERS' EQUITY                                                                      |      |           |          
|Common shares and options                                                                 | 16   | 546,156   | 545,498  
|Equity component of convertible debenture                                                 |      | 262       | 262      
|Contributed surplus                                                                       |      | 18,378    | 17,039   
|Deficit                                                                                   |      | (184,341) | (204,477)
|Cumulative translation adjustment                                                         | 19   | 21,265    | 16,670   
|                                                                                          |      | 401,720   | 374,992  
|                                                                                          |      | 621,354   | 590,414  
|Commitments and contingencies                                                             | 21   |           |          
|The accompanying notes are an
    integral part of the consolidated financial statements.

|                            |                
|--------------------------- | ---------------
|On behalf of the
    Board, |                
|                            |                
|                            |                
|Robert Normand              | Louis P. Gignac
|Director                    | Director       

---

44
    CAMBIOR 2005 ANNUAL REPORTNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (All amounts are in United States dollars except where otherwise indicated;
amounts in tables are in thousands of US dollars, except for amounts per share.)
1. Incorporation and OperationsCambior Inc. ("Cambior" or the "Company"), continued and existing under Part
1A of the Companies Act (Québec), is engaged in the exploration,
development and operation of gold mining properties. The Company also owns and
operates niobium and refractory grade bauxite mines. The Company's main
operating units are located in Canada, Guyana and Suriname.2. Accounting PoliciesThe consolidated financial statements are prepared in accordance with
Canadian generally accepted accounting principles ("GAAP"). As described in Note
24, these principles differ in certain material respects from principles and
practices that the Company would have followed had its consolidated financial
statements been prepared in accordance with accounting principles generally
accepted in the United States of America ("United States" or "US") ("US GAAP").
The principal accounting policies followed by the Company are as follows:Principles of ConsolidationThe consolidated financial statements include the accounts of Cambior and of
its subsidiaries. The Company's share in joint ventures is accounted for using
the proportionate consolidation method. All significant intercompany balances
and transactions have been eliminated.Use of EstimatesThe preparation of consolidated financial statements in conformity with GAAP
requires management to make estimates and assumptions. These estimates and
assumptions affect the amounts reported in the consolidated financial statements
and related notes. The Company regularly reviews the estimates and assumptions
that affect the consolidated financial statements, and actual results could
differ from these estimates. Significant areas where management judgment is
applied are mineral reserves, asset valuations, contingent liabilities, asset
retirement obligations, employee future benefit costs, fair value of derivative
instruments, and future income and mining taxes. In the opinion of management,
all adjustments considered necessary for fair presentation of the results for
the periods presented are reflected in the consolidated financial statements.Foreign Currency TranslationThe US dollar is the reporting currency of the Company.
The functional currency of Canadian mining activities is the Canadian dollar.
Assets and liabilities of Canadian mining activities are translated into US
dollars at the exchange rate in effect at the balance sheet date and revenues
and expenses are translated at the average rate in effect during the year.
Translation adjustments arising from changes in exchange rates are deferred and
included in a separate component of shareholders' equity.
The US dollar is the functional currency for the Company's activities in
Guyana, Suriname and French Guiana, inasmuch as all proceeds from the sale of
production are in US dollars and the majority of the disbursements made for the Omai Gold mine, Omai Bauxite mine, Rosebel mine and Camp Caiman project are in
US dollars.
Other monetary assets and liabilities in currencies other than the respective
functional currencies are translated at the exchange rate in effect at the
balance sheet date, whereas other non-monetary assets and liabilities in such
currencies are translated at the exchange rate in effect at the transaction
date. Revenues and expenses in such currencies are translated at the average
rate in effect during the year, with the exception of depreciation, depletion
and amortization which are translated at the historical rate. Gains and losses
are recorded in operations for the year.Cash and Cash EquivalentsCash and cash equivalents include cash funds, bank balances and short-term
investments in money market instruments with an original term of less than three
months that are carried at the lower of cost and fair value.Short-term InvestmentsShort-term investments consist of investments in money market instruments
with an original term of three months or more, but no longer than one year, that
are carried at the lower of cost and fair value.

---

CAMBIOR 2005
    ANNUAL REPORT
    45Production InventoriesProduction inventories are valued at the lower of average production cost and
net realizable value. Depreciation, depletion and amortization are treated as a
product cost, and are expensed when the product is sold.Supplies InventorySupplies inventory is valued at the lower of average cost and replacement
cost.Property, Plant and Equipment
(i) Property, Plant and EquipmentProperty, plant and equipment are accounted for at cost. The depreciation,
  depletion and amortization of mining properties, development expenses and
  buildings and equipment related to mines are based on the units of production
  method over the estimated economic life of the related deposit. However, if
  the anticipated useful life of the assets is less than the life of the
  deposit, depreciation is based on their anticipated useful life.
  Other property, plant and equipment are depreciated under the straight-line
  method according to their anticipated useful lives, which is ten years for
  office furniture, five years for vehicles and office equipment and the term of
  the lease for leasehold improvements.(ii) Capitalization of Financial CostsFinancial costs are capitalized when relating to indebtedness incurred to
  finance construction and development activities, prior to the commencement of
  commercial production.(iii) Deferred Stripping CostsPrior to 2005, mining costs associated with stripping activities were
  deferred in the case of an open pit mine if the actual ratio of total tonnes
  of material mined relative to gold production, in a given year, was higher
  than the estimated average ratio for the life of the mine. These mining costs
  were subsequently charged to operations and included in mining operations
  expenses in the periods during which said ratio was lower than the estimated
  average ratio for the life of the mine.(iv) Exploration PropertiesExploration expenses incurred to the date of establishing that a property
  has mineral resources which have the potential of being economically
  recoverable are charged to operations; exploration and development expenses
  incurred subsequent to this date are allocated to property, plant and
  equipment under mining projects. Significant payments related to the
  acquisition of land and mineral rights are capitalized.(v) Impairment of Long-lived AssetsThe Company periodically reviews the carrying amount of its property, plant
  and equipment. An impairment loss must be recognized if the carrying amount of
  a long-lived asset exceeds the sum of the undiscounted cash flows expected to
  result from its use and eventual disposition. Net estimated future cash flows,
  on an undiscounted basis, from each mine and mining project are calculated
  based on anticipated future metal production (proven and probable reserves as
  well as mineral resources having the potential of being economically
  recoverable), estimated future realized metal prices, operating, capital and
  site restoration expenses and estimated future foreign exchange rates. In that
  event, the asset must be written down to its fair value and an impairment loss
  recorded in the results of operations. The fair value is based on the present
  value of the estimated cash flows. Management's estimate of future cash flows
  is subject to risks and uncertainties. Therefore, it is reasonably possible
  that changes could occur which may affect the recoverability of the Company's
  property, plant and equipment.Deferred ChargesFinancing charges and charges related to the prepaid gold forward sales
agreement are amortized following the scheduled payments of the credit facility
and the sales agreement.

---

46
    CAMBIOR 2005 ANNUAL REPORTNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)2. Accounting Policies (continued)

Commodity Contracts and Financial InstrumentsThe Company enters from time to time into commodity contracts, prepaid
forward sales agreements and foreign exchange contracts to manage the price
volatility of the commodities produced at its operating mines and the foreign
currency exposure for its Canadian and French Guiana operations. The Company
also enters into foreign exchange contracts to minimize the exposure to changes
in fair value of short-term investments as a result of fluctuations in foreign
exchanges rates.i) Hedge Derivative Instruments

> The Company formally documents all relationships between
>   hedging instruments and hedged items, as well as its risk management
>   objectives and strategies for undertaking various hedge transactions. This
>   process includes linking all hedging derivatives to specific forecasted
>   transactions. The Company also formally assesses, both at the hedge's
>   inception and on an ongoing basis, whether the derivatives that are used in
>   hedging transactions are highly effective in offsetting cash flows of hedged
>   items.
>   Gold fixed forward sales and spot deferred sales
>   The objective of these instruments is to reduce the
>   variability of the cash flows from forecasted sales of gold production.
>   Changes in the cash flows from gold fixed forward sales and spot deferred
>   sales (forward transactions) are expected to be highly effective at offsetting
>   changes in the expected cash flows from forecasted sales of gold production
>   due to changes in sales prices. The forward transactions, for which the
>   quantity, price and timing of delivery are fixed, are accounted for under the
>   hedge accounting method. Where there is high certainty of delivery of gold
>   production, the Company designates a timing of production delivery. Hedge
>   effectiveness is measured by comparing the changes in the present value of the
>   sales of gold production with the change in the fair value of the forward
>   contracts. Expected cash flows from forecasted sales are based on forward
>   prices. The fair value of gold hedge derivative instruments is not included on
>   the balance sheet unless the instrument does not meet the hedge accounting
>   method requirements. Proceeds from these contracts are recognized in revenues
>   in the same period as the corresponding hedged item. When the Company delivers
>   gold production against such contracts at a date earlier than anticipated or
>   liquidates the contract before that date, any gain or loss is recognized as a
>   deferred gain or loss on the balance sheet. Subsequently, this deferred gain
>   or loss is accounted for in the statement of operations as an
>   increase/decrease in revenues for the period of the corresponding hedged
>   item's original designation date. If the Company delivers gold production
>   against such contracts at a date later than anticipated, the Company accounts
>   for the related gain or loss in revenues on the original designation date.
>   Foreign exchange fixed forwards contracts to hedge changes in
>   cash flows
>   For the Canadian and French Guiana operations, the Company
>   also enters into foreign exchange fixed forwards and spot deferred contracts
>   (foreign exchange contracts) whereby it commits to deliver US currency in
>   exchange for Canadian dollars or Euros. Because all of the Company's revenues
>   are derived in US funds and expenditures incurred by such operations are
>   denominated in Canadian dollars and Euros, the Company enters into such
>   contracts to meet the operations' needs in Canadian dollars and Euros. The
>   objective of these instruments is to reduce the variability of the cash flows
>   from forecasted sales of gold denominated in US dollars for the Canadian
>   operations and expenditures denominated in Euros for the French Guiana
>   operations. Hedge effectiveness is measured by comparing the changes in the
>   present value of gold sales denominated in US and expenditures denominated in
>   Euros with the change in the fair value of the foreign exchange contracts.
>   The fair value of foreign exchange hedge derivative
>   instruments is not included on the balance sheet unless the instrument does
>   not meet the hedge accounting method requirements. Forward contracts used to
>   hedge specific transactions having fixed terms, such as amount, price and
>   timing of delivery for Canadian operations or anticipated capital and
>   operating expenditures for the French Guiana operations are accounted for
>   using the hedge accounting method. If foreign exchange contracts are
>   repurchased before the original designation date, any gain or loss is
>   recognized as a deferred gain or loss on the balance sheet. Subsequently, this
>   deferred gain or loss is accounted for in the statement of operations as an
>   increase/decrease in revenues for Canadian operations and expenses or capital
>   expenditures for French Guiana operations, for the period of the corresponding
>   hedged item's original designation date. If foreign exchange contracts are
>   repurchased after the original designation date, the Company accounts for the
>   related gain or loss in revenues for Canadian operations and expenses or
>   capital expenditures for French Guiana operations, on the original designation
>   dates.

---

CAMBIOR 2005
    ANNUAL REPORT


    47ii) Non-hedge Derivative Instruments
Prior to 2005, in some cases, the Company utilized instruments
  with optionalities (call options, variable volume forwards ("VVF") and lease
  rate swaps) as part of its revenue protection program. Transactions in which
  there was no certainty for one or more of its key components (price, delivery
  date, quantity) did not meet the conditions of hedge accounting, and were
  treated as "non-hedge derivatives" and marked to market. Gold purchase
  commitments, including those used to offset optionalities, are also marked to
  market. The Company obtains a valuation from a counterparty of its portfolio
  of gold commitments for each reporting period. This market valuation is based
  on forward rates and considers the market price, rate of interest, gold lease
  rate and volatility. The fair value of the non-hedge instruments is included
  on the balance sheet and the change in market value from the previous
  reporting period is included in the operations statement as a non-hedge
  derivative gain or loss. The variation in these valuations can be significant
  and can have a material impact on earnings.
  If non-hedge derivative instruments (call options and VVF) are
  converted into hedge derivative instruments (fixed forwards) and included in a
  hedging relationship, any change in the fair value of the instrument after the
  conversion date is recognized in revenues as explained previously in section i).
iii) Prepaid Gold Forward Sales Contract
Since the delivery of the gold production related to the
  prepaid gold forward sales contract is probable, the Company considers this
  contract as a normal sales contract. Initial proceeds from prepaid gold
  forward sales contracts are accounted for as deferred revenue and are
  recognized in revenues from mining operations when the related ounces of gold
  are delivered.
iv) Ounces of Gold Receivable
Following the disposal of the Carlota Copper project, Cambior
  will receive ounces of gold. The fair value of the ounces of gold receivable
  was determined based on forward prices at the closing date and a risk premium.
  Cambior recognized both an amount for gold receivable and a related discount.
  The gold receivable is revaluated at each balance sheet date at the current
  spot price and the variation is accounted for under the "non-hedge derivative
  gain/loss" caption in the statement of operations. The discount is amortized
  up to the time of deliveries and is accounted for under the "investment
  income" caption in the statement of operations.
Asset Retirement Obligations
Environmental and on-going site reclamation costs at operating mines are
charged to operations in the period during which they occur. The Company
recognizes, when the legal obligation is incurred, the fair value of an
estimated liability for the future cost of restoring a mine site upon
termination of the operation with a corresponding increase in the carrying value
of the related long-lived asset. The Company amortizes the amount added to the
asset using the depreciation method established for the related asset. The
depreciation expense is included in the operations statement and accounted for
in accumulated depreciation, depletion and amortization. An accretion expense in
relation with the discounted liability over the remaining life of the mining
properties is accounted for in mining operations and added to the asset
retirement obligation. The liability is adjusted at the end of each period to
reflect the passage of time and changes in the estimated future cash flows
underlying the obligation.48
    CAMBIOR 2005 ANNUAL REPORTNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)2. Accounting Policies (continued)

Employee Future Benefit PlansThe Company accrues its obligations under employee future benefit plans and
the related costs, net of plan assets.
The cost and accrued benefit obligations are actuarially determined using the
projected benefit method prorated on service and management's best estimate of
expected plan investment performance, salary escalation, retirement ages of
employees and health care costs.
For the purpose of calculating the expected return on plan assets, those
assets are valued at fair value.
Actuarial gains (losses) arise from the difference between actual long-term
rate of return on plan assets for that period and the expected long-term rate of
return of plan assets for that period or from changes in actuarial assumptions
used to determine the accrued benefit obligation. The excess of the net
actuarial gain (loss) over 10% of the greater of the accrued benefit obligation
and the fair value of plan assets is amortized over the average remaining
service period of active employees. The average remaining service periods are
summarized in Note 15. The transitional asset is amortized on a straight-line
basis over 16 years.Income and Mining TaxesThe Company uses the tax asset and liability method to recognize and measure
future income taxes. Under this method, future income tax assets and liabilities
are recognized for the tax consequences of temporary differences by applying
statutory tax rates applicable to future years to the difference between the
financial statement carrying amounts and the tax bases. Cambior records a
valuation allowance against any portion of these future income tax assets that
it believes will not more likely than not, be realized. Mining taxes represent
Canadian provincial taxes levied on mining operations and are classified as
income taxes since such taxes are based on a percentage of mining profits.Stock-based CompensationUnder its stock option plan, the Company grants common share purchase options
to directors and key employees of the Company. Stock-based compensation plans
are accounted for using the fair value-based method of accounting. Compensation
costs, measured at the grant date based on the fair value of the options and
recognized over the related service period, are accounted for as an expense in
the statement of operations and credited to contributed surplus. Consideration
paid by employees when the options are exercised, as well as the fair value at
the grant date of options exercised, are added to capital stock.Revenue RecognitionRevenues from gold, niobium and bauxite sales that represent more than 98.7%
(98.5% in 2004) of revenues from mining operations are recognized when the
following conditions are met:
Persuasive evidence of an arrangement exists;
  Delivery has occurred under the terms of the arrangement;
  The price is fixed or determinable; and
  Collection is reasonably assured.For gold sold under forward sales contracts or in the spot market, it is
considered that delivery has occurred on transfer of title to the gold to
counterparties.
For niobium and bauxite sold under specific contracts, it is considered that
delivery has occurred on transfer of the rights and obligations to buyers.
Revenues from contracting services are recognized as services are rendered.CAMBIOR 2005
    ANNUAL REPORT
    49Earnings (Loss) per ShareThe calculation of earnings (loss) per share is based upon the weighted
average number of shares outstanding each year. The treasury stock method is
used to determine the dilutive effect of stock options and warrants.ReclassificationCertain comparative figures have been reclassified to conform with the
presentation adopted in 2005.3. Changes in Accounting Policies

Stock-based CompensationOn January 1, 2004, the Company adopted, retroactively, without restating
prior periods, the amended recommendations of the Canadian Institute of
Chartered Accountants ("CICA") Handbook Section 3870, "Stock-based Compensation
and Other Stock-based Payments". These standards define a fair value-based
method of accounting and establish that compensation costs be measured at the
grant date based on the fair value of the options and recognized over the
related service period. These amendments require that the fair value-based
method be applied to options granted to employees, which previously had not been
accounted for at fair value. Before 2004, the Company did not use the fair value
method of accounting for its options granted to employees and provided in its
financial statements pro forma disclosures of net earnings and earnings per
share as if the fair value method of accounting had been applied.
The following table presents the impact of the previously-described changes
as at January 1, 2004:$Fair value of options granted
    from 1995 to 2003 applied to deficit
    15,873Fair value of options exercised from 1995 to 2003 transferred
    to common shares
    (212)Residual amount applied to contributed surplus
    15,661Asset Retirement ObligationsOn January 1, 2004, the Company adopted the recommendations of CICA Handbook
Section 3110, "Accounting for Asset Retirement Obligations" which establish
standards for recognition and measurement of a liability for an asset retirement
obligation and the associated asset retirement cost.
This change in accounting policy was applied retroactively and reflected in
the consolidated financial statements as follows:
2004
    2003$
    $Consolidated balance sheet:Increase in
    property, plant and equipment
    10,953
    5,440Increase in asset
    retirement obligations
    10,731
    3,358Increase in
    shareholders' equity
    222
    2,082Consolidated operations:Decrease in mining
    operations expenses
    387
    863Increase in depreciation, depletion
    and amortization
    991
    711Increase (Decrease) in net earnings
    (604)
    15250
    CAMBIOR 2005 ANNUAL REPORTNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)3. Changes in Accounting Policies (continued)

Flow-through SharesIn March 2004, the CICA Emerging Issues Committee ("EIC") issued EIC Abstract
146, "Flow-through shares", identifying two issues as a result of varying
practices related to the date of recognition of the future tax liability and the
recognition of previously unrecorded future income tax assets caused by the
renouncement of expenditures relating to flow-through shares. The future income
tax liability must be recognized, and the shareholders' equity reduced, on the
date that the Company renounces the tax credits associated with the
expenditures, provided there is reasonable assurance that the expenditures will
be made. Cambior adopted this pronouncement in 2004 which resulted in the
recognition of a future income tax liability of $1,219,000 offset by the
recognition of a corresponding amount of unrecognized tax losses incurred
previously.4. Impairment Loss and Restructuring CostsIn accordance with its accounting policies, the Company reviewed the carrying
value of the Doyon mine at year-end 2004 based on its long-term plan and updated
mineral reserves and determined that an impairment loss was necessary in 2004.
Net estimated future cash flows from the Doyon mine were calculated, on an
undiscounted basis, based on management's best estimates of future gold
production, which were established using long-term gold price and foreign
exchange rate assumptions. Future expected operating costs, capital expenditures
and asset retirement obligations were based on the life of the mine. The fair
value was calculated by discounting the estimated future net cash flows using a
single interest rate, commensurate with the risk.
The impairment loss also required the write-off of previously deferred losses
and the set-up of a hedge derivative loss for forward contracts attributable to
Doyon.
This loss is summarized as follows:
2004$Impairment loss
    52,645Write-off of deferred losses
    4,293Hedge derivative loss in relation with the fair value of
    forward sales commitments
    14,27371,211Restructuring costs
    1,94173,1525. Financial Information Included in the Consolidated Statement of Cash Flows(a) Changes in non-cash working capital items
2005
    2004
    2003$
    $
    $Receivables
    (7,667)
    (3,841)
    (711)Production inventories
    482
    (293)
    (2,667)Supplies inventory and prepaid expenses
    (5,117)
    (8,199)
    (1,312)Accounts payable and accrued liabilities
    (1,318)
    16,127
    4,044(13,620)
    3,794
    (646)Some changes in non-cash working capital items for major projects in
construction are included in investing activities. These are considered as
investing activities because they relate to the construction, or the
constitution of working capital prior to commercial production. When commercial
production begins, changes in non-cash working capital items are presented under
operating activities. Changes in non-cash working capital items related to
acquisition of assets are included in investing activities.CAMBIOR 2005
    ANNUAL REPORT
 

    51(b) Cash flows relating to interest and income and mining taxes

|                                        | 2005  | 2004  | 2003 
|--------------------------------------- | ----- | ----- | -----
|                                        | $     | $     | $    
|Interest paid                           | 3,273 | 2,500 | 1,343
|Income and mining taxes paid (received) | 247   | 451   | (361)

6. Cash and Short-term Investments

|                                                                                      | 2005   | 2004  
|------------------------------------------------------------------------------------- | ------ | ------
|                                                                                      | $      | $     
|Cash                                                                                  | 1,920  | 7,438 
|Short-term investments with initial
    maturities of less than three months, bearing |        |       
|interest at rates varying from 3.20%
    to 4.15% (2.10% to 2.45% in 2004)(a)         | 13,662 | 13,582
|Cash and cash equivalents                                                             | 15,582 | 21,020
|Short-term investments with initial
    maturities of more than three months but less |        |       
|than six months, bearing interest at
    rates varying from 2.02% to 2.48% in 2004(b) |       | 33,846
|Cash and short-term investments                                                       | 15,582 | 54,866

(a)

7. Investments and Other Assets

|                                                                                                 | 2005   | 2004  
|------------------------------------------------------------------------------------------------ | ------ | ------
|                                                                                                 | $      | $     
|Shares of publicly-traded companies, at cost
    net of provision for decline in market value(a) | 14,103 | 15,820
|Ounces of gold receivable related to the
    disposal of the Carlota project (Note 9)            | 24,850 |      
|Debt service accounts (Note 11 b) and c))                                                        | 812    |      
|Restricted cash deposit per closure cost
    guarantees (Note 14)                                | 533    |      
|Residual proceeds receivable of $2,000,000
    from the sale of a project, discounted at 6.125%  |       | 1,912 
|Promissory note receivable from a supplier
    and others                                        | 833    | 2,454 
|Accrued benefit asset (Note 15)                                                                  | 1,248  | 563   
|                                                                                                 | 42,379 | 20,749
|Deferred charges                                                                                 | 2,412  | 1,911 
|                                                                                                 | 44,791 | 22,660
|Current portion included in receivables                                                          | 13,358 | 1,912 
|                                                                                                 | 31,433 | 20,748



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52
    CAMBIOR 2005 ANNUAL REPORTNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
8. Property, Plant and Equipment

|                                                    |           |                 | 2005   
|--------------------------------------------------- | --------- | --------------- | -------
|                                                    |           | Accumulated     |        
|                                                    |           | depreciation,   |        
|                                                    |           | depletion and   |        
|                                                    | Cost      | amortization(1) | Net    
|                                                    | $         | $               | $      
|Mining properties                                   | 164,560   | 66,853          | 97,707 
|Development expenses(2)                             | 509,848   | 408,022         | 101,826
|Land, buildings and equipment relating to
    mines | 510,835   | 326,236         | 184,599
|Other                                               | 17,035    | 15,394          | 1,641  
|                                                    | 1,202,278 | 816,505         | 385,773
|Mining projects                                     | 69,093    |                | 69,093 
|                                                    | 1,271,371 | 816,505         | 454,866
|                                                    |           |                 |        
|                                                    |           |                 | 2004   
|                                                    |           | Accumulated     |        
|                                                    |           | depreciation,   |        
|                                                    |           | depletion and   |        
|                                                    | Cost      | amortization(1) | Net    
|                                                    | $         | $               | $      
|Mining properties                                   | 144,402   | 56,682          | 87,720 
|Development expenses(2)                             | 467,463   | 381,219         | 86,244 
|Land, buildings and equipment relating to
    mines | 446,367   | 295,385         | 150,982
|Other                                               | 14,583    | 13,005          | 1,578  
|                                                    | 1,072,815 | 746,291         | 326,524
|Mining projects(3)                                  | 86,958    | 14,635          | 72,323 
|                                                    | 1,159,773 | 760,926         | 398,847

(1)

(2)

(3) The costs of mining
projects include accumulated depreciation related to the transfer of equipment
between subsidiaries.

9. Acquisition and Disposition of Assets and Businesses

The following table presents the cash impact of acquisition and disposition
of assets and businesses:

|                                                                                            | 2005    | 2004     | 2003 
|------------------------------------------------------------------------------------------- | ------- | -------- | -----
|                                                                                            | $       | $        | $    
|Disposal of Carlota Project                                                                 | 14,299  |         |     
|Consolidation of the ownership of the
    Sleeping Giant mine                               | (4,136) |         |     
|Acquisition of Sequoia Minerals Inc.                                                        |        | (42,019) |     
|Privatization of Linden Bauxite operations in
    Guyana and creation of Omai Services Inc. |        | (14,711) |     
|Acquisition of Camp Caiman Project                                                          |        |         | 3,230
|                                                                                            | 10,163  | (56,730) | 3,230

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CAMBIOR 2005
    ANNUAL REPORT
 


    53Disposal of the Carlota Copper Project
On December 21, 2005, Cambior completed the sale of the Carlota
Copper project ("Carlota") through the transfer of all shares of Cambior USA,
Inc. ("Cambior USA") for an initial consideration of $38,630,000. Under the
terms of the agreement, Cambior received, at closing, a cash consideration of
$15,000,000, and will receive, commencing on March 31, 2006, eight quarterly
deliveries of 6,250 ounces of gold. The fair value of the ounces of gold
receivable was determined to be $23,630,000 based on forward prices at the
closing date and a 3.0% risk premium. As the gold spot price was $489 per ounce
on the closing date, Cambior recognized both a $24,450,000 gold receivable and a
related discount of $820,000. The gold receivable is revaluated at each balance
sheet date at the current spot price and the variation is accounted for under
the "non-hedge derivative gain" caption in the statement of operations (Note
21). The discount is amortized up to the time of deliveries and is accounted for
under the "investment income" caption in the statement of operations.
To conclude this transaction, Cambior incurred $1,001,000 of
commission and fees. The net gain on disposal was $12,552,000. The USA tax
losses carried forward of Cambior USA were also transferred to the buyer. Also
following this disposition, Cambior has realized, for income tax purposes, a
capital loss in the amount of $41,837,000 on which no future tax asset was
recognized.
At December 31, 2005, the revaluation of the gold receivable at
a spot price of $513 per ounce, resulted in the recognition of a $1,200,000
gain.
The final four gold deliveries may be deferred if the buyer is
unable to begin construction at Carlota by the first quarter of 2007. The
deferral cannot however be extended beyond June 30, 2010. Following an
agreed-upon drilling program of approximately 3,000 meters, Cambior may receive
up to an additional $4,000,000 in cash based on the estimated copper contained
in defined areas.
As security regarding the gold deliveries, the buyer:
(i) pledged all shares
of Cambior USA and of Carlota Copper Company ("CCC"), a wholly-owned subsidiary
of Cambior USA and the direct owner of Carlota; and
(ii) granted first
rank security interests in all moveables and immoveables of Cambior USA and of
CCC, in Cambior's favor; such first ranking being subject to existing royalties
on Carlota and security interests to be granted in connection with project
financing for Carlota, if and when applicable, which shall rank pari passu
with Cambior's security.
The carrying value of the Carlota project as at December 31,
2004, was classified as assets held for sale on the consolidated balance sheet.
All expenditures related to the Carlota project were capitalized and included in
investing activities: $2,125,000 in 2005, $5,888,000 in 2004 and $1,654,000 in
2003.
Consolidation of the Ownership of the Sleeping Giant Mine
Effective April 30, 2005, the Company purchased the remaining 50% interest in
the Sleeping Giant mine for a cash consideration of $4,136,000 (C$5,205,000).
The transaction was accounted as an acquisition of assets.
The following table summarizes the fair value of the assets acquired and
liabilities assumed at the date of acquisition.
$Current assets
    606Investments
    815Property, plant and equipment(1)
    6,041Total assets acquired
    7,462Current liabilities
    1,643Liability for asset retirement obligations
    and others
    1,643Assumption of long-term debt
    40Total liabilities assumed
    3,326Net assets acquired
    4,136ConsiderationNet disbursement
    4,136(1)Property, plant and equipment consist of mining properties, land,
buildings and equipment relating to mines.

---

54
    CAMBIOR 2005 ANNUAL REPORTNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
9. Acquisition and Disposition of Assets and Businesses
(continued)

Acquisition of Sequoia Minerals Inc.On July 2, 2004, Cambior acquired Sequoia Minerals Inc. ("Sequoia") through a
merger transaction, thereby consolidating the ownership of the Niobec mine.
Sequoia held a 50% interest in the Niobec mine and was the mine operator.
Cambior purchased the remaining interest for $42,019,000 in cash and issued
2,241,000 of its shares valued at $6,292,000. This value was determined based on
an exchange ratio of one Cambior share for each 6.3 Sequoia shares.
The transaction with Sequoia was accounted as a business combination using
the purchase method of accounting. Cambior estimated a liability for asset
retirement obligations relating to the closure of a non-strategic division.
Cambior also accounted for a provision of $422,000 for involuntary termination
benefit expenses.
As the acquired company was liquidated into Cambior on January 1, 2005, the
future income tax assets previously considered in Sequoia's financial statements
were re-evaluated based on its estimated profit for the period preceding the
liquidation. No future tax liability was recorded with respect to the excess of
purchase price paid over book value as it was assumed that, as a result of the
acquisition, such future liability would be settled against some of Cambior's
not-yet recorded future tax assets. However, a future mining duties liability of
$589,000 was recorded to reflect the higher values for accounting than for
mining duties existing in Sequoia at the time of acquisition. The initial
allocation of the purchase price was adjusted in 2005.
The following table summarizes the adjusted value of the assets acquired and
the liabilities assumed at the date of acquisition:

|                                                                                       | $     
|-------------------------------------------------------------------------------------- | ------
|Current assets                                                                         | 12,999
|Investments                                                                            | 153   
|Property, plant and equipment                                                          | 58,227
|Future income tax assets                                                               | 41    
|Total assets acquired                                                                  | 71,420
|                                                                                       |       
|Current liabilities                                                                    | 4,981 
|Assumption of long-term debt                                                           | 14,061
|Assumption of debentures                                                               | 1,015 
|Asset retirement obligations                                                           | 822   
|Accrued benefit liability(1)                                                           | 1,369 
|Future mining tax liabilities                                                          | 589   
|Total liabilities assumed                                                              | 22,837
|Net assets acquired                                                                    | 48,583
|                                                                                       |       
|Consideration                                                                          |       
|Disbursement(2)                                                                        | 42,019
|Issuance of Cambior
    shares                                                         | 6,292 
|Conversion option on
    convertible debenture                                         | 262   
|Fair value of Sequoia common share
    purchase options converted into Cambior options | 10    
|                                                                                       | 48,583

(1)

(2)

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CAMBIOR 2005
    ANNUAL REPORT
 


    55Privatization of Linden Bauxite Operations in GuyanaIn December 2004, Cambior completed a transaction with the Government of
Guyana for the privatization of certain assets of Linden Mining Enterprise
Limited (Linmine), a bauxite mining and processing operation wholly-owned by the
Government of Guyana.
A new company, OMAI Bauxite Mining Inc. (OBMI), has been incorporated and is
owned 70% by Cambior and 30% by the Government of Guyana. The main privatized
assets contributed by the Government of Guyana are the processing plant along
with service facilities and the Montgomery mine totalling $5,223,000. Cambior
contributed an amount of $12,187,000 to acquire its 70% participation including
$5,000,000 cash and the balance in mine equipment transfers from OMAI Gold Mines
Ltd. (OGML).
This transaction also included the creation of Omai Services Inc. (OSI), a
wholly-owned Cambior'subsidiary which was granted a licence to generate and sell
electricity to OBMI and another customer under a 15-year agreement.Camp Caiman ProjectOn November 29, 2003, the Company acquired the Camp Caiman advanced gold
exploration project located in French Guiana, South America, and other assets
and liabilities through a merger agreement with Ariane Gold Corp. ("Ariane").
The transaction with Ariane was accounted as an acquisition of assets.
Under the terms of the agreement, Cambior issued 14,834,621 common shares to
Ariane shareholders valued at $2.64 (C$3.58) each, based on the closing prices
of the companies' respective shares on the Toronto Stock Exchange on the date
the transaction was announced. The Company also allowed the holders of 1,266,000
options issued under the Ariane employee option plan to obtain corresponding
options of Cambior (based on the relevant exchange ratio) and to hold them until
their original scheduled expiry.
The value of the net assets acquired has been established as follows:
$Cash and cash equivalents
    3,230Current assets
    186Investment(1)
    (396)Property, plant and equipment  mining projects
    49,615Total assets acquired
    52,635Current liabilities
    2,276Assumption of long-term debt
    9,711Total liabilities assumed
    11,987Net assets acquired
    40,648ConsiderationIssuance of Cambior
    shares
    39,203Fair value of Ariane common share
    purchase options converted into Cambior options(2)
    1,44540,648(1) Prior to the transaction,
the Company held a minority investment in shares of Ariane.

(2)

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56
    CAMBIOR 2005 ANNUAL REPORTNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
10. Current Portion of Long-term Liabilities

|                                 | Note | 2005   | 2004  
|-------------------------------- | ---- | ------ | ------
|                                 |      | $      | $     
|Current portion of:              |      |        |       
|Long-term debt                   | 11   | 21,222 | 20,787
|Deferred revenue                 | 12   |       | 12,222
|Deferred gains                   | 13   | 119    |      
|Asset retirement
    obligations | 14   | 1,895  | 3,754 
|Accrued benefit liabilities      | 15   | 406    | 105   
|                                 |      | 23,642 | 36,868

11. Long-term Debt

|                              | Total  | Scheduled payments | Total 
|----------------------------- | ------ | ------------------ | ------
|                              | 2005   | 2006               | 2007  
|                              | $      | $                  | $     
|2003 Credit facility(a)       | 32,000 | 14,000             | 14,000
|Balance of purchase price     |        |                    |       
|Rosebel(e)                    |       |                   |      
|Grassalco(f)                  | 1,503  | 816                | 687   
|Non-participating shares(g)   | 1,400  | 480                | 480   
|Convertible debenture(h)      | 1,256  | 1,256              |      
|Others                        | 938    | 175                | 365   
|Subtotal                      | 37,097 | 16,727             | 15,532
|Non-recourses debt            |        |                    |       
|Credit facility 
    OBMI(b) | 10,000 |                   | 626   
|Credit facility 
    OSI(c)  | 8,000  | 419                | 613   
|Balance of purchase           |        |                    |       
|price-Camp Caiman(d)          | 7,918  | 4,076              |      
|Subtotal                      | 25,918 | 4,495              | 1,239 
|Total                         | 63,015 | 21,222             | 16,771
|Current portion               | 21,222 |                    |       
|Long-term portion             | 41,793 |                    |       

(a) 2003 Credit Facility

On February 7, 2003, Cambior entered into a new Credit facility agreement
("2003 Credit facility") with a banking syndicate. The 2003 Credit facility
initially consisted of a non-revolving term loan and a revolving credit
facility.

In 2004, a Credit facility amendment to delay the reimbursement schedule by
nine months commencing March 31, 2005 was agreed upon. The new repayment
schedule consists of four quarterly payments of $3,500,000 in 2006, four
quarterly payments of $3,500,000 in 2007 and three quarterly payments of
$1,333,000 in 2008.

In October 2005, Cambior agreed to an amendment to its 2003 Credit facility
with its lenders to increase the revolving credit facility from $10,000,000 to
$15,000,000, and to change the basis for calculating interest rates and fees. In
accordance with this amendment, the interest margin above LIBOR rate will
henceforth vary according to the ratio of Total Net Senior Debt to EBITDA. The
Total Net Senior Debt is defined as the aggregate amount of the debt less cash
and subordinated debt. The EBITDA is defined as the consolidated net income plus
interest expense, depreciation, amortization expense and income tax expense.
Committed facilities carry a weighted average standby fee of 0.30% per annum on
the unutilized portion of the 2003 Credit facility.

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CAMBIOR 2005
    ANNUAL REPORT
57At December 31, 2005, the $15,000,000 revolving portion of the 2003 Credit
facility, maturing on September 30, 2008, was unutilized except for $6,701,000
in letters of credit issued to guarantee certain corporate obligations. Prior to
the 2005 amendment, the 2003 Credit facility bore interest at the LIBOR rate
plus 2.50%, until achievement of completion at the Rosebel project which
occurred in late 2004. From January 2005 until November 2005, the interest
margin above LIBOR varied from 1.50% to 2.25% based on the Loan Life Protection
Ratio ("LLPR"). The LLPR was defined as the ratio of the present value
(discounted at a rate of 8% per annum) of projected cash flow available for debt
service to the total net senior debt. As at December 31, 2005, the effective
interest rate was 5.87% (4.81% as at December 31, 2004).
The 2003 Credit facility is secured by the Company's interests in the Doyon,
Mouska, Sleeping Giant, Niobec and Rosebel mines, and is subject to various
covenants, financial ratios and prepayments in the event of future financings.(b) Credit Facility  OBMIIn 2004, OBMI entered into a $10,000,000 credit facility with a Caribbean
financial institution on a non-recourse basis, but subject to a $5,000,000
construction cost-overrun guaranty from Cambior. This facility has a 10-year
term and an interest rate of 10.5% per year and is used to refurbish the bauxite
processing plant and infrastructure. An amount of $10,000,000 was borrowed
during 2005. Interest only is to be paid monthly during the first two years.
Thereafter, the facility is to be reimbursed by 32 equal consecutive quarterly
payments including interest until 2015. This credit facility is secured by a
first debenture over the fixed and floating assets of OBMI, together with a
collateral mortgage over the properties and the buildings constructed thereon.
It is also secured by an assignment of the proceeds of the sales agreements.
OBMI must also maintain a debt service account in the amount of one principal
and interest payment.(c) Credit Facility  OSIAn amount of $8,000,000 was borrowed during 2005 from a Caribbean financial
institution at a rate of 10.5% per year, on a non-recourse basis to install a
power plant near OBMI's facilities. The facility is to be reimbursed by 36 equal
consecutive quarterly payments including interest commencing June 30, 2006,
until March 31, 2015. OSI has granted a fixed and floating charge over its
assets to the lender to secure the repayment of the principal sum. OSI must also
maintain a debt service account in the amount of one principal and interest
payment.(d) Balance of Purchase Price Payable for Camp Caiman ProjectPursuant to the acquisition of the Camp Caiman project, the Company assumed
the balance of the purchase price relating to Ariane's acquisition from Asarco
Incorporated, in August 2002, of Asarco Guyane Française S.A.R.L. ("AGF"). The
balance of purchase price is accounted for at its discounted value calculated
using an interest rate of 3%, without interest and payable as follows:
i) $4,136,800 on August 19, 2006;
and
ii) $4,136,800 within 120 days of
the commencement of commercial production planned in 2008.
An amount of $2,171,000 was paid in 2004. The balance of purchase price
payable is subject to prepayments in the case of a subsequent issuance of
equity. The AGF (renamed CBJ Caiman S.A.S.) shares have been pledged as security
against the future payments, and will be released upon the full reimbursement of
the debt.(e) Balance of Purchase Price  RosebelThe balance of the purchase price represented the last installment of
$1,000,000 paid in 2005.(f) Balance of Purchase Price  GrassalcoUpon receiving the Right of Exploitation for the Rosebel project in December
2002, an amount became payable to Grasshopper Aluminum Company N.V. ("Grassalco"),
a mining company owned by the Government of Suriname, in compensation for
exploration expenses incurred by Grassalco. This amount is payable in three
equal annual installments of $696,000, the first of which was paid in 2005. The
discounted value was calculated using an interest rate of 3.19%.

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58
    CAMBIOR 2005 ANNUAL REPORTNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)11. Long-term Debt (continued)

(g) Non-participating SharesThe Rosebel mine started commercial production on February 11, 2004. In
accordance with the Mineral Agreement between the Company and the Republic of
Suriname, the Company issued to the Government of Suriname, following the date
of the commercial production as defined, 5% of the participating capital stock
of Rosebel Gold Mines N.V. ("RGM"), and 2,000,000 non-participating shares
redeemable for $2,000,000. Non-participating shares totalling $480,000 were
redeemed in 2005 ($120,000 in 2004).(h) Convertible DebentureUpon the acquisition of Sequoia in July 2004, the Company assumed a
convertible debenture. This debenture is convertible anytime into 340,166 common
shares of the Company and partially convertible at the Company's option under
certain conditions. The debenture has a par value of C$1,500,000, bears interest
at 10% per annum payable on a quarterly basis, and matures in December 2006. The
effective interest rate was 13.5% at December 31, 2005. The fair value of the
conversion option associated with the convertible debenture is recorded as
"Equity component of convertible debenture" under shareholders' equity. The
accretion on the debenture is charged to earnings ratably to maturity.Interest:Interest on long-term debt was as follows:

|                           | 2005  | 2004  | 2003 
|-------------------------- | ----- | ----- | -----
|                           | $     | $     | $    
|Interest on long-term debt |       |       |      
|Expensed                   | 3,000 | 2,291 | 91   
|Capitalized                | 669   | 529   | 1,411
|                           | 3,669 | 2,820 | 1,502

12. Deferred Revenue

On January 12, 2001, Cambior entered into a $55,000,000 prepaid gold forward
sales agreement with a financial institution, whereby Cambior was committed to
deliver an aggregate of 233,637 ounces of gold in equal monthly deliveries from
July 2001 to December 2005. The cash proceeds from these prepaid sales were
accounted for as deferred revenue.

13. Deferred Gains (Losses)

|                                                                                                                         | 2005 | 2004   
|------------------------------------------------------------------------------------------------------------------------ | ---- | -------
|                                                                                                                         | $    | $      
|Deferred losses on gold related to hedging
    transactions                                                              | (85) | (5,134)
|Fair value at the date of conversion of non-hedge derivative
    instruments converted into hedge derivative instruments | 204  | 692    
|                                                                                                                         | 119  | (4,442)
|Current portion                                                                                                          | 119  | (4,646)
|Long-term portion                                                                                                        |     | 204    

---

CAMBIOR 2005
    ANNUAL REPORT
    5914. Liability for Asset Retirement Obligations and OthersCambior's activities are subject to various laws and regulations regarding
the environmental restoration and closure provisions for which the Company
estimates future costs. These provisions may be revised on the basis of
amendments to such laws and regulations and the availability of new information
such as changes in reserves corresponding to a change in the mine life or
construction of new mines. The liability for asset retirement obligations has
been considered in the yearend impairment test process. According to
management's estimate, the cash flows provided by Cambior's operations and
expected from the sale of residual equipment will be sufficient to meet the
payment obligations. The Company is required by the Minister of Natural
Resources in Québec to provide security pledges (government bonds or letter of
credit) based on the mine closure plans. As at December 31, 2005, the Company
had $533,000 in deposits restricted (Note 7) for settling its obligations as
well as a letter of credit in the amount of $500,000 issued to the Government of
Guyana. Asset retirement obligation settlements for OGML have started and will
continue in 2006.
At December 31, 2005, estimated undiscounted amounts of cash flows required
to settle the obligations, expected timing of payments and the average
credit-adjusted risk-free rate assumed in measuring the asset retirement
obligations were as follows:
Undiscounted
    Expected timing
    Average credit-adjustedamounts required
    of payments
    risk-free rate$Doyon mine
    30,294
    2007-2017
    5.30%Omai mine
    1,787
    2006
    6.92%Rosebel mine
    3,015
    2006-2021
    7.18%Sleeping Giant mine
    2,654
    2008-2012
    6.22%Niobec mine
    2,253
    2006-2025
    6.29%Bauxite mine
    2,675
    2065
    7.51%Other mines
    1,359
    2006-2009
    4.65% - 6.37%
  44,037The schedule of estimated future disbursements for rehabilitation and for
security deposits, is as follows:
$2006
    8,3652007
    5,2542008
    12,0802009
    4,9572010
    6,7482011 onwards
    6,100
  43,504

The following table presents the reconciliation of the liability for assets
retirement obligations:

|                                                                                                          | 2005    | 2004   
|--------------------------------------------------------------------------------------------------------- | ------- | -------
|                                                                                                          | $       | $      
|Liability for asset retirement obligations                                                                |         |        
|Balance, beginning
    of year as previously reported                                                     | 29,434  | 16,400 
|Prior years' adjustment to reflect
    the change in accounting for asset retirement obligations (Note 3) |        | 3,358  
|Restated balance, beginning of year                                                                       | 29,434  | 19,758 
|New obligation
    relating to the acquisition of assets and businesses                                   | 1,340   | 822    
|Revision in the
    estimated cash flows and timing of payments                                           | 4,855   | 5,673  
|Accretion expense                                                                                         | 1,832   | 1,787  
|Disbursements                                                                                             | (3,427) |       
|Foreign exchange variation                                                                                | 911     | 1,394  
|Balance, end of year                                                                                      | 34,945  | 29,434 
|Less current portion                                                                                      | (1,895) | (3,754)
|Long-term portion                                                                                         | 33,050  | 25,680 
|Other obligations                                                                                         | 755     | 279    
|                                                                                                          | 33,805  | 25,959 

---

60
    CAMBIOR 2005 ANNUAL REPORTNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)15. Employee Future Benefit PlansThe Company contributes to various defined contribution and final-pay defined
benefit pension plans for its employees that are funded on the basis of
actuarial valuations. The defined benefit pension plans are subject to funding
based on actuarial valuation which is performed at least every three years. The
most recent actuarial valuation was prepared as at January 1, 2003 and the next
required valuation will be as of January 1, 2006. The Company measures its
accrued benefit obligations and the fair value of plan assets for accounting
purposes as at December 31st of each year.
As well, senior management of the Company specifically designated by the
Board of Directors participate in a supplementary executive retirement plan ("SERP").
The purpose of the SERP is to provide these employees with a pension equal to
that which would otherwise be received if the Company's defined benefit pension
plan reflected the full amount of the base salary of such employees. Annual
contributions are assessed by the Board of Directors based on the Company's
financial position and other factors. In 2005, letters of credit amounting to
$6,201,000 (C$7,212,000) were issued to guarantee the SERP obligations under
retirement compensation agreements.
Upon the acquisition of Sequoia in July 2004, the Company assumed accrued
benefit liabilities relating to funded final-pay defined benefit pension plans
and other post-retirement benefit plans (health care plans). The Company also
recognized a new accrued benefit liability related to a post-retirement benefit
plan offered to unionized employees of Niobec. In 2005, the defined benefit
pension plan acquired was transferred to a company previously associated with
Sequoia. This transfer is presented as a settlement in the following
reconciliation. The post-retirement benefit plans are unfunded and require no
contribution from employees and the most recent actuarial valuations were
prepared in 2004.Total Cash PaymentsTotal cash payments for employee future benefits, consisting of cash
contributed by the Company to its funded pension plans, cash payments directly
to beneficiaries for its unfunded other benefit plans, and cash contributed to
defined contribution plans were $3,853,000 in 2005 ($3,077,000 in 2004).Defined Contribution PlansThe total expenses for the Company's defined contribution plans amounted to
$2,264,000 in 2005 ($2,306,000 in 2004 and $1,908,000 in 2003).CAMBIOR 2005
    ANNUAL REPORT
61Defined Benefit PlansPension benefit plans
    
    Post-retirement benefit plans2005
    2004
    
    2005
    2004$
    $
    
    $
    $Accrued benefit obligationsBalance, beginning of year
    12,247
    7,776
    
    2,362
    473Current service cost
    783
    534
    
    104
    354Interest expense
    735
    589
    
    176
    84Actuarial loss
    1,553
    684
    
    793
    180Benefits paid
    (306)
    (166)
    
    (100)
    (55)Acquisition of Sequoia
    (77)
    1,838
    
    
    1,096Settlement of a plan
    (972)
    
    
    
    Foreign exchange variation
    471
    992
    
    120
    230Balance, end of year
    14,434
    12,247
    
    3,455
    2,362
  Plan assetsFair value, beginning of year
    8,681
    5,377
    
    
    Actual return on plan assets
    912
    554
    
    
    Employer contributions
    1,589
    716
    
    
    Benefits paid
    (306)
    (166)
    
    
    Acquisition of Sequoia
    
    1,488
    
    
    Settlement of a plan
    (983)
    
    
    
    Foreign exchange variation
    342
    712
    
    
    Fair value, end of year
    10,235
    8,681
    
    
    
  Pension plan assets consist of:
    2005
    2004Asset category:
    %
    %Equity securities
    57
    52Debt securities
    33
    36Other
    10
    12Total
    100
    100Reconciliation of the funded status of the benefit plans to the amounts
recorded in the financial statements is as follows:
Pension benefit plans
    
    Post-retirement benefit plans2005
    2004
    
    2005
    2004$
    $
    
    $
    $Fair value of plan assets
    10,235
    8,681
    
    
    Accrued benefit obligations
    14,434
    12,247
    
    3,455
    2,362Funded status-deficit(1)
    (4,199)
    (3,566)
    
    (3,455)
    (2,362)Unamortized transitional asset
    (1,334)
    (1,420)
    
    
    Unamortized net actuarial loss
    3,189
    1,964
    
    997
    204Accrued benefit liabilities
    (2,344)
    (3,022)
    
    (2,458)
    (2,158)
(1) As at December 31, 2005,
the two final-pay defined benefit pension plans showed a deficit. As at December
31, 2004, two of the three final-pay defined benefit pension plans were showing
a deficit consisting of an accrued benefit obligation totalling $5,989,000 and
plan assets of $2,246,000.

---

62
    CAMBIOR 2005 ANNUAL REPORTNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)15. Employee Future Benefit Plans (continued)

Defined Benefit Plans (continued)

The accrued benefit liabilities are included in the Company's balance sheet
as follows:

|                                                                                       | Pension benefit plans | Post-retirement benefit plans | Total  
|-------------------------------------------------------------------------------------- | --------------------- | ----------------------------- | -------
|                                                                                       | 2005                  | 2004                          | 2005   
|                                                                                       | $                     | $                             | $      
|Accrued benefit asset                                                                  | 1,248                 | 563                           |       
|Current portion of long-term liabilities                                               | (250)                 | (105)                         | (156)  
|Accrued benefit liabilities                                                            | (3,342)               | (3,480)                       | (2,302)
|                                                                                       | (2,344)               | (3,022)                       | (2,458)
|                                                                                       |                       |                               |        
|There is no additional minimum
    liability as defined under US GAAP.                 |                       |                               |        
|                                                                                       |                       |                               |        
|The total costs recognized for
    the Company's defined benefit plans are as follows: |                       |                               |        
|                                                                                       | Pension benefit plans | Post-retirement benefit plans
|                                                                                       | 2005                  | 2004                          | 2003   
|                                                                                       | $                     | $                             | $      
|Current service cost                                                                   | 783                   | 534                           | 436    
|Interest expense                                                                       | 735                   | 589                           | 439    
|Actual return on plan assets                                                           | (912)                 | (554)                         | (392)  
|Actuarial loss                                                                         | 1,553                 | 684                           | 105    
|Element of employee future benefit costs before                                        |                       |                               |        
|adjustments to
    recognize the long-term nature                                      |                       |                               |        
|of employee future
    benefit costs                                                   | 2,159                 | 1,253                         | 588    
|Adjustments to recognize the long-term nature                                          |                       |                               |        
|of employee future
    benefit costs:                                                  |                       |                               |        
|Difference between
    expected return and actual return                               |                       |                               |        
|on plan assets for the year                                                            | 344                   | 126                           | 108    
|Difference between
    actuarial loss recognized                                       |                       |                               |        
|for the year and actuarial loss/gain on accrued                                        |                       |                               |        
|benefit obligations for the year                                                       | (1,455)               | (627)                         | (55)   
|Amortization of the transitional
    asset                                             | (129)                 | (120)                         | (111)  
|Defined benefit costs recognized                                                       | 919                   | 632                           | 530    

---



|CAMBIOR 2005
    ANNUAL REPORT | 63
|------------------------------ | --

The significant assumptions used to evaluate the Company's accrued benefit
obligations and benefit costs are as follows (weighted-average):

|                                                                         | Pension benefit plans | Post-retirement benefit plans
|------------------------------------------------------------------------ | --------------------- | -----------------------------
|                                                                         | 2005                  | 2004                         
|                                                                         | %                     | %                            
|Accrued benefit obligations as of December
    31:                       |                       |                              
|Discount rate                                                            | 5.3                   | 6.0                          
|Rate of compensation
    increase                                        | 3.0                   | 3.2                          
|Benefit costs for years ended December 31:                               |                       |                              
|Discount rate                                                            | 6.0                   | 6.4                          
|Expected long-term
    rate of return on plan assets                     | 7.0                   | 6.8                          
|Rate of compensation
    increase                                        | 3.2                   | 3.2                          
|Assumed health care
    trend rate for the next year used to measure     |                       |                              
|the expected cost covered by the plans                                   |                       |                              
|- first four years (first three years in 2004)                           |                      |                             
|- thereafter                                                             |                      |                             
|                                                                         |                       |                              
|                                                                         | 2005                  | 2004                         
|Average remaining service period of active employees covered
    by the: | Years                 | Years                        
|Defined pension
    benefit plan                                         | 16                    | 16                           
|SERP                                                                     | 11                    | 11                           
|Defined pension
    benefit plan  Sequoia                               |                      | 16                           
|Defined
    post-retirement benefit plan                                |                       |                              
|- manager and clerical employees at Niobec                               | 14                    | 10                           
|- unionized employees at Niobec                                          | 16                    | 16                           

The estimated employer contributions for 2006 are $963,000. Estimated benefit
payments for the next ten years are as follows:

|             | $    
|------------ | -----
|2006         | 463  
|2007         | 509  
|2008         | 543  
|2009         | 531  
|2010         | 535  
|2011 to 2015 | 4,505
|             | 7,086

Sensitivity analysis:

Assumed health care cost trend rates have a significant effect on the amounts
reported for the health care plans. A one percentage point change in assumed
health care cost trend rates would have the following effects for 2005:

|                                 | Increase | Decrease
|-------------------------------- | -------- | --------
|                                 | $        | $       
|Total service and interest costs | 15       | (16)    
|Accrued benefit liabilities      | 177      | (151)   

---

64
    CAMBIOR 2005 ANNUAL REPORTNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)16. Common Shares, Warrants and Options

Authorized

 Unlimited number of voting common
shares without par value.

 Unlimited number of Class I
preferred shares without par value, issuable in one or several series with
rights, privileges, restrictions and conditions to be determined by the Board of
Directors.

 10,000,000 Class II preferred
shares.

|                                                           | 2005          | 2004    | 2003         
|---------------------------------------------------------- | ------------- | ------- | -------------
|                                                           | Number        |         | Number       
|                                                           | of securities | Amount  | of securities
|                                                           | (000)         | $       | (000)        
|Common shares issued and fully paid:                       |               |         |              
|Balance, beginning of year                                 | 274,188       | 544,545 | 240,842      
|Options exercised from 1995 to 2003                        |               |        |              
|Options exercised during the year                          |               | 262     |              
|Issued:                                                    |               |         |              
|Public offerings                                           |              |        | 29,333       
|Merger agreement(1)                                        |              |        |             
|Acquisition of
    Sequoia(2)                              |              |        | 2,241        
|Exercise and expiry
    of warrants                        |              |        | 150          
|Exercise of options(3)                                     | 410           | 406     | 635          
|Flow-through common shares                                 |              |        | 987          
|                                                           | 410           | 668     | 33,346       
|Balance, end of year                                       | 274,598       | 545,213 | 274,188      
|                                                           |               |         |              
|Common share purchase warrants:(4)                         |               |         |              
|Balance, beginning of year                                 |              |        | 150          
|Exercised                                                  |              |        | (150)        
|Expired                                                    |              |        |             
|                                                           |              |        | (150)        
|Balance, end of year                                       |              |        |             
|                                                           |               |         |              
|Common share purchase options granted                      |               |         |              
|following the Ariane merger and Sequoia acquisition:(1)(2) |               |         |              
|Balance, beginning of year                                 | 873           | 953     | 1,012        
|Granted                                                    |              |        | 47           
|Exercised(3)                                               | (3)           | (4)     | (186)        
|Expired                                                    | (44)          | (6)     |             
|                                                           | (47)          | (10)    | (139)        
|Balance, end of year                                       | 826           | 943     | 873          
|Total common shares, warrants and options                  |               | 546,156 |              

(1)

(2) Upon the acquisition
of Sequoia (Note 9).

(3)The options were
exercised by employees of the Company under the stock option plan for directors
and key employees and pursuant to the merger agreement with Ariane.

(4) Excluding warrants
to purchase common shares that were issued as part of the August 12, 2003 and
October 14, 2004 public offerings.

---

CAMBIOR 2005
    ANNUAL REPORT
65Issuance of Securities2005:

Common shares were issued in 2005 following the exercise of common share
options.

2004:

On October 14, 2004, Cambior issued 29,333,333 units at a price of C$3.75 per
unit to a syndicate of underwriters for gross proceeds of $87,823,000
(C$110,000,000). Each unit consisted of one common share and one-half of one
Series D common share purchase warrant. Each whole Series D warrant is
exercisable at a price of C$4.35 before October 16, 2006. The net proceeds of
the offering were used by the Company for general corporate purposes.

In conjunction with the acquisition of Sequoia, the Company issued 2,241,000
common shares on July 2, 2004 (Note 9).

During 2004, 150,000 common shares at a price of C$0.56 per share were issued
pursuant to the exercise of warrants for total proceeds of $119,000.

In addition, pursuant to a flow-through financing to incur Canadian
Exploration Expenses, common shares were issued as follows during 2004:

|               | Number of common shares | Issuance price | Total proceeds
|-------------- | ----------------------- | -------------- | --------------
|               | (000)                   | ($ per share)  | $             
|March 18, 2004 | 111                     | $3.31 (C$4.40) | 367           
|April 16, 2004 | 571                     | $3.27 (C$4.40) | 1,868         
|July 12, 2004  | 305                     | $3.49 (C$4.60) | 1,064         
|               | 987                     |                | 3,299         

2003:

During 2003, 24,754,000 common shares were issued pursuant to the exercise of
warrants as follows:

|Number of common shares | Exercise price | Total proceeds
|----------------------- | -------------- | --------------
|(000)                   | ($ per share)  | $             
|10,417                  | $1.14 (C$1.70) | 11,834        
|107                     | $0.85 (C$1.30) | 123           
|596                     | $0.41 (C$0.56) | 444           
|13,634                  | $2.28 (C$3.00) | 31,617(1)     
|24,754                  |                | 44,018        









(1)

On August 12, 2003, Cambior issued to a syndicate of
underwriters, 40,000,000 units at a price of $1.80 (C$2.50) per unit for gross
proceeds of $72,192,000 (C$100,000,000). Each unit consisted of one common share
and one-half of one Series C common share purchase warrant. Each whole Series C
warrant is exercisable at a price of C$3.75 prior to August 12, 2008.

On September 2, 2003, 571,000 common shares were issued at a
price of $2.52 (C$3.50) pursuant a flow-through financing for total proceeds of
$1,441,000 (C$2,000,000) to incur Canadian Exploration Expenses.

Warrants

As at December 31, 2005, the outstanding number of warrants exercisable into
common shares was as follows:

|Date of issue    | Expiry date     | Exercise price | Number issued | Number exercisable
|---------------- | --------------- | -------------- | ------------- | ------------------
|                 |                 | $ per share    | (000)         | (000)             
|August 12, 2003  | August 12, 2008 | C$3.75         | 20,000        | 20,000            
|October 14, 2004 | October 16,2006 | C$4.35         | 14,667        | 14,667            
|                 |                 |                |               | 34,667            

---

66
    CAMBIOR 2005 ANNUAL REPORTNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)16. Common Shares, Warrants and Options (continued)

Shareholder Rights Plan

On November 4, 2005, the board of Directors adopted a Shareholder Rights Plan
(the "Plan") to encourage the fair treatment of shareholders should a take-over
bid be made for Cambior. Shareholders will vote on a resolution to ratify the
adoption of the Plan at an Annual and Special Meeting of the Shareholders which
will be held on or before May 4, 2006. If the resolution is not approved by a
majority of votes cast by Shareholders, the Plan and the rights issued under the
Plan will terminate and cease to be effective.

The rights issued under the Plan will become exercisable only if a person,
including any party related to it, acquires or announces its intention to
acquire 20% or more of the outstanding shares of Cambior without complying with
the "Permitted Bid" provisions of the Plan or without approval of the Board.

Earnings per Share

The following number of equity instruments were not included in the
computation of diluted earnings per share because to do so would have been
anti-dilutive for the periods presented.

|Number of instruments                                                                                                             | 2005    | 2004    | 2003   
|--------------------------------------------------------------------------------------------------------------------------------- | ------- | ------- | -------
|                                                                                                                                  | (000)   | (000)   | (000)  
|Options                                                                                                                           | 2,241   | 7,964   | 1,625  
|Warrants                                                                                                                          | 34,667  | 34,667  |       
|Convertible debenture                                                                                                             | 340     | 340     |       
|                                                                                                                                  | 37,248  | 42,971  | 1,625  
|                                                                                                                                  |         |         |        
|Reconciliation of the diluted
    weighted average number of common shares outstanding for the following years
    is as follows:
|                                                                                                                                  |         |         |        
|Number of instruments                                                                                                             | 2005    | 2004    | 2003   
|                                                                                                                                  | (000)   | (000)   | (000)  
|Basic weighted average number of common
    shares outstanding                                                                    | 274,339 | 249,321 | 187,953
|Effect of dilutive stock options                                                                                                  | 1,551   |        | 2,054  
|Effect of dilutive warrants                                                                                                       |        |        | 570    
|Diluted weighted average number of common shares outstanding                                                                      | 275,890 | 249,321 | 190,577

17. Common Share Purchase Options and Stock-based Compensation

Under the stock option plan for directors and key employees of the Company,
options may be granted to eligible employees. Options expire seven years after
the date of granting. Once granted, one half of the options may be exercised
from the second anniversary date of the granting and the balance after the third
anniversary thereof. Options are granted at an exercise price equal to the
average quoted (close) market price of the common shares of the Company on the
Toronto Stock Exchange for the five trading days immediately preceding the grant
date.

---



|CAMBIOR 2005
    ANNUAL REPORT | 67
|------------------------------ | --

The following table sets out the activity in options:

|                                        | 2005    | 2004      | 2003  
|--------------------------------------- | ------- | --------- | ------
|                                        |         | Weighted  |       
|                                        |         | average   |       
|                                        |         | price per |       
|                                        | Number  | option    | Number
|                                        | (000)   | $/option  | (000) 
|Common shares reserved(1)               | 13,730  |           | 9,000 
|Options outstanding, beginning of year  | 7,964   | 2.50      | 7,254 
|Granted                                 | 1,690   | 1.85      | 1,730 
|Granted following acquisition/merger(2) |        |          | 47    
|Exercised                               | (410)   | 0.99      | (635) 
|Forfeited or expired                    | (1,023) | 5.99      | (432) 
|Options outstanding, end of year        | 8,221   | 2.09      | 7,964 
|Options exercisable, end of year        | 4,589   |           | 4,554 

(1)

(2)Upon
the acquisition of Sequoia in 2004 and the merger agreement with Ariane in 2003
(Note 9), the then outstanding options were converted into Cambior options.

The following stock options were outstanding at December 31, 2005, including
the options resulting from the acquisition of Sequoia and the merger agreement
with Ariane:

|                  | Options outstanding | Exercisable options
|----------------- | ------------------- | -------------------
|                  |                     |                    
|                  |                     | Weighted           
|                  |                     | average            
|Exercise price    | Number              | remaining life     
|($ per option)(1) | (000)               | (years)            
|0.44 to 0.71      | 888                 | 2.4                
|1.07 to 1.53      | 485                 | 1.5                
|1.68 to 2.36      | 4,660               | 4.5                
|2.79 to 3.06      | 1,492               | 5.4                
|3.61 to 4.88      | 696                 | 0.8                
|                  | 8,221               |                    

(1)

---

68
    CAMBIOR 2005 ANNUAL REPORTNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)17. Common Share Purchase Options and Stock-based Compensation (continued)

Accounting for Compensation Plans

Cambior adopted, retroactively, the amended recommendations
of the CICA Section 3870, as of January 1, 2004.

The fair value of options
granted was estimated using the Black-Scholes option-pricing model taking into
account an expected life of five years and the following assumptions:

|                                    | 2005  | 2004  | 2003 
|----------------------------------- | ----- | ----- | -----
|Semi-annual risk-free interest rate | 3.50% | 3.95% | 4.08%
|Volatility                          | 65%   | 75%   | 78%  
|Dividend                            |      |      |     

The weighted average fair value of options granted in 2005 was $1.00 ($1.44
in 2004 and $0.93 in 2003). In 2005, the total stock-based compensation expense
determined under the fair value-based method was $1,595,000 ($1,580,000 in
2004). The fair value of options exercised during 2005 totalling $262,000
($202,000 in 2004) was transferred from contributed surplus to common shares.

Before 2004, the Company measured compensation costs relating to awards of
stock options using the intrinsic value-based method of accounting, and was
required to make pro forma disclosures of net earnings (loss), basic earnings
(loss) per share and diluted earnings (loss) per share as if the fair
value-based method of accounting had been applied, which would have been
reported as follows:

|                                                                                                                    | 2003   
|------------------------------------------------------------------------------------------------------------------- | -------
|                                                                                                                    | $      
|Net earnings                                                                                                        | 801    
|Deduct: Total stock-based employee compensation expense
    determined under fair value-based method for all awards | (1,065)
|Pro forma net loss                                                                                                  | (264)  
|Basic net earnings per share                                                                                        | 0.00   
|Diluted net earnings per share                                                                                      | 0.00   
|Basic net loss per share, pro forma                                                                                 | (0.00) 
|Diluted net loss per share, pro forma                                                                               | (0.00) 

Share Purchase Plan

The Company has an employee share purchase plan under which eligible
employees have the opportunity to acquire common shares of Cambior through
payroll deductions. The Company matches up to 50% of the employee contribution
up to the lesser of 3% of basic annual salary or C$5,000. The shares are
acquired on the open market by a trustee. Cambior's contribution is charged to
earnings in the year of contribution, and amounted to $547,000 in 2005, $489,000
in 2004 and $313,000 in 2003.

---

CAMBIOR 2005
    ANNUAL REPORT
6918. Fair Value of Financial Instruments

The following table presents the carrying amounts and estimated fair values
of Cambior's financial instruments and commodities:

|                                                                          | 2005     | 2004  
|------------------------------------------------------------------------- | -------- | ------
|                                                                          | Carrying | Fair  
|                                                                          | value    | value 
|                                                                          | $        | $     
|Financial assets                                                          |          |       
|Cash and cash equivalents(1)                                              | 15,582   | 15,582
|Short-term investments(1)                                                 |         |      
|Receivables excluding ounces of gold
    receivables(1)                   | 28,139   | 28,139
|Investments  Publicly-traded companies(2)                                | 14,103   | 20,703
|Ounces of gold receivable related to the sale
    of Carlota (Note 9)(3)  | 24,850   | 24,792
|Investments  Residual proceeds receivable(4)                             |         |      
|Debt service accounts, Cash deposit and
    promissory note and others(5) | 2,178    | 2,178 
|Fair value of non-hedge derivatives                                       | 1,082    | 1,082 
|Foreign exchange contracts (Note 21)(6)                                   |         | 42    
|                                                                          |          |       
|Financial liabilities                                                     |          |       
|Accounts payable and accrued liabilities(1)                               | 54,667   | 54,667
|Long-term debt(7)                                                         | 63,015   | 62,773
|Fair value of gold forwards (Note 21)(8)                                  | 13,529   | 33,999

(1)

(2)The
fair value of the shares of publicly-traded companies was based on the last
quoted market price.

(3) This
valuation is based on the forward price of gold as at year-end, the risk premium
and estimated delivery dates.

(4)The
fair value of the residual proceeds receivable from the sale of the El Pachon
project was equivalent to the carrying amount given the short-term maturity
period.

(5) The
fair value of the debt service accounts, the promissory note and others is
equivalent to the carrying amount given the short-term maturity period.

(6)The
Company obtains a valuation from a counterparty of its portfolio of foreign
exchange contracts. This valuation is based on forward premium considering
market foreign exchange rates.

(7) Since
most of the long-term debt is variable rate debt, the fair value of the
Company's long-term debt approximates the carrying amount as at December 31,
2005 and 2004.

(8)The
Company obtains a valuation from counterparty of its portfolio of gold
commitments. This valuation is based on forward rates considering the market
price, rate of interest, gold lease rate and volatility.

19. Cumulative Translation Adjustment

This account reflects the difference in the net value of the assets of the
Canadian mining operations relative to the US exchange rate in effect at the end
of each reporting period. The changes in this account are as follows:

|                                                                                 | 2005   | 2004   | 2003    
|-------------------------------------------------------------------------------- | ------ | ------ | --------
|                                                                                 | $      | $      | $       
|Cumulative unrealized gain (loss), beginning
    of year                         | 16,670 | 268    | (18,855)
|Unrealized net gain for the year on
    translation of net assets                | 5,337  | 16,402 | 19,123  
|Gain on foreign exchange accounted for in
    operations following the reduction |        |        |         
|in net investment in Canadian mining
    operations                              | (742)  |       |        
|Cumulative unrealized gain, end of year                                          | 21,265 | 16,670 | 268     
|Exchange rate, end of year                                                       | 1.1630 | 1.2020 | 1.2965  

---

70
    CAMBIOR 2005 ANNUAL REPORTNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)20. Income and Mining Taxes

The provision for income and mining taxes is different from the amount that
would have resulted from applying the combined Canadian statutory income tax
rate (federal and provincial: 35.01% in 2005, 36.0% in 2004 and 37.2% in 2003)
as a result of the following:

|                                                                                                            | 2005       | 2004     | 2003   
|----------------------------------------------------------------------------------------------------------- | ---------- | -------- | -------
|                                                                                                            | $          | $        | $      
|Income taxes (Income tax benefit) at combined
    Canadian statutory rate (federal and provincial)          | 10,879     | (24,138) | 92     
|Increase (Decrease) resulting from:                                                                         |            |          |        
|Resource allowance
    and earned depletion                                                                 | (463)      | 671      | (742)  
|Non-taxable portion
    of gain                                                                             | (98)       |         | (425)  
|Income tax rate
    differential of foreign subsidiaries                                                    | 600        | 727      | 302    
|Use of tax benefits
    not previously recognized                                                           |           | (5,066)  | (1,892)
|Future income tax
    recovery resulting from recognition of Rosebel prior years' tax assets                | (2,344)    | (4,008)  |       
|Tax treatment of the
    disposal of Carlota including realization of a capital loss                        | (19,802)   |         |       
|Impact of
    non-deductible (non-taxable) portion of foreign exchange loss (gain) on
    Canadian currency | (579)      | 741      | (2,560)
|Non-deductible items
    and other elements                                                                 | 2,983      | 963      | 124    
|Increase in valuation allowance                                                                             | 22,381     | 35,814   | 5,101  
|                                                                                                            | 13,557     | 5,704    |       
|Tax on large corporations                                                                                   | 86         | 242      | 293    
|Provincial mining taxes (recovery)                                                                          | (3,682)(1) | 214      | (712)  
|Other countries' current taxes (recovery)                                                                   |           |         | (135)  
|                                                                                                            | 9,961      | 6,160    | (554)  
|(1)This recovery
    reflects the reversal of $2,177,000 of mining taxes valuation allowance.               |            |          |        
|                                                                                                            |            |          |        
|The provision for income and mining taxes is
    made up of the following components:                       |            |          |        
|                                                                                                            | 2005       | 2004     | 2003   
|                                                                                                            | $          | $        | $      
|Current:                                                                                                    |            |          |        
|Federal income taxes  tax on large
    corporations in Canada                                              | 86         | 242      | 293    
|Provincial mining taxes (recovery)                                                                          | (2,089)    | 214      | (712)  
|Other countries' current taxes (recovery)                                                                   |           |         | (135)  
|                                                                                                            | (2,003)    | 456      | (554)  
|Future:                                                                                                     |            |          |        
|Provincial mining taxes (recovery)                                                                          | (1,593)    |         |       
|Federal and provincial income tax (recovery)                                                                |           | (1,180)  |       
|Foreign income tax                                                                                          | 13,557     | 6,884    |       
|                                                                                                            | 11,964     | 5,704    |       
|Total                                                                                                       | 9,961      | 6,160    | (554)  

---



|CAMBIOR 2005
    ANNUAL REPORT | 71
|------------------------------ | --

As a result of higher asset values for income tax purposes than accounting
values and accumulated losses in Canada, Guyana and in USA, the Company has
significant future tax assets available. Some of these assets were utilized as
part of the Sequoia acquisition in 2004 (Note 9). The Company records a
valuation allowance against any portion of its remaining future income tax
assets that it believes will not, more likely than not, be realized.

As at December 31, 2005 and 2004, future tax assets and liabilities were
detailed as follows:

|                                                      | 2005      | 2004        
|----------------------------------------------------- | --------- | ------------
|                                                      | Canada    | US and other
|                                                      | $         | $           
|Tax assets:                                           |           |             
|Future mining taxes                                   | 2,211     |            
|Net operating loss carry-forwards                     | 2,607     | 43,271      
|Net capital losses carry-forwards                     | 28,110    |            
|Difference between book                               |           |             
|and tax depreciation
    and depletion                | 116,189   | 18,818      
|Accrued liabilities                                   | 16,108    | 724         
|Others                                                | 4,595     |            
|Total of future tax assets before valuation allowance | 169,820   | 62,123      
|Valuation allowance                                   | (167,609) | (44,027)    
|                                                      | 2,211     | 18,096      
|Tax liabilities:                                      |           |             
|Difference between book and tax depreciation          |           |             
|and total of future tax liabilities                   | 1,310     | 38,536      

Cambior has approximately $182,202,000 ($147,059,000 in 2004) in cumulative
Canadian exploration and cumulative Canadian development expenses and
approximately $362,837,000 ($315,997,000 in 2004) in property, plant and
equipment depreciation for tax purposes available indefinitely to reduce taxable
income in future years. The Company also benefits from unclaimed investment tax
credits totalling $1,000,000, which can be converted into other deductions
anytime.

In 2005, governmental assistance in the form of the Québec resources tax
credit reduced exploration expenses by an amount of $2,239,000 ($2,049,000 in
2004).

---

72
    CAMBIOR 2005 ANNUAL REPORTNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)20. Income and Mining Taxes (continued)

Losses carried forward as at December 31, 2005 will expire as follows:

|                |             |         | Canada     | United States | Peru(3)
|--------------- | ----------- | ------- | ---------- | ------------- | -------
|                |             |         | $          | $             | $      
|2006            |             |         |           | 1,056         |       
|2007            |             |         |           | 645           |       
|2008            |             |         | 1,192      | 1,638         |       
|2009            |             |         | 1,596      | 1,336         |       
|2010            |             |         | 322        | 1,634         |       
|2011            |             |         |           | 1,026         |       
|2012            |             |         |           | 1,280         |       
|2014            |             |         | 4,944      |              |       
|2018            |             |         |           | 1,713         |       
|2019            |             |         |           | 1,197         |       
|2020            |             |         |           | 132           |       
|2021            |             |         |           | 113           |       
|2022            |             |         |           | 19            |       
|Undetermined(4) |             |         |           |              | 5,772  
|                |             |         | 8,054      | 11,789        | 5,772  
|                |             |         |            |               |        
|                |             | Guyana  | Guyana     | Guyana        | Guyana 
|                | Suriname(1) | OGML(1) | OBCI(2)(4) | OBMI(2)       | OSI(2) 
|                | $           | $       | $          | $             | $      
|Unlimited(2)(3) | 48,333      | 55,185  | 690        | 1,122         | 147    

(1)

(2)

(3)
According to fiscal legislation in Peru, losses can be carried forward until the
end of the fourth year following the first year in which a fiscal profit is
realized (no fiscal profit has been realized to date).

(4) Omai
Bauxite Company Inc.

The Company's French subsidiaries, CBJ-France and CBJ-Caiman, benefit from an
income tax exemption plan for a term of ten years. Under those tax holiday
plans, certain commitments made to the French Tax Administration must be met.
The tax holidays are subject to re-assessment by the authorities.

21. Commitments and Contingencies

Gold Sales and Purchase Commitments

The Company's gold sales and purchase commitments as at December 31, 2005,
were as follows(1):

|                                                                                    | 2006 | 2007 | Total
|----------------------------------------------------------------------------------- | ---- | ---- | -----
|Total obligations  forwards                                                        |      |      |      
|Quantity (000 oz.)                                                                  | 119  | 56   | 175  
|Average price
    ($/oz.)                                                           | 325  | 350  | 333  
|                                                                                    |      |      |      
|Gold purchase                                                                       |      |      |      
|Quantity (000 oz.)                                                                  | (10) |     | (10) 
|Average price ($/oz.)                                                               | 406  |     | 406  
|Net obligations (000 oz.)                                                           | 109  | 56   | 165  
|                                                                                    |      |      |      
|Ounces of gold receivable related to the disposal of
    Carlota (Note 9) (000 oz.) | 25   | 25   | 50   

(1)

---



|CAMBIOR 2005
    ANNUAL REPORT | 73
|------------------------------ | --

The estimated fair value of Cambior's gold forward sales and purchase
commitments, calculated using forward rates considering market prices, interest
rate, gold lease rate and volatilities, is as follows:

|                                                                                                | 2005     | 2004    
|----------------------------------------------------------------------------------------------- | -------- | --------
|                                                                                                | $        | $       
|Hedge derivatives  Forwards                                                                    | (33,999) | (23,006)
|Non-hedge derivatives                                                                           | 1,082    | 1,549   
|Estimated mark-to market value                                                                  | (32,917) | (21,457)
|Recognized on the balance sheet:                                                                |          |         
|Forwards  Doyon future gold production
    included in the impairment loss in December 2004(1) | (13,529) | (14,273)
|Non-hedge derivatives                                                                           | 1,082    | 1,549   
|                                                                                                | (12,447) | (12,724)
|Off-balance sheet  net fair value of forwards                                                  | (20,470) | (8,733) 

(1)

The non-hedge derivative gain (loss) is summarized as follows:

|                                                                                             | 2005  | 2004    | 2003   
|-------------------------------------------------------------------------------------------- | ----- | ------- | -------
|                                                                                             | $     | $       | $      
|Variation of the fair value of the non-hedge
    derivative instruments during the year      | (467) | 9,339   | (1,428)
|Gain resulting from the variation in market
    prices of ounces of gold receivable          |       |         |        
|related to the
    disposal of the Carlota project (Note 9)                                  | 1,200 |        |       
|Gain resulting from lease rate swap contracts                                                |      | 1,497   | 3,105  
|Gain (Loss) arising from the exercise of call options sold
    and gold purchase commitments | 1,964 | (8,285) | (1,042)
|Non-hedge derivative gain                                                                    | 2,697 | 2,551   | 635    

Foreign Exchange Contracts

As at December 31, 2005, the Company had commitments, through foreign
exchange forward contracts, to deliver US$5,500,000 and obtain in exchange
Canadian dollars at an average rate of C$1,1709 in 2006. As at December 31,
2005, the fair value of these foreign exchange contracts was $42,000. This
amount was not accounted for in the consolidated statement of operations as the
Company's commitments to deliver US dollars in exchange for Canadian dollars are
treated as hedge instruments. The Company is exposed to currency risks as a
result of revenues derived from its Canadian operations.

Risk of Counterparties

Realization of the Company's hedging program is dependent upon the ability of
the counterparties to respect the terms of the contracts and the maintenance of
a liquid market. Cambior's counterparties in its hedging transactions are the
Company's lenders.

Credit Risk

In the normal course of business of non-gold operations, the Company performs
ongoing credit reviews of its customers and evaluates the credit worthiness of
all new customers. Except for the ounces of gold receivable following the
disposal of Carlota (Note 9), there is no existing single account receivable
that represents a substantial risk for the Company. An allowance for doubtful
accounts receivable is established while taking into account the specific credit
risk related to customers, historical trends and the economic situation.

---

74
    CAMBIOR 2005 ANNUAL REPORTNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)21. Commitments and Contingencies (continued)

Royalties

Production from some mining properties is subject to royalties based on
various methods of calculation summarized as follows:

|          |                                                                               | Royalties included in mining operations expenses
|--------- | ----------------------------------------------------------------------------- | ------------------------------------------------
|Mine      | Calculation                                                                   | 2005                                            
|          |                                                                               | $                                               
|Rosebel   | 2% in-kind royalty per ounce of gold
    production and price participation   |                                                 
|          | of 6.5% on the amount exceeding a market
    price of $425 per ounce          |                                                 
|          | when applicable, using for each calendar
    quarter the average of the       |                                                 
|          | market prices determined by the London
    Bullion Market, P.M. Fix.          | 3,148                                           
|          |                                                                               |                                                 
|          | 0.25% of all minerals produced at Rosebel
    payable to a charitable         |                                                 
|          | foundation for the purpose of promoting local
    development of natural      |                                                 
|          | resources within Suriname                                                     | 682                                             
|          |                                                                               |                                                 
|          | 10% of the excess, if any, of the average
    quarterly market price          |                                                 
|          | above $300 per ounce for gold production from
    the soft and transitional   |                                                 
|          | rock portions and above $350 per ounce from
    the hard rock portion         |                                                 
|          | of the Rosebel property, after commencement
    of commercial production      |                                                 
|          | and up to a maximum of 7,000,000 ounces
    produced                          | 4,773                                           
|          |                                                                               |                                                 
|Omai Gold | 5% in-kind royalty on mineral production
    payable to the Government        |                                                 
|          | of Guyana. Reduction of 1% if the gold price
    is lower than $280 per ounce | 2,147                                           
|          |                                                                               |                                                 
|Doyon     | 24.75% of any excess of the annual average
    market price over $375 per     |                                                 
|          | ounce of gold produced (1,275,000 remaining
    ounces of production          |                                                 
|          | at December 31, 2005)                                                         | 1,674                                           
|          |                                                                               |                                                 
|Mouska    | Two royalties of 0.2% and 2.0% respectively of gold
    production            | 546                                             
|Total     |                                                                               | 12,970                                          

The Company is also subject to other royalties for which no amount was paid
during 2005, 2004 and 2003:

Sleeping Giant: Two royalties representing 2% of gross operating profit for
one and 15% of net operating profit for the other.

Sequoia Minerals

As part of the acquisition of Sequoia, the Company has assumed the indemnity
and guarantees issued to the purchaser of a business sold in 2003, for a
ten-year term for environmental purposes, up to a maximum amount of C$1,750,000.

Other Commitments

As at December 31, 2005, the Company had commitments to complete facilities,
summarized as follows:

|       | $    
|------ | -----
|Niobec | 1,501
|OBMI   | 3,248
|Caiman | 707  
|       | 5,456

---

CAMBIOR 2005
    ANNUAL REPORT
75ClaimsOMAI

On May 29, 2003, a writ of summons was served on OMAI Gold Mines Limited ("OGML")
in connection with a class action in Guyana claiming total compensation of
approximately US$2 billion for damages allegedly caused by the Omai gold mine in
Guyana since 1995. The action was filed on behalf of the same group of people
that had previously filed actions without success in both Québec and Guyana.

Cambior and OGML consider this action as unfounded and frivolous and OGML is
contesting it vigorously.

Others

The Company is also subject to various claims, legal proceedings, potential
claims and complaints arising in the normal course of business. The Company is
also subject to the possibility of new income and mining tax assessments for
some years. The Company does not believe that unfavorable decisions in any
pending procedures or threat of procedures related to any future assessment or
any amount it might be required to pay will entail a material adverse effect on
the Company's financial condition.

22. Joint Ventures

The following accounts represent the Company's proportionate interest in the
joint ventures of the Sleeping Giant mine (50%) up to April 30, 2005 and of the
Niobec mine (50%) up to July 2, 2004 (Note 9).

|                              | 2005    | 2004     | 2003    
|----------------------------- | ------- | -------- | --------
|                              | $       | $        | $       
|Current assets                |        | 1,694    | 9,462   
|Property, plant and equipment |        | 10,504   | 25,014  
|Current liabilities           |        | (1,572)  | (3,678) 
|Other liabilities             |        | (1,686)  | (2,095) 
|                              |        | 8,940    | 28,703  
|Revenues                      | 3,796   | 24,687   | 33,704  
|Expenses                      | (4,359) | (22,616) | (26,305)
|Net earnings (loss)           | (563)   | 2,071    | 7,399   
|                              |         |          |         
|                              | $       | $        | $       
|Cash flow from (used in):     |         |          |         
|Operating activities          | 211     | 3,723    | 10,447  
|Investing activities          | (1,484) | (3,499)  | (6,156) 
|Financing activities          | (4)     | (11)     |        
|                              |         |          |         

---

76
    CAMBIOR 2005 ANNUAL REPORTNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)23. Segmented Information

The Company's operations are managed on a mine basis. The Company operates
four gold mines, a niobium operation and a bauxite operation. Camp Caiman in
French Guiana was acquired in November 2003 and is a development project.

|                                         |          |          |          |            |         | Camp     |            |         
|---------------------------------------- | -------- | -------- | -------- | ---------- | ------- | -------- | ---------- | --------
|                                         |          |          |          | Sleeping   | Niobec, | Caiman   | Corporate  |         
|                                         | Rosebel  | Omai     | Doyon    | Giant      | Bauxite | (French  | and        |         
|(Suriname)                               | (Guyana) | (Canada) | (Canada) | and others | Guiana) | projects | Total     
|                                         | $        | $        | $        | $          | $       | $        | $          | $       
|2005                                     |          |          |          |            |         |          |            |         
|Revenues  Mining operations             | 151,520  | 37,067   | 72,956   | 18,814     | 93,182  |         | (5,652)    | 367,887 
|Financial expenses                       | 10,034   | 210      | 108      | (7)        | 1,854   |         | (7,507)    | 4,692   
|Depreciation, depletion and amortization | 19,160   | 3,376    | 13,718   | 4,186      | 7,239   |         | 252        | 47,931  
|Income and mining taxes (recovery)       | 14,105   |         | (2,675)  | (514)      | (1,041) |         | 86         | 9,961   
|Earnings (Loss)                          | 26,673   | (8,764)  | 918      | (3,318)    | 2,752   | (363)    | (11,660)   | 6,238   
|Capital expenditures (disposals)         | 27,907   | (3,144)  | 8,588    | 7,810      | 35,999  | 6,248    | (7,720)(1) | 75,688  
|Property, plant and equipment            | 148,662  | 8,729    | 68,321   | 16,758     | 136,669 | 64,624   | 11,103     | 454,866 
|Assets                                   | 191,225  | 15,714   | 78,982   | 18,774     | 179,259 | 64,929   | 72,471     | 621,354 
|                                         |          |          |          |            |         |          |            |         
|2004                                     |          |          |          |            |         |          |            |         
|Revenues  Mining operations             | 109,448  | 80,870   | 53,138   | 11,749     | 44,739  |         | 37         | 299,981 
|Financial expenses                       | 9,466    | 378      | 10       | 34         | 436     | 2        | (6,209)    | 4,117   
|Depreciation, depletion and amortization | 18,745   | 8,903    | 14,191   | 2,126      | 2,733   |         | 239        | 46,937  
|Impairment loss and restructuring costs  |         |         | 73,152   |           |        |         |           | 73,152  
|Income and mining taxes (recovery)       | 6,845    |         |         |           | 404     |         | (1,089)    | 6,160   
|Earnings (Loss)                          | 21,971   | 3,382    | (92,871) | (427)      | 3,754   | (1,307)  | (8,516)    | (74,014)
|Capital expenditures (disposals)         | 41,869   | (3,020)  | 17,227   | 3,051      | 61,175  | 7,711    | 19,135(1)  | 147,148 
|Property, plant and equipment            | 140,880  | 14,160   | 66,035   | 10,504     | 105,396 | 58,257   | 3,615      | 398,847 
|Assets                                   | 184,166  | 36,004   | 73,251   | 12,198     | 136,460 | 58,747   | 89,588(2)  | 590,414 
|                                         |          |          |          |            |         |          |            |         
|2003                                     |          |          |          |            |         |          |            |         
|Revenues  Mining operations             |         | 83,062   | 71,392   | 11,235     | 24,935  |         | 245        | 190,869 
|Financial expenses                       |         | 1,529    | 9        | (4)        |        |         | 389        | 1,923   
|Depreciation, depletion and amortization |         | 9,936    | 15,825   | 1,785      | 861     |         | 327        | 28,734  
|Income and mining taxes (recovery)       |         |         | (570)    | (143)      |        |         | 159        | (554)   
|Earnings (Loss)                          | (137)    | 3,377    | (2,850)  | 956        | 6,635   | (8)      | (13,220)   | (5,247) 
|Capital expenditures (disposals)         | 91,083   | (1,535)  | 10,617   | 4,438      | 2,820   | (2,043)  | 2,851(1)   | 108,231 

(1)

(2)Includes assets held
for sale totalling $22,952,000 at December 31, 2004 related to discontinued
operations (Note 9).

Reconciliation of reportable operating divisional earnings (loss) to net
earnings (loss) for the year is as follows:

|                                                              | 2005     | 2004     | 2003    
|------------------------------------------------------------- | -------- | -------- | --------
|                                                              | $        | $        | $       
|Operating division earnings (loss)                            | 17,898   | (65,498) | 8 686   
|Corporate and projects loss                                   | (11,660) | (8,516)  | (13,376)
|                                                              | 6,238    | (74 014) | (4,693) 
|Investment and other income                                   | 598      | 937      | 2,997   
|Stock-based compensation                                      | (1,595)  | (1,580)  |        
|Gain (Loss) on foreign exchange                               | (98)     | (1,103)  | 1,862   
|Gain on disposal of assets                                    | 12,540   |         |        
|Non-hedge derivative gain                                     | 2,697    | 2,551    | 635     
|Gain on foreign exchange from reduction in
    net investment | 742      |         |        
|Non-controlling interest                                      | (920)    | (565)    |        
|Net earnings (loss)                                           | 20,202   | (73,774) | 801     

---

CAMBIOR 2005
    ANNUAL REPORT
77Geographic Information

|              | Revenues  mining operations | Property, plant and equipment
|------------- | ---------------------------- | -----------------------------
|              | 2005                         | 2004                         
|              | $                            | $                            
|Canada        | 137,541                      | 104,091                      
|Guyana        | 78,826                       | 86,442                       
|French Guiana |                             |                             
|Suriname      | 151,520                      | 109,448                      
|Others        |                             |                             
|              | 367,887                      | 299,981                      

24. Generally Accepted Accounting Principles in Canada and the United States

The consolidated financial statements have been prepared in accordance with
Canadian GAAP, which differ in certain material respects from those principles
and practices that the Company would have followed had its consolidated
financial statements been prepared in accordance with US GAAP.

A. Consolidated Financial Statements

The adjustments to comply with US GAAP would be as follows:

|Consolidated statement of operations                                                     | 2005     | 2004     | 2003          
|---------------------------------------------------------------------------------------- | -------- | -------- | --------------
|                                                                                         |          |          | Restated(j)(1)
|                                                                                         | $        | $        | $             
|Net earnings (loss) as per Canadian GAAP                                                 | 20,202   | (73,774) | 801           
|Impairment loss(a)                                                                       |         | 13,604   | -            
|Depreciation, depletion and amortization(b)                                              | 1,613    | 4,345    | 4,529         
|Exploration and development costs for mining
    properties(c)                           | (16,833) | (14,732) | (3,641)       
|Unrealized gain (loss) on forward exchange
    contracts(d)                              | (98)     | (565)    | (893)         
|Gain on foreign exchange from reduction in
    net investment(e)                         | (742)    |         |              
|Cumulative effect of change in accounting
    policy for asset retirement obligations(f) |         |         | 1,930         
|Gain on foreign exchange contracts 
    acquisition of businesses(g)                    |         | 1,137    |              
|Interest on accretion of the convertible
    debenture(h)                                | 42       | 22       |              
|Income and mining taxes(i)                                                               | 32       | (317)    | -            
|Stock-based compensation(j)                                                              | 35       |         | (1,065)       
|Interest income(m)                                                                       | 30       |         |              
|Non-hedge derivative gain(m)                                                             | 16       |         |              
|Gain on disposal of assets(r)                                                            | 10,449   |         |              
|Net earnings (loss) as per US GAAP                                                       | 14,746   | (70,280) | 1,661         
|Basic and diluted net earnings (loss) per share as per US
    GAAP                       | 0.05     | (0.28)   | 0.01          

(1)

---

78
    CAMBIOR 2005 ANNUAL REPORTNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)24. Generally Accepted Accounting Principles in Canada and the United States
(continued)

A. Consolidated Financial Statements (continued)

The consolidated balance sheet items, adjusted to comply with US GAAP, would
be as follows:

|                                          | December 31, 2005 | December 31, 2004
|----------------------------------------- | ----------------- | -----------------
|                                          | As per            |                  
|                                          | Canadian          |                  
|                                          | GAAP              | Adjustments      
|                                          | $                 | $                
|Assets                                    |                   |                  
|Current portion of deferred losses        |                  |                 
|Receivables                               | 41,497            | (585)            
|Investments and other assets              | 31,433            | 6,600            
|                                          |                   | (585)            
|Embedded derivative                       |                  | 1,216            
|Property, plant and equipment             | 454,866           | (28,279)         
|                                          |                   | 29,998           
|                                          |                   | (41,448)         
|                                          |                   | 1,137            
|                                          |                   | (175)            
|Assets held for sale                      |                  |                 
|                                          |                   |                  
|Liabilities                               |                   |                  
|Current portion of deferred gains         | 119               | (119)            
|Deferred gains                            |                  |                 
|Current portion of fair value             |                   |                  
|of hedge derivative                       | 9,463             | 14,276           
|Fair value of hedge derivatives           | 4,066             | 6,152            
|Convertible debenture                     | 1,256             | 34               
|Future income and mining tax liabilities  | 39,846            | (485)            
|                                          |                   |                  
|Shareholders' equity                      |                   |                  
|Common shares and options                 | 546,156           | (35,022)         
|                                          |                   | 6,753            
|                                          |                   | 770              
|                                          |                   |                  
|Equity component of convertible debenture | 262               | (262)            
|                                          |                   |                  
|Contributed surplus                       | 18,378            | 11,626           
|                                          |                   | 361,667          
|                                          |                   | (35)             
|                                          |                   |                  
|Deficit                                   | (184,341)         | (374,465)        
|                                          |                   |                  
|Changes in market value of investments    |                  | 6,600            
|Loss on hedge derivatives                 |                  | (20,309)         
|Cumulative translation adjustment         | 21,265            | 10,222           
|                                          |                   | (19,513)         
|                                          |                   | (11)             

---

CAMBIOR 2005
    ANNUAL REPORT
79(a) Impairment Loss

Periodic reviews of the carrying amount of the Company's property, plant and
equipment are performed in accordance with Canadian GAAP requirements which,
beginning in 2004, are similar to US GAAP requirements with respect to the
writedown of assets. The impact on net earnings (loss) in 2004 results from the
fact that the impaired assets had a lower net book value under US GAAP than
under Canadian GAAP.

In addition, under US GAAP, the impairment loss and restructuring costs for
the year 2004 would be included in the calculation of "earnings before the
undernoted items".

(b) Depreciation, Depletion and Amortization

The depreciation, depletion and amortization of mining assets for the years
2005, 2004 and 2003 was lower under US GAAP than under Canadian GAAP as a result
of writedowns accounted for in prior years for the related assets.

Under Canadian GAAP, certain components of tailing dam projects are amortized
over a period that reflects the anticipated project total construction costs and
total expected lifetime. Under US GAAP, such method is prohibited as only
historical costs and actual lifetime are to be considered in the computation of
amortization.

(c) Exploration and Development Costs for Mining Properties

Under Canadian GAAP, exploration and development costs incurred subsequent to
the date of establishing that a property has mineral resources which have the
potential of being economically recoverable are allocated to property, plant and
equipment under mining projects. Under the United States Securities and Exchange
Commission ("SEC") guidelines, all costs incurred before a commercially mineable
deposit is established, generally by completing a bankable feasibility study,
must be expensed as incurred and such property should be classified as an
exploration property.

In addition, evaluation costs related to deposits on existing operating
properties that are capitalized under Canadian GAAP are expensed as incurred
under SEC guidelines.

(d) Unrealized Gain (Loss) on Forward Exchange Contracts

Gains and losses on forward exchange contracts are charged to income in the
same period as the corresponding hedged item. Under US GAAP, for the years ended
December 31, 2001 and for the six-month period ended June 30, 2002, unrealized
gains (losses) were charged to income as they occurred. Since July 1, 2002, the
Company has designated foreign currency fixed forwards as cash flow hedges for
US GAAP purposes. Consequently, those contracts are marked to market and related
unrealized gains or losses are charged to other comprehensive income. Unrealized
gains and losses are included in revenues in the same period as the
corresponding hedged item.

(e) Gain on Foreign Exchange from Reduction in Net Investment

The Company has recognized an exchange gain as a result of
the reduction in the net investment in Canadian mining operations. Under US GAAP,
adjustments to the equity translation account are made only when there is a
reduction in ownership as a result of a sale of a portion of the ownership to a
third party.

(f) Asset Retirement Obligations

On January 1, 2004, for Canadian GAAP purposes, the Company adopted the
recommendations of CICA Section 3110. This change in accounting policy was
applied retroactively with restatement of the prior years' consolidated
financial statements. For US GAAP purposes, on January 1, 2003, the Company
adopted the provisions of SFAS 143, "Accounting for Asset Retirement
Obligations". Under such provisions, the cumulative effect of the change in
accounting principle must be included in the statement of operations during the
year of adoption of the accounting policy.

(g) Gain on Foreign Exchange Contracts  Acquisition of Businesses

Under Canadian GAAP, the disbursement for the acquisition of Sequoia in 2004,
denominated in Canadian dollars, was accounted for using the exchange rate fixed
by foreign exchange fixed forward contracts purchased by the Company to hedge
the foreign exchange risk related to the disbursement.

Under US GAAP, such hedging is not permitted. The disbursement must be
accounted for using the exchange rate at the date of the acquisition and a
foreign exchange gain must be recognized.

---

80
    CAMBIOR 2005 ANNUAL REPORTNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)24. Generally Accepted Accounting Principles in Canada and the United States
(continued)

A. Consolidated Financial Statements (continued)(h) Convertible Debenture

Under Canadian GAAP, the convertible debenture was divided into a liability
component and an equity component. The interest expense is calculated based on
the liability component using the effective interest rate.

Under US GAAP, the convertible debenture must be accounted for as a liability
at its par value and the interest expense must be calculated using the contract
interest rate.

(i) Income and Mining Taxes

For US GAAP purposes, income and mining taxes would be reduced by $32,000
($453,000 in 2004) to reflect the impact, on future income taxes, of the
increased amortization of the costs of the tailing dam projects.

Furthermore, the US GAAP treatment for the issuance of flow-through shares
differs from Canadian GAAP which resulted in an increase of $770,000 in 2004.

(j) Stock-based Compensation

On January 1, 2004, for Canadian GAAP purposes, the Company adopted the
recommendations of CICA Section 3870. This change in accounting policy was
applied retroactively without restating prior periods.

As described in "Changes in accounting policies under US GAAP", the Company
adopted the provisions of SFAS 123(R) "Share-Based Payment" using a modified
retrospective application.

Under US GAAP, this retrospective application requires the restatement of
prior years.

In addition, under US GAAP, the expense must be calculated by taking into
account the estimation of awards expected to vest which resulted in a decrease
of $35,000 in the stock-based compensation for 2005.

(k) Deferred Stripping Costs

As mentioned in Note 2 "Accounting policies", the Company deferred mining
costs associated with stripping activities in the case of an open-pit mine if
the actual ratio of total tonnes of material mined relative to gold production
in a given year was higher than the estimated average ratio for the life of the
mine. The Company charged to operations the amortization of deferred stripping
costs in the periods during which the actual ratio of total tonnes of material
mined was lower than the estimated average ratio for the life of the mine. This
accounting method results in the smoothing of these costs over the remaining
life of the mine. Instead of capitalizing these costs, some mining companies
expense them as incurred, which may result in a greater volatility in
period-to-period results of operations. In March 2005, the Emerging Issues Task
Force (EITF) of the FASB reached a consensus on EITF Issue 04-06, "Accounting
for Stripping Costs Incurred during Production in the Mining Industry," as
further discussed in section 24.C "Accounting pronouncements not yet
implemented". The consensus was that stripping costs incurred during the
production phase of a mine are variable production costs that should be included
in the cost of inventory produced during the period the stripping costs are
incurred. Had the Company followed a policy of expensing these costs as
incurred, as proposed by EITF 04-06, the reported mining operation expenses
would have been reduced by $4,754,000 in 2004 and by $5,740,000 in 2003.

---

CAMBIOR 2005
    ANNUAL REPORT
81(l) Long-term Investments

Investments in shares of public companies and debt securities are recorded at
cost, less any provision for decrease in value for an other-than-temporary
decline. Under US GAAP, the Company is required to account for investments
available-for-sale at fair value and to present the unrealized gains or losses
as a component of other comprehensive income under shareholders' equity.

(m) Gold Receivable

Under both Canadian and US GAAP, the fair value at closing, of the ounces of
gold receivable related to the sale of the Carlota project (Note 9) was
determined to be $23,630,000. Cambior recognized both a $24,450,000 gold
receivable and a related discount of $820,000. Under Canadian GAAP, the gold
receivable is revaluated at each balance sheet date at the current spot price
and the variation is accounted for under the "non-hedge derivative gain" caption
in the statement of operations. The discount is amortized up to the time of
deliveries and is accounted for under the "investment income" caption in the
statement of operations.

Under US GAAP, the ounces of gold receivable are considered a hybrid
instrument composed of a receivable host contract and an embedded derivative
that must be bifurcated from the host contract. The value of the embedded
derivative was zero at the closing of the transaction.

The host contract is accounted for as an interest-bearing receivable, with
accrued interest charged to operations. The embedded derivative is
marked-to-market at each balance sheet date with the variation charged to
operations under "non-hedge derivative gain or loss". Furthermore, the
receivable and the embedded derivative instrument should be presented separately
on the balance sheet.

(n) Gain (Loss) on Hedge Derivatives

As explained in the accounting policies section, the Company designated gold
forward contracts as cash flow hedges for US GAAP purposes. Furthermore, since
July 1, 2002, the Company has designated foreign exchange contracts as cash flow
hedges of Canadian sales denominated in US dollars. For US GAAP purposes, those
contracts are marked-to-market and related unrealized gains or losses are
charged to other comprehensive income until the hedged production is delivered.
Upon delivery, the gain or loss on the hedging contract that has been deferred
in other comprehensive income is transferred to revenues in the consolidated
statement of operations. When the Company delivers gold production against such
contracts at a date earlier than anticipated or liquidates the contract before
such anticipated date, the gain or loss continues to be deferred in other
comprehensive income and is transferred to revenues in the period of the
corresponding hedged item's original designation date. If the Company delivers
gold production against such contracts at a date later than anticipated, the
Company transfers the related gain or loss to revenues on the original
designation date.

(o) Share Issue Expenses

Share issue expenses are shown as an increase to the deficit as provided for
under Canadian GAAP. Under US GAAP, these expenses must be shown as a reduction
of capital stock.

(p) Change in Reporting Currency

The Company adopted the US dollar as its reporting currency
effective January 1, 1996. Under US GAAP, prior years' financial statements must
be translated using the current rate method, using the year-end rate or the rate
in effect at the transaction dates, as appropriate. This translation approach
was applied retroactively.

(q) Elimination of the Deficit

On May 7, 2002, the Company's shareholders adopted a resolution to apply
amounts available from the contributed surplus account of $23,047,000 to reduce
the Company's accumulated deficit, and on June 22, 2000, shareholders adopted a
resolution to eliminate the Company's accumulated deficit of $338,620,000 as at
December 31, 1999 by applying amounts available from the contributed surplus
account. Under US GAAP, such transfers are not permitted.

---

82
    CAMBIOR 2005 ANNUAL REPORTNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)24. Generally Accepted Accounting Principles in Canada and the United States
(continued)

A. Consolidated Financial Statements (continued)
(r) Disposal of Assets and Discontinued Operations

Under Canadian GAAP, the gain on disposal of the Carlota project is based on
the carrying value of the project which includes exploration and development
costs capitalized. The Canadian GAAP carrying value of Carlota is therefore
higher than under US GAAP.

Under US GAAP, this gain on disposal is therefore calculated based on a
reduced carrying value. This gain under US GAAP also reflects $372,000 relating
to assets having a $0 cost under US GAAP.

In addition, under US GAAP, the exploration and development expenses related
to that project ($2,125,000 in 2005, $5,888,000 in 2004 and $1,654,000 in 2003)
would be presented separately as discontinued operation in the statement of
operations.

Changes in Accounting Policies Under US GAAP

1) FASB Statement 143

For US GAAP purposes, effective January 1, 2003, the Company adopted the
provisions of FASB Statement 143, "Accounting for Asset Retirement
Obligations". SFAS 143 generally applies to legal obligations associated
with the retirement of long-lived assets that result from the acquisition,
construction, development and/or normal operation of a long-lived asset. The
Company recognizes, when the obligation is incurred, the fair value of an
estimated liability for the future cost for restoring a mine site upon
termination of an operation, with a corresponding increase in the carrying value
of the related long-lived asset. The Company amortizes the amount added to the
asset using the depreciation method established for the related asset and
recognizes an accretion expense in relation with the discounted liability over
the remaining life of the mining property. The liability is adjusted at the end
of each period to reflect the passage of time and changes in the estimated
future cash flows underlying the obligation. For Canadian GAAP purposes, the
Company began accounting for asset retirement obligations retroactively for the
year beginning on January 1, 2004.

In 2003, as a result of the initial application of SFAS 143, a $1,930,000
gain was recorded as a cumulative effect of a change in accounting policy.

2) FASB Statement 123 (revised 2004)

For US GAAP purposes, the Company adopted on January 1, 2004, the provisions
of SFAS 123(R), "Share-based payment".

SFAS 123(R) focuses primarily on accounting for transactions in which an
entity obtains employee services in exchange of share-based payment
transactions. Statement 123(R) requires that such transactions be accounted for
using the fair value-based method and that compensation expense be recorded in
the statement of operations.

The Company elected to apply the modified version of retrospective
application, indicated in SFAS 123(R), under which financial statements for
prior periods are adjusted on a basis consistent with the pro forma disclosures
previously required for those periods. Therefore, the financial statements of
prior years have been restated to record the change of this accounting policy.

---



|CAMBIOR 2005
    ANNUAL REPORT | 83
|------------------------------ | --

The following table presents the impact of SFAS 123(R) on the 2004 financial
statements:

|                                                      |       | 2004  
|----------------------------------------------------- | ----- | ------
|                                                      |       | $     
|Consolidated Balance Sheet                            |       |       
|Fair value of options granted from 1995 to
    2004   |       | 15,873
|Stock-based compensation costs for 2004               |       | 1,580 
|Increase in deficit                                   |       | 17,453
|                                                      |       |       
|Fair value of options exercised from 1995 to
    2004 |       | 212   
|Fair value of options exercised during 2004           |       | 202   
|Increase in common shares                             |       | 414   
|Increase in contributed surplus  residual amount     |       | 17,039
|                                                      |       |       
|                                                      | 2004  | 2003  
|                                                      | $     | $     
|Consolidated Statement of Operations                  |       |       
|Increase in stock-based compensation costs            | 1,580 | 1,065 

SFAS 123(R) has no material impact on earnings (loss) per share as per US
GAAP.

3) Mining Assets: Impairment and Business Combinations

In March 2004, the Emerging Issues Task Force (EITF) of the FASB issued
abstract No. 04-3 providing a consensus that an entity should include value
beyond proven and probable reserves (VBPP) and the effects of anticipated
fluctuations in the future market price of minerals in determining the value
allocated to mining assets in a purchase price allocation. In addition, an
entity should include the cash flows associated with VBPP in estimates of
futures cash flows (both undiscounted and discounted) used for determining
whether a mining asset is impaired. The estimated cash flows should also include
the estimated cash outflows required to develop and extract the VBPP. An entity
should also consider the effects of anticipated fluctuations in the market price
of minerals when estimating future cash flows for impairment testing. This
pronouncement was considered in establishing the impairment loss accounted for
in 2004.

B. Consolidated Comprehensive Income (Loss)

The statement of consolidated comprehensive income (loss) is as follows:

|                                                                                      | 2005    | 2004     | 2003    
|------------------------------------------------------------------------------------- | ------- | -------- | --------
|                                                                                      | $       | $        | $       
|Net earnings (loss) as per US GAAP                                                    | 14,746  | (70,280) | 1,661   
|Other comprehensive income (loss)                                                     |         |          |         
|Foreign currency
    translation adjustment                                           | 5,336   | 16,392   | 19,123  
|Gain (Loss) on hedge
    derivatives                                                  | (7,353) | 42,496   | (19,583)
|Unrealized holding
    gains (losses) on available for-sale-securities                | 3,032   | (966)    | 2,306   
|Realized gains on
    available-for-sale securities                                   | (558)   |         |        
|Other-than-temporary impairment
    charges relating to available-for-sale securities | 1,024   |         |        
|Consolidated comprehensive income (loss)                                              | 16,227  | (12,358) | 3,507   

---

84
    CAMBIOR 2005 ANNUAL REPORTNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)24. Generally Accepted Accounting Principles in Canada and the United States
(continued)

B. Consolidated Comprehensive Income (Loss) (continued)

Changes in items of the other comprehensive income (loss) are as follows:

|                                                     |            | Changes  |         
|---------------------------------------------------- | ---------- | -------- | --------
|                                                     | Balance at | during   | Balance 
|                                                     | beginning  | the year | at end  
|                                                     | $          | $        | $       
|2005                                                 |            |          |         
|Cumulative translation adjustment                    | 6,627      | 5,336    | 11,963  
|Loss on hedge derivatives                            | (12,956)   | (7,353)  | (20,309)
|Unrealized gain on investments                       | 3,102      | 3,498    | 6,600   
|Total changes in other cumulative comprehensive loss | (3,227)    | 1,481    | (1,746) 
|                                                     |            |          |         
|2004                                                 |            |          |         
|Cumulative translation adjustment                    | (9,765)    | 16,392   | 6,627   
|Gain (Loss) on hedge derivatives                     | (55,452)   | 42,496   | (12,956)
|Unrealized gain (loss) on investments                | 4,068      | (966)    | 3,102   
|Total changes in other cumulative comprehensive loss | (61,149)   | 57,922   | (3,227) 
|                                                     |            |          |         
|2003                                                 |            |          |         
|Cumulative translation adjustment                    | (28,888)   | 19,123   | (9,765) 
|Loss on hedge derivatives                            | (35,869)   | (19,583) | (55,452)
|Unrealized gain on investments                       | 1,762      | 2,306    | 4,068   
|Total changes in other cumulative comprehensive loss | (62,995)   | 1,846    | (61,149)

C. Accounting Pronouncements not yet Implemented

1) Statement on Accounting Changes and Error Corrections (SFAS 154)

During the second quarter of 2005, the FASB issued Statement 154, "Accounting
Changes and Error Corrections", which changes the accounting and reporting
requirements for the change in an accounting principle. SFAS 154 requires
retrospective application to prior periods' financial statements of changes in
an accounting principle, unless it is impracticable to do so. SFAS 154
differentiates between retrospective application and restatement. Retrospective
application is defined as the application of a different accounting principle to
prior accounting periods as if that principle had always been used or as the
adjustment of previously issued financial statements to reflect a change in the
reporting entity. SFAS 154 is effective for accounting changes and corrections
of errors made in fiscal years beginning after December 15, 2005. The Company
does not expect this pronouncement to have a material impact on its results of
operations and financial condition.

2)Inventory Costs

In November 2004, the FASB issued SFAS 151, "Inventory Costs  an amendment
of ARB No. 43, Chapter 4". SFAS 151 amends the guidance in ARB No. 43, Chapter 4
"Inventory Pricing", to clarify the accounting for certain abnormal amounts in
establishing inventory valuation. The proposed statement would:

 Recognize as current-period
charges, idle facility expense, excessive spoilage, double freight, and
rehandling costs regardless of whether they meet the criterion of "so abnormal"
as stated in ARB No. 43.

 Require that the
allocation of fixed production overheads to the costs of conversion be based on
the normal capacity of the production facilities.

SFAS 151 is effective for fiscal years beginning after June 15,
2005. The Company is currently evaluating the effect that the adoption of SFAS
151 will have on its consolidated results of operations and financial condition.

---



|CAMBIOR 2005
    ANNUAL REPORT | 85
|------------------------------ | --

3) Exchange of Non-monetary Assets

In December 2004, the FASB issued SFAS 153, "Exchanges of Non-monetary Assets
 an amendment of APB Opinion No. 29". SFAS 153 eliminates the exception from
fair value measurement for non-monetary exchanges of similar productive assets
in paragraph 21(b) of APB Opinion 29, "Accounting for Non-monetary
Transactions," and replaces it with an exception for exchanges that do not have
commercial substance. SFAS 153 is effective for the fiscal periods beginning
after June 15, 2005. The Company does not expect this pronouncement to have a
material impact on its results of operations and financial condition.

4) EITF Issue 04-06: Accounting for Stripping Costs Incurred During
Production

At the March 17, 2005 EITF meeting, the Task Force reached a consensus that
stripping costs incurred during the production phase of a mine are variable
production costs that should be included in the costs of the inventory produced
during the period that the stripping costs are incurred. The Task Force noted
that the consensus does not address the accounting for stripping costs incurred
during the pre-production phase of a mine. The consensus in this Issue is
effective for the first reporting period in fiscal years beginning after
December 15, 2005 with the early adoption permitted. There were no stripping
costs deferred as at December 31, 2005 and 2004. The Company does not expect
this pronouncement to have a material impact on its results of operations and
financial condition. Going forward, this pronouncement may have an impact on
future years if the Company starts a new mining operation, as stripping costs
are usually incurred, in production phase, in the first years of operations of
an open-pit mine.

Canadian GAAP

1) Financial Instruments

In April 2005, the CICA Accounting Standards Board ("AcSB") issued the
following new sections: Section 1530, "Comprehensive Income", Section 3251,
"Equity", Section 3855, "Financial Instruments  Recognition and Measurement",
and Section 3865, "Hedges". These standards, which are aimed at harmonizing
Canadian and US rules, will be applicable for fiscal years starting on or after
October 1, 2006. The Company is currently evaluating the impact of this
pronouncement, including the initial application.

1.1) Section 1530 "Comprehensive Income"

According to Section 1530 "Comprehensive Income", comprehensive income
includes net income as well as all changes in equity during a period, from
transactions and events from non-owners sources.

1.2) Section 3251 "Equity"

This Section establishes standards for the presentation of equity and changes
in equity during the reporting period. The main feature of this Section is a
requirement for an enterprise to present separately each of the changes in
equity during the period, including comprehensive income, as well as components
of equity at the end of the period.

1.3) Section 3855 "Financial Instruments  Recognition and Measurement"

One of the basic principles of Section 3855 is that fair value is the most
relevant measure for financial instruments.

Financial assets, which include trade and loans receivable and investments in
debt and equity securities, must be classified into one of four categories:

 Held-to-maturity investments
(measured at cost);

 Loans and receivables (measured
at amortized cost);

 Held for trading assets (measured
at fair value with changes in fair value recognized in earnings immediately);

 Available-for-sale
assets, including investments in equity securities, held-to-maturity investments
that an entity elects to designate as being available for sale, and any
financial asset that does not fit into any other category (measured at fair
value with changes in fair value accumulated in a separate component of
shareholders' equity called "Other Comprehensive Income" until the asset is
sold). Impairment of investments in securities would be recognized earlier than
under existing GAAP.

Financial liabilities, which include long-term debt and other
similar instruments, must be accounted for at amortized cost, except for those
classified as held for trading, which must be measured at fair value.

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    CAMBIOR 2005 ANNUAL REPORTNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)24. Generally Accepted Accounting Principles in Canada and the United States
(continued)

C. Accounting Pronouncements not yet Implemented (continued)
Canadian GAAP (continued)

1.4) Section 3865 "Hedges"

Section 3865 includes the guidance on hedging relationships that was
previously contained in AcG-13, "Hedging relationships", such as that relating
to the designation of hedging relationships and their documentation and
specifies how hedge accounting should be applied and identifies the information
that should be disclosed.

Derivatives used as hedging items should be measured at fair value
considering the following specific considerations:

 If the derivative is used as a
hedge of an exposure to changes in fair value of an asset or a liability or of a
firm commitment, changes in fair value of derivative and offsetting change in
the fair value of the hedged item attributable to the hedged risk exposure are
recognized in net income. The carrying amount of the hedged item is adjusted for
the gain or loss on the hedged risk.

 If the derivative is used as a
hedge of an exposure to changes in cash flows of an asset or liability or of a
forecasted transaction or of a foreign currency risk relating to a firm
commitment, the portion of the gain or loss on the derivative that is determined
to be an effective hedge is recognized in other comprehensive income. The
portion determined not to be an effective hedge is recognized in net income.
Gains or losses accrued in other comprehensive income are recognized in net
income in the period in which the hedged item has an impact on net earnings.

 A hedge of a net investment in a
self-sustaining foreign operation is treated in a manner similar to a cash flow
hedge.

2) Section 3831 "Non-monetary Transactions"

Section 3831 establishes standards for the measurement and disclosure of
non-monetary transactions. An asset exchanged or transferred in a non-monetary
transaction is measured at its carrying amount when the transaction lacks
commercial substance. Specific criteria are given to assess whether this
condition is present in a particular exchange, which would require an entity to
consider whether its value or its future cash flows have been altered as a
result of the transaction. The "commercial substance" criterion replaces the
"culmination of the earnings process" criterion in former Section 3830. The new
requirements are effective for non-monetary transactions initiated in periods
beginning on or after January 1, 2006. The Company does not expect this
pronouncement to have a material impact on its results of operations and
financial condition.

3) EIC-152 "Mining Assets  Impairment and Business Combinations"

According to EIC-152, an entity should include the value beyond proven and
probable reserves ("VBPP") in the value allocated to mining assets in a purchase
price allocation. Also, an entity should include the cash flows associated with
VBPP in estimates of future cash flows (both undiscounted and discounted) used
for determining whether a mining asset is impaired under Section 3063,
"Impairment of Long-lived Assets", of the CICA Handbook. At last, the effects of
anticipated fluctuations in the future market price of minerals should also be
considered in both determining the fair value of mining assets in a purchase
price allocation and estimating future cash flows (both undiscounted and
discounted) used for determining whether a mining asset is impaired. EIC-152 may
be applied prospectively and should be applied to business combinations
completed after March 26, 2005, and to goodwill and asset impairment tests
performed in reporting periods beginning after March 16, 2005. The Company does
not expect this pronouncement to have a material impact on the accounting of
future business combinations. The Company considered VBPP in the impairment test
for the year ended December 31, 2005.

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