---

|4 | CAMBIOR 2005 ANNUAL REPORT
|- | --------------------------

MANAGEMENT'S DISCUSSION AND ANALYSIS

Cambior's management discussion and analysis ("MD&A") should
be read in conjunction with the audited consolidated financial statements
included in this annual report. The consolidated financial statements have been
prepared in accordance with Canadian generally accepted accounting principles ("GAAP").
We report our results in US dollars; all amounts in the following discussion are
in US dollars unless otherwise noted.

Caution Concerning Forward-looking Statements

This MD&A contains certain "forward-looking statements",
including, but not limited to, statements regarding our strategic plans, future
commercial production, sales (including market share evolution as regards
bauxite and niobium) and financial results, in particular the estimated mining
costs, capital expenditures and exploration and development budget for each of
our mines; construction and production targets and timetables, as well as
anticipated timing of grant of permits and governmental incentives, particularly
as regards Camp Caiman project; expected continuity of a favorable gold market
and plans for reduction of gold hedging; evaluation and evolution of mineral
reserves and resources (Rosebel's potential for further increases in
particular), mine operating costs and capital expenditures, planned work
programs, evolution of development projects as well as exploration budgets and
targets, particularly as regards the Westwood and La Arena projects; litigation
matters, measures of mitigating financial and operational risks; anticipated
liabilities regarding site closure and employee benefits; continuous
availability of required manpower; possible exercise of outstanding warrants
and, more generally, continuous access to capital markets; and Cambior's global
outlook and that of each of its mines. Forward-looking statements express, as at
the date of this MD&A, our plans, estimates, forecasts, projections,
expectations or beliefs as to future events or results. Forward-looking
statements involve a number of risks and uncertainties, many of which are beyond
our control, and there can be no assurance that such statements will prove to be
accurate. Therefore, actual results and future events could differ materially
from those anticipated in such statements. Risks and uncertainties that could
cause results or future events to differ materially from current expectations
expressed or implied by the forward-looking statements include, but are not
limited to, factors associated with fluctuations in the market price of metals
and minerals, mining industry risks and hazards, uncertainty as to estimation of
mineral reserves and resources, requirement of additional financing, risk
related to hedging and non-hedge derivative instruments, risks of delays in
construction, production or obtaining permits and other risks more fully
described in the Risks and Uncertainties section of this MD&A. The reader is
cautioned not to place undue reliance on these forward-looking statements. We do
not undertake to update any forward-looking statement that is contained in this
MD&A.

Cambior Inc.

Cambior Inc. is a Canadian-based gold mining company focused
on the Americas. Since 1986, we have been engaged in the full cycle of mining
from exploration through development, operation, closure and rehabilitation. In
2005, Cambior produced 638,400 ounces of gold, consistent with an average
production of 608,000 ounces during the past five years.

As part of our strategy, we also produce niobium and
refractory-grade calcined bauxite (Refractory "A" Grade Super Calcined, or RASC)
to provide a reliable, long-term source of cash flow to support our gold
operations. In 2005, 25.3% of our revenues were generated by our non-gold
operations. Highlights for 2005 are:

> 













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|CAMBIOR 2005
    ANNUAL REPORT | 5
|------------------------------ | -

Since late 2001, we have focused on renewing our asset base
to benefit from improved gold prices. Our initial priority was to develop the
Rosebel deposit, which reached commercial production in February 2004, and has
since been delivering strong performance and increasing shareholder value. The
investment program initiated in 2001 is now beginning to provide a strong
operating base that should allow us to reach our annual production objective of
800,000 ounces, supported by a minimum reserve base of 8 million ounces.

During the year, we met most of the goals outlined in our
2004 Annual Report. In particular, we:

> 









Objective and Strategy

At Cambior, we are focused on providing a superior rate of
return to our shareholders through the appreciation of our shares, which trade
on the TSX and AMEX.

We believe that Cambior's share price is ultimately a
reflection of its net asset value. We therefore aim to maximize this value
through the following strategy:

1. Maximize the
value of our mining operations and projects 


2. Grow our reserve/resource base 
By
discovering new deposits, delineating further reserves at our current operating
mines and projects, and acquiring new deposits and mining operations.

3. Maintain a strong financial capacity

By ensuring
that we have the cash resources and access to financial markets required to
support our capability of finding, developing and expanding mining projects.

---



|6 | CAMBIOR 2005 ANNUAL REPORT
|- | --------------------------

MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)

Objective and Strategy (continued)

Key Performance Indicators and Selected Financial Data

|                                                     | 2005    | 2004    | 2003   
|---------------------------------------------------- | ------- | ------- | -------
|Gold ($/oz.)                                         |         |         |        
|Average market price                                 | 444     | 409     | 363    
|Average realized price                               | 421     | 370     | 320    
|Exchange rate (C$/US$)                               | 1.2116  | 1.3015  | 1.4015 
|Gold production (oz.)                                | 638,400 | 694,100 | 521,500
|Mine operating costs ($/oz.)                         | 285     | 244     | 241    
|Ounces of gold sold                                  | 649,900 | 687,800 | 516,800
|Revenues ($ millions)                                |         |         |        
|Gold                                                 | 274.7   | 255.2   | 165.9  
|Non-gold                                             | 93.2    | 44.8    | 25.0   
|Total revenues ($ millions)                          | 368.5   | 300.9   | 193.9  
|Net earnings (loss) ($ millions)                     | 20.2    | (73.8)  | 0.8    
|Cash flow from operating activities ($
    millions) | 40.5    | 38.0    | 24.2   
|Net capital investments ($ millions)                 | 79.5    | 133.0   | 107.2  
|Cash and short-term investments ($ millions)         | 15.6    | 54.9    | 95.2   
|Total assets ($ millions)                            | 621.4   | 590.4   | 498.4  
|Total debt ($ millions)                              | 63.0    | 65.2    | 64.2   
|Deferred revenue ($ millions)                        |        | 12.2    | 24.4   
|Shareholders' equity ($ millions)                    | 401.7   | 375.0   | 338.3  
|Proven and probable reserves (oz. millions)          | 5.0     | 3.5     | 4.1    
|Share price (closing
    price)                      |         |         |        
|US$ (AMEX)                                           | 2.79    | 2.67    | 3.10   
|C$ (TSX)                                             | 3.25    | 3.21    | 3.99   

Revenues increased substantially in 2004 and 2005 due to new
gold production from the Rosebel mine beginning in February 2004 and the
acquisition of an increased participation in Niobec and Omai Bauxite, as well as
improved gold prices. The increase in our asset base has generated improved
earnings, although 2004 earnings were impacted by a $73.2 million asset
impairment loss at the Doyon mine.

Market Trends

Cambior generates revenues predominately from the sale of
gold, and to a lesser degree from the sale of ferroniobium and bauxite.

Gold Market

The gold market is relatively small in comparison to other
major commodity markets. It is characterized by substantial above-ground
reserves that can dramatically affect the price should a portion of these
reserves be brought to market. The significant holders of these gold reserves
are central banks. In September 1999, 15 large European central banks signed the
Washington Agreement to ensure the orderly disposal of such reserves. The
Washington Agreement was renewed in 2004 for a five-year term with additional
participants, which will help ensure continued stability in the marketplace.

---



|CAMBIOR 2005
    ANNUAL REPORT | 7
|------------------------------ | -

Because the gold market is small, changes in supply and demand can result in
significant price fluctuations. In the past 25 years, the gold price has
fluctuated as follows:

Gold Price  London PM Fix (US$/oz.)



During 2005, the gold price continued its upward trend from
the 25-year low experienced in 2001. Gold traded between $411 and $513 per
ounce, with strong price levels in the fourth quarter. The 2005 average price
was $444 per ounce compared to $409 in 2004 and $363 in 2003. The gold price has
strengthened in recent years due to:

1. Falling gold
supply due to declining mine output and producer dehedging;

2. Rising jewellery
demand;

3. Increased
investment demand by speculators;

4. Increased
investment demand by investors due to the introduction of new gold investment
products aimed at facilitating the holding of gold as part of investment
portfolios;

5. Continued
devaluation of the US dollar against other currencies (particularly the Euro);

6. Low interest
rates that reduced the opportunity cost of holding gold as an investment; and

7. Geopolitical
tensions in the Middle East and the war on terrorism.

These factors are generally expected to persist over the
medium term, and to support a rising gold price. Indeed, in the first 45 days of
2006, the gold price remained strong at levels not seen since the early 1980s.

---



|8 | CAMBIOR 2005 ANNUAL REPORT
|- | --------------------------

MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)

Market Trends (continued)

Niobium Market

Niobium is a strengthening element used in the manufacture of
specialty steel alloys. Small additions of niobium increase the strength and
durability of steel used in pipelines, the automobile industry and structures.

Unlike most other commodities, the niobium price remained
constant over the past five years, although it rose somewhat in the latter part
of 2005. However, niobium demand has increased significantly due to a general
increase in the use of niobium, high demand in China and the additional use of
niobium as a substitute for other, higher-priced specialty alloys.

Cambior is one of three producers worldwide, and has held a
market share of between 10% and 15% over the past five years. The market is
dominated by a Brazilian producer that strongly influences market conditions.
Cambior's competitiveness in certain markets is also impacted by tariffs and
duties imposed by governments. Nevertheless, steady market growth has enabled us
to expand production and increase sales. We expect continued growth in the use
of niobium.

Bauxite Market

In general, calcined bauxite products are used for the
production of refractories, abrasive products and welding products. The calcined
bauxite produced by Cambior is currently only designed to meet the needs of the
refractory market. The worldwide market for refractory-grade bauxite, or RASC,
is approximately 1.3 million tonnes per year. The unique physical and chemical
characteristics of Guyanese bauxite have made it the preferred material for many
refractory companies and customers around the world. Nevertheless, because of
lower prices, multiple Chinese producers now account for an estimated 80% of
worldwide supply.

Cambior expects to produce over 300,000 tonnes of RASC in
2006, accounting for approximately 25% of the worldwide market. However, as fuel
price is a significant component of our direct production and transportation
costs, our RASC sales volume may be adversely affected by high fuel prices.

We are currently working on developing new products from our
bauxite deposit that would complement our RASC product and contribute to the
profitability of our bauxite operation.

Consolidated Operations

Net Earnings

In 2005, Cambior earned record profits of $20.2 million.
Profits for fiscal 2005 were largely based on a strong performance at Rosebel
and the gain on the disposal of the Carlota project in the fourth quarter of the
year. Net earnings (loss) and per share data for the past three years were as
follows:

|                                 | 2005 | 2004   | 2003
|-------------------------------- | ---- | ------ | ----
|Net earnings (loss) ($ millions) | 20.2 | (73.8) | 0.8 
|Per share ($)                    |      |        |     
|Basic                            | 0.07 | (0.30) | 0.00
|Diluted                          | 0.07 | (0.30) | 0.00

Revenues

Revenues during the past three years were as follows:

|                            | 2005    | 2004    | 2003   
|--------------------------- | ------- | ------- | -------
|Ounces of gold sold         | 649,900 | 687,800 | 516,800
|Revenues ($ millions)       |         |         |        
|Gold                        | 274.7   | 255.2   | 165.9  
|Non-gold                    | 93.2    | 44.8    | 25.0   
|Investment and other income | 0.6     | 0.9     | 3.0    
|Total                       | 368.5   | 300.9   | 193.9  

---



|CAMBIOR 2005
    ANNUAL REPORT | 9
|------------------------------ | -

The increase in revenues in 2005 was due to:







In the past, we made use of various instruments to reduce the
volatility of our gold revenues and secure cash flows from our operating mines.
As part of a financial restructuring in 2001, our lenders imposed a revenue
protection program requiring that 70% of production until 2005 be protected at a
minimum price of $290 per ounce. We were obliged to implement this program at a
time when gold traded between $256 and $293 per ounce, severely hindering our
opportunity to benefit from the subsequently improving gold market.

In 2003, we succeeded in negotiating the elimination of the
requirement to maintain a revenue protection program. At the same time, we
adopted a new corporate policy providing for full exposure to the market price
for our gold production, leading to greater volatility of our revenues and
profitability and requiring a reduced level of debt related to project
development. Since then, we have aggressively reduced our forward sales through
opportunistic buy-backs and deliveries against commitments. As a result, we have
cut our gold hedging commitments under the revenue protection program, including
our prepaid gold forward sales, by 1.7 million ounces (91.3%) since 2001.

The buy-back of gold commitments impacts our revenues, as any
losses incurred must be recorded as a reduction in sales, thereby partially
offsetting the impact of sales made at market.

The impact of gold hedging on both earnings and operating
cash flow in recent years and the estimated impact for future years based on a
market gold price of $475 per ounce are as follows:

|                                                                                              | 2002   | 2003   | 2004    | 2005   | 2006 (E) | 2007 (E)
|--------------------------------------------------------------------------------------------- | ------ | ------ | ------- | ------ | -------- | --------
|Average market gold price ($/oz.)                                                             | 310    | 363    | 409     | 444    | 475      | 475     
|Impact on earnings ($
    millions)                                                           | (17.6) | (21.6) | (36.9)* | (12.0) | (8.6)    | (3.0)   
|Impact on operating cash flow ($
    millions)                                                | (3.8)  | (21.7) | (36.0)  | (12.0) | (18.2)   | (7.1)   
|*
    Includes the mark-to-market of Doyon's hedges as part of the asset
    impairment loss.

During 2005, our average realized price was $421 per ounce
compared to an average market price of $444 per ounce. The average realized
prices for 2004 and 2003 were $39/oz. and $43/oz. below market price,
respectively.

During 2005, we made the final deliveries on our prepaid gold
forward sales agreement, which was negotiated as part of the 2001 restructuring
program. Under the agreement, we received a lump sum of $55 million in early
2001 in consideration of the delivery of 233,637 ounces over the next five
years. We recorded the proceeds as deferred revenue and recognized this revenue
over the term of the agreement. The impact on earnings and cash flow over the
past three years was as follows:

|     |           | Assigned  | Market    | Impact
    on | Impact
    on
|---- | --------- | --------- | --------- | ------------- | -------------
|     | Ounces    | price     | price     | earnings      | cash
    flow
|     | delivered | ($/ounce) | ($/ounce) | ($ million)   | ($ million)  
|2003 | 52,000    | 235       | 363       | (6.7)         | (18.9)       
|2004 | 52,000    | 235       | 409       | (9.1)         | (21.3)       
|2005 | 52,000    | 235       | 444       | (10.9)        | (23.1)       

The impact of the remaining ounces sold under forward
contracts will be of lesser importance as they now represent only a small
portion of production and reserves. Furthermore, we remain committed to the
opportunistic buy-back of the remaining 2006-2007 positions on spot gold price
weaknesses. Finally, we will be exposed to the market with respect to an
additional 50,000 ounces of gold to be received over the next two years from the
sale of Carlota.

---



|10 | CAMBIOR 2005 ANNUAL REPORT
|-- | --------------------------

MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)

Consolidated Operations (continued)

Revenues (continued)

The table below summarizes the operating profit (loss) from mining
operations:

|(in millions of $)                           | 2005  | 2004   | 2003 
|-------------------------------------------- | ----- | ------ | -----
|Revenues                                     | 368.5 | 300.9  | 193.9
|Operating costs                              | 256.4 | 209.6  | 144.3
|Refining and
    transportation              | 12.9  | 3.4    | 2.1  
|Royalties                                    | 12.9  | 11.5   | 5.4  
|Mining operations                            | 282.2 | 224.5  | 151.8
|Depreciation,
    depletion and amortization | 47.9  | 46.9   | 28.7 
|Impairment loss and
    restructuring costs  |      | 73.2   |     
|Total mine expenses                          | 330.1 | 344.6  | 180.5
|Operating profit (loss)                      | 38.4  | (43.7) | 13.4 
|Net earnings (loss)                          | 20.2  | (73.8) | 0.8  

Mine operating costs rose in 2005, due mainly to higher
production levels at our non-gold operations. In particular, higher refining and
transportation charges were directly attributable to the increased volume of
non-gold production. Mining costs were also significantly affected by strong
inflationary pressures on fuel and most other supplies. Furthermore, our
Canadian-based operations continued to be impacted by the strength of the
Canadian dollar against the US dollar; the C$/US$ exchange rate averaged 1.2116
in 2005, 1.3015 in 2004 and 1.4015 in 2003. We also incurred higher royalty
costs resulting from increased fees payable under the price participation
formula applicable to Doyon and Rosebel. These negative factors were partially
counterbalanced by the low-cost Rosebel operation.

In 2004, mine operating costs rose mainly as a result of the
impact of the stronger Canadian currency on our Canadian operations, reduced
thoughput at Doyon and higher-priced consumables.

Gold production and unit mine operating costs were:

|                                                                                                                        |         | 2005  |         | 2004  |         | 2003 
|----------------------------------------------------------------------------------------------------------------------- | ------- | ----- | ------- | ----- | ------- | -----
|                                                                                                                        | Ounces  | $/oz. | Ounces  | $/oz. | Ounces  | $/oz.
|Rosebel mine                                                                                                            | 341,400 | 208   | 273,700 | 170   |        |     
|Omai mine                                                                                                               | 99,500  | 366   | 240,400 | 244   | 271,000 | 220  
|Doyon Division                                                                                                          | 157,500 | 358   | 146,500 | 374   | 217,200 | 267  
|Sleeping Giant mine1                                                                                                    | 40,000  | 449   | 33,500  | 291   | 33,300  | 246  
|Total                                                                                                                   | 638,400 | 285   | 694,100 | 244   | 521,500 | 241  
|1
    Cambior initially owned a 50% interest in the mine, and acquired the
    residual 50% interest on April 30, 2005.

---



|CAMBIOR 2005
    ANNUAL REPORT | 11
|------------------------------ | --

The summary analysis and outlook for each of
Cambior's operating units are as follows:

Rosebel Mine

The Rosebel mine is located in Suriname, South America, some
100 kilometers south of Paramaribo, the country's capital. The mine has been in
production since February 11, 2004.

The Rosebel mine continued to exceed forecasts in 2005,
surpassing the performance anticipated in the Feasibility Study that justified
the initial investment at $300 per ounce of gold. The table below shows the
mine's strong performance to date.

|          | Throughput       | Grade    | Gold Output | Mine Operating Costs
|--------- | ---------------- | -------- | ----------- | --------------------
|          | (Tonnes per day) | (g Au/t) | (ounces)    | ($/ounce)           
|Quarter 1 | 13,400           | 1.6      | 27,300      | 163                 
|Quarter 2 | 14,500           | 2.0      | 74,100      | 160                 
|Quarter 3 | 16,300           | 1.7      | 79,000      | 195                 
|Quarter 4 | 17,200           | 1.9      | 93,300      | 158                 
|2004      | 15,200           | 1.8      | 273,700     | 170                 
|          |                  |          |             |                     
|Quarter 1 | 20,400           | 1.6      | 88,000      | 190                 
|Quarter 2 | 19,400           | 1.7      | 89,600      | 190                 
|Quarter 3 | 19,600           | 1.5      | 82,000      | 226                 
|Quarter 4 | 19,400           | 1.5      | 81,800      | 230                 
|2005      | 19,700           | 1.6      | 341,400     | 208                 

Mill throughput levels were maximized in 2005 to generate
increased gold output and counter the rising cost of consumables and supplies.
Because of this, we modified the original mining plan, which called for
selective mining of higher-grade ore and stockpiling of low-grade material for
milling later in the mine life. Consequently, all the ore is now being fed to
the processing plant, which resulted in a lower grade than originally called for
in the Feasibility Study for the first six months of 2005.

The success of Rosebel's first two years of operations has
highlighted the mine's potential. Following the successful startup and mine
optimization program, we embarked on an aggressive exploration and development
drilling program with the intention of doubling the initial reserve base of 2.1
million ounces, as we had done previously at the Omai mine in neighbouring
Guyana. Benefiting from an improved gold price and information gained from the
$11.0 million invested in drilling in 2004 and 2005, reserves at December 31,
2005 were nearly 1.5 million ounces higher than the original reserve estimate,
as shown below:

Rosebel Mineral Reserves

|                                                         | Tonnage | Grade    | Contained Gold
|-------------------------------------------------------- | ------- | -------- | --------------
|                                                         | (000t)  | (g Au/t) | (000 oz.)     
|Pay Caro                                                 | 17,223  | 1.5      | 844           
|East Pay Caro                                            | 10,892  | 1.1      | 397           
|Koolhoven                                                | 5,144   | 1.3      | 220           
|Royal Hill                                               | 22,014  | 1.4      | 1,006         
|Mayo                                                     | 8,065   | 1.3      | 343           
|Rosebel                                                  | 7,972   | 1.3      | 340           
|Stockpiles                                               | 1,736   | 1.1      | 62            
|Reserves  December 31, 2005(1)                          | 73,046  | 1.4      | 3,212         
|Production  2005                                        | 7,196   | 1.6      | 361           
|Production  2004                                        | 5,067   | 1.8      | 300           
|Cumulative  Production and
    Reserves (Dec. 31, 2005) | 85,309  | 1.4      | 3,873         
|Reserves  December 31, 2004(2)                          | 52,910  | 1.5      | 2,459         
|Reserves  December 31, 2003(3)                          | 47,165  | 1.6      | 2,382         
|(1) Based on gold price
    of $425 per ounce.           |         |          |               
|(2)
    Based on gold price of $400 per ounce.           |         |          |               
|(3)
    Based on gold price of $350 per ounce.           |         |          |               



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|12 | CAMBIOR 2005 ANNUAL REPORT
|-- | --------------------------

MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)

Rosebel Mine (continued)

Rosebel Mineral Reserves (continued)

We are confident that we can further add to this reserve
base, as the property has significant geological potential and our staff has
identified excellent exploration targets.

Cambior holds 95% of the participating share capital of
Rosebel Gold Mines N.V., our Surinamese operating company, while the remaining
5% is held by the Republic of Suriname. A Mineral Agreement was signed with the
Republic of Suriname in 1994 and amended to reflect improved business conditions
in March 2003. Rosebel's production is subject to royalties and a price
participation right, payable as follows:







In 2005, Rosebel Gold
Mines N.V. paid $3.8 million ($2.5 million in 2004) in royalties to Grassalco
and the foundation, and Cambior paid $4.7 million ($2.9 million in 2004) in gold
price participation.

Rosebel Operating and Financial Statistics

|                                                                      | 2004(1)   | 2005      | Target 2006
|--------------------------------------------------------------------- | --------- | --------- | -----------
|Tonnage mined (000 t)                                                 | 16,780    | 21,937    | 27,444     
|Tonnage milled (000 t)                                                | 5,067     | 7,196     | 7,133      
|Grade milled (g Au/t)                                                 | 1.84      | 1.56      | 1.56       
|Gold recovery (%)                                                     | 94        | 94        | 94         
|Production (oz. Au)                                                   | 273,700   | 341,400   | 335,200    
|Direct mining costs ($/oz.)                                           | 168       | 206       | 238        
|Refining and transportation ($/oz.)                                   | 2         | 2         | 2          
|Mine operating costs ($/oz.)                                          | 170       | 208       | 240        
|Royalties ($/oz.)                                                     | 9         | 25        | 30         
|Total cash costs ($/oz.)                                              | 179       | 233       | 270        
|Depreciation ($/oz.)                                                  | 78        | 56        | 73         
|Restoration ($/oz.)                                                   |          |          |           
|Total production costs ($/oz.)                                        | 257       | 289       | 344        
|Mineral reserves (oz. Au)                                             | 2,459,000 | 3,212,000 |            
|(1)The Rosebel mine began commercial production on February 11, 2004.

Capital expenditures for 2005 were $27.9 million, mainly to
complete Phase-2 construction of the plant, add to the mining fleet and conduct
exploration and development drilling. In 2004 and 2003, during the mine
construction and initial year of production, we invested $41.9 million and $91.3
million respectively.

Outlook

Rosebel is expected to produce 335,000 ounces of gold in 2006
at an estimated mine operating cost of $240 per ounce. The higher operating
costs are due to a higher stripping ratio and a rising hard rock component of
mill feed.

Based on the success of the 2005 reserve development program,
we are planning a similar effort for 2006. We have allocated an initial budget
of $5.0 million on development drilling of the existing deposits, and an
additional $1.5 million to explore for new deposits on the Rosebel mining
concession. The sustaining capital budget is $8.3 million, and covers mainly
mine equipment purchases and expansion of the tailings dam capacity.

---



|CAMBIOR 2005
    ANNUAL REPORT | 13
|------------------------------ | --

Omai Gold Mine

After 13 years of operation, the Omai gold mine closed in
late September 2005, once the low-grade stockpile accumulated in prior years had
been processed. Mining had ended in September 2004 following the depletion of
the Fennell pit. Overall, the open-pit mine, located 160 kilometers south of the
capital city of Georgetown, Guyana, produced over 3.7 million ounces, with a
peak annual production of 354,300 ounces reached in 2001. The mine's strong
performance was somewhat overshadowed by the difficult price environment for
gold during its lifetime.

In 2005, the Omai gold mine produced 99,500 ounces at a mine
operating cost of $366 per ounce, compared to a budgeted 107,000 ounces at a
mine operating cost of $293 per ounce. The operation was impacted by high fuel
prices, the main cost component at Omai as we operated our own diesel
power-generating units to power the operation.

The dismantling of the Omai facilities began in 2003, when we
transferred a significant portion of the processing facilities and mobile
equipment to Rosebel. We also successfully redeployed certain assets to Linden
to support our bauxite operations. We have earmarked some of the remaining
facilities for use at other operations, including Camp Caiman. The mine
personnel is currently in the process of executing the approved government
closure. Prior to final closure, however, we intend to evaluate the potential
for an underground operation based on the depth extension of the Fennell
deposit. Should an adequate level of reserves be identified, the economics of
such an operation could be enhanced by the availability of the remaining
processing facilities, surface plant, camp and infrastructure.

Cambior and the Co-operative Republic of Guyana respectively
own 95% and 5% of the voting common shares of OMAI Gold Mines Limited (OGML).
Cambior's relationship with OGML and the State of Guyana is governed by a
Mineral Agreement that provides for a 5% in-kind royalty on Omai's mineral
production payable to the Co-operative Republic of Guyana, and basic business
conditions governing the operation of the Omai mine.

Omai Operating and Financial Statistics

|                                    | 2003    | 2004    | 2005  
|----------------------------------- | ------- | ------- | ------
|Tonnage milled (000 t)              | 5,748   | 5,545   | 3,703 
|Grade milled (g Au/t)               | 1.6     | 1.46    | 0.91  
|Gold recovery (%)                   | 92      | 93      | 90    
|Production (oz. Au)                 | 271,000 | 240,400 | 99,500
|Direct mining costs ($/oz.)         | 200     | 226     | 364   
|Deferred stripping ($/oz.)          | 18      | 17      |      
|Refining and transportation ($/oz.) | 3       | 3       | 3     
|By-product credits ($/oz.)          | (1)     | (2)     | (1)   
|Mine operating costs ($/oz.)        | 220     | 244     | 366   
|Royalties ($/oz.)                   | 18      | 20      | 21    
|Total cash costs ($/oz.)            | 238     | 264     | 387   
|Depreciation ($/oz.)                | 36      | 37      | 34    
|Restoration ($/oz.)                 | 2       | 1       | 2     
|Total production costs ($/oz.)      | 276     | 302     | 423   
|Mineral reserves (oz. Au)           | 359,100 | 122,000 |       

Outlook

In 2006, we will continue to restore the Omai mine site. Rehabilitation costs
are expected to be approximately $1.8 million, in line with environmental
provisions, and will be funded from cash resources. We will also invest some
$3.5 million to assess the potential for an underground operation at Omai.

---



|14 | CAMBIOR 2005 ANNUAL REPORT
|-- | --------------------------

MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)

Doyon Division

The Doyon Division comprises two adjacent underground mines,
Doyon and Mouska, located approximately 40 kilometers east of Rouyn-Noranda, in
the Province of Québec, Canada. The Doyon property covers an area of
approximately 2,870 hectares on the prolific Cadillac-Bousquet gold belt in the
Abitibi region.

In operation since 1980, the Doyon mine produced its
5,000,000th ounce in January 2006. Originally in a 50/50 partnership with
Barrick Gold Corporation, Cambior assumed operatorship of the mine in 1998 when
it acquired Barrick's interest in the mine. As part of the acquisition price, we
granted a 24.75% price participation right on the amount exceeding the average
annual market price of $375 per ounce on the first 2,000,000 ounces produced
following the transaction.

In the past two years, the mine faced ground stability issues
that led to a reassessment of reserves. We reduced the Doyon reserve base by
approximately 245,500 ounces in 2004 and a further 187,000 ounces in 2005. A new
mine plan was implemented, and the resulting cutback in production entailed a
significant reduction in the workforce in September 2004, as well as a $73.2
million impairment charge for the 2004 financial year.

When we consolidated ownership of the Doyon mine, we began
integrating the activities of the Doyon and Mouska mines to benefit from
operating synergies. Since then, Mouska production has been trucked four
kilometers and processed at the Doyon mill. A high-grade deposit discovered by
Cambior in the late 1980s, Mouska commenced production in 1992 and has produced
561,400 ounces to date. Production was suspended from December 2003 to October
2004 to allow for the deepening of an internal shaft to gain access to deeper
levels. Mouska production is subject to royalties totalling 2.2%.

During 2005, the Doyon Division produced 157,500 ounces of
gold at a mine operating cost of $358 per ounce, compared to a target of 166,000
ounces at $322 per ounce. The Doyon mine experienced production difficulties
that affected the tonnage processed. Operating costs were also affected by
inflationary pressures driven by energy costs and the strengthening Canadian
dollar. In 2004, production was impacted by ground control issues at Doyon and
suspension of production at Mouska to allow for shaft deepening. In 2003, gold
output was 217,200 ounces, with the plant operating at full capacity to process
ore from the Doyon and Mouska mines. Mine operating costs for 2003 were lower
due to economics of scale and a weaker C$/US$ exchange rate.

Doyon Division Operating and Financial Statistics

|                                        | 2003      | 2004    | 2005    | Target 2006
|--------------------------------------- | --------- | ------- | ------- | -----------
|Tonnage milled (000 t)                  |           |         |         |            
|Underground mines                       | 1,123     | 964     | 773     | 732        
|Open-pit and low-grade stockpiles       | 155       | 208     | 33      | 89         
|Total                                   | 1,278     | 1,172   | 806     | 821        
|Grade milled (g Au/t)                   |           |         |         |            
|Underground mines                       | 6.2       | 4.6     | 6.6     | 6.4        
|Open-pit and low-grade stockpiles       | 1.0       | 1.5     | 1.0     | 1.4        
|Average                                 | 5.6       | 4.1     | 6.3     | 5.9        
|Gold recovery (%)                       | 95        | 96      | 96      | 96         
|Production (oz. Au)                     | 217,200   | 146,500 | 157,500 | 150,000    
|Direct mining costs ($/oz.)             | 267       | 375     | 360     | 383        
|Refining and
    transportation ($/oz.) | 1         | 1       | 1       | 1          
|By-product credits ($/oz.)              | (1)       | (2)     | (3)     | (3)        
|Mine operating costs ($/oz.)            | 267       | 374     | 358     | 381        
|Royalties ($/oz.)                       | 2         | 9       | 14      | 20         
|Total cash costs ($/oz.)                | 269       | 383     | 372     | 401        
|Depreciation ($/oz.)                    | 71        | 97      | 87      | 91         
|Restoration ($/oz.)                     | 5         | 6       | 8       | 9          
|Total production costs ($/oz.)          | 345       | 486     | 467     | 501        
|Mineral reserves (oz. Au)               | 1,258,500 | 868,600 | 573,000 |            

Capital expenditures amounted to $8.6 million in 2005 and consisted mainly of
underground infrastructure and development. At year-end, proven and probable
reserves stood at 2,794,000 tonnes at an average grade of 6.4 g/t for 573,000
ounces, representing a decrease of 34.1%.

---



|CAMBIOR 2005
    ANNUAL REPORT | 15
|------------------------------ | --

Outlook

Cambior owns a significant land position around the Doyon
mine property. The area has a rich history of production and hosts significant
reserves. We continue to fund significant efforts to expand the reserve/resource
base and benefit from the existing infrastructure and workforce. During 2006,
the Doyon Division is expected to produce 150,000 ounces of gold at an estimated
mining operating cost of $381 per ounce. Capital expenditures for 2006 are
estimated at $8.5 million, mainly for underground infrastructure and exploration
in the Mouska area.

Sleeping Giant Mine

The Sleeping Giant mine is located in northwestern Québec,
approximately 80 kilometers north of Amos. It is a high-grade, vein-type,
underground gold mine.

On April 30, 2005, Cambior consolidated the ownership of the
Sleeping Giant mine by acquiring the remaining 50% interest from Aurizon Mines
Ltd. for $4.1 million.

During the year, Sleeping Giant produced 40,000 ounces at a
mine operating cost of $449 per ounce. The Sleeping Giant mine turned in a
disappointing performance in 2005 as a result of a major labour shortage. The
mine experienced a high level of employee turnover that directly impacted its
productivity, as it is a labour intensive operation. To alleviate the situation,
we have initiated a major recruitment and training program directly targeting
younger workers.

Sleeping Giant Operating and Financial Statistics

|Cambior's share (50% prior to May
    2005, 100% thereafter) | 2003   | 2004   | 2005    | Target 2006
|------------------------------------------------------------ | ------ | ------ | ------- | -----------
|Tonnage milled (000 t)                                       | 88     | 96     | 121     | 126        
|Grade milled (g Au/t)                                        | 12.1   | 11.1   | 10.6    | 11.1       
|Gold recovery (%)                                            | 97     | 97     | 97      | 97         
|Production (oz. Au)                                          | 33,300 | 33,500 | 40,000  | 44,000     
|Direct mining costs ($/oz.)                                  | 251    | 298    | 454     | 417        
|Refining and
    transportation ($/oz.)                      | 2      | 2      | 2       | 2          
|By-product credits ($/oz.)                                   | (7)    | (9)    | (7)     | (11)       
|Mine operating costs ($/oz.)                                 | 246    | 291    | 449     | 408        
|Depreciation ($/oz.)                                         | 53     | 63     | 105     | 108        
|Restoration ($/oz.)                                          | 5      | 6      | 4       | 7          
|Total production costs ($/oz.)                               | 304    | 360    | 558     | 523        
|Mineral reserves (oz. Au)                                    | 79,200 | 91,600 | 137,800 |            

During the year, capital expenditures at Sleeping Giant totalled $4.0
million, principally related to underground exploration and deferred
development.

Drilling at the mine resulted in a gain in mineral reserves; at year-end,
reserves stood at 376,000 tonnes grading 11.4 g Au/t, representing 138,000
ounces of gold contained.

Outlook

Sleeping Giant's targeted 2006 production is 44,000 ounces of gold at an
estimated mine operating cost of $408 per ounce. Operating costs are expected to
decrease as a result of higher productivity. Capital expenditures for 2006 are
estimated at $2.0 million, mainly for reserve and deferred development.

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|16 | CAMBIOR 2005 ANNUAL REPORT
|-- | --------------------------

MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)

Niobec Mine

In operation since 1976, the Niobec mine is a reliable
supplier of niobium, currently producing approximately 10% of world consumption.
Originally a 50% partner in the mine, Cambior acquired the remaining 50% in
mid-2004 and has operated the mine since then. As operator, we have focused on
increasing production by raising plant throughput and expanding the processing
and ferroniobium converting plants. In 2005, we invested $6.1 million to expand
and optimize the plant. Additional amounts were also allocated to sustaining
capital and underground infrastructure development.

Sales for 2005 amounted to $51.4 million, compared to $37.9
million in 2004 and $22.5 million in 2003. The increased sales in 2004 and 2005
were attributable to the acquisition of the additional 50% interest in 2004 and
the completion of the expansion program in 2005. It should be noted that
profitability in 2005 was affected by increased reagent costs, a stronger
Canadian dollar relative to the US currency, and certain operational
inefficiencies caused by implementing the expansion program while maintaining
production.

At year end, reserves at Niobec stood at
21,487,000 tonnes at a grade of 0.67% Nb2O5. We expect
that reserves can be further increased at depth.

Outlook

Niobium revenues for 2006 are expected to be approximately
$60 million. Capital expenditures for 2006 are estimated at $6.2 million for
sustaining capital and outlays required to increase production by a further 10%.

Omai Bauxite Mine

Given our 13 years of experience in Guyana and our desire to
maintain a profitable operating base and participate in further gold mining
operations in the country, we entered into an agreement with the Co-operative
Republic of Guyana in December 2004 to participate in the privatization of
certain assets of Linden Mining Enterprise, an entity wholly-owned by the
Co-operative Republic of Guyana. A new company, Omai Bauxite Mining Inc. (OBMI),
was formed to acquire the privatized assets, with Cambior holding a 70% interest
and the Co-operative Republic of Guyana holding the remaining 30%. The
Co-operative Republic of Guyana contributed the mineral deposits and the
processing plant with its service facilities, for a deemed value of $5.2
million. Cambior invested $12.2 million to gain a 70% interest, including $5
million in cash and the balance through mine equipment transfers from the Omai
gold mine.

OBMI currently markets one primary product, a trademarked
high-alumina calcined bauxite known as Refractory "A" Grade Super Calcined (RASC).
This product represents approximately 90% of the operation's total revenues,
with the balance generated by two non-calcined products, a chemical grade
bauxite and a cement grade bauxite. The operation also has the capacity to
produce a metallurgical-grade bauxite (MAZ) and other non-metallurgical
products, depending on market conditions. As part of the privatization
agreement, both partners have agreed to reinvest all free cash flow during the
initial five years following privatization to expand the operation into other
products based on strong economic justification and to repay project debts.

To provide a stable source of power to OBMI's operations,
Cambior incorporated a wholly-owned subsidiary and transferred surplus power
generation units from the Omai gold mine to Linden, with the cost of their
installation covered by non-recourse funding from a Caribbean institution. The
power-generating subsidiary also provides power to a government-owned entity for
distribution to the community, under a 15-year power agreement.

During 2005, Cambior focused on increasing plant production
by embarking on a rehabilitation program funded by a $10 million non-recourse
credit facility from a Caribbean financial institution. The enhanced mining
fleet and stabilized operations resulted in the production of 212,000 tonnes of
RASC, in line with the plan for the first year.

Affected by steep fuel prices and start-up inefficiencies,
the bauxite operations essentially broke even in 2005. To secure adequate
margins, we have gradually introduced product pricing indexed to the fuel price.

Proven and probable mineral reserves at the
mine stood at 61.8 million tonnes grading 60% Al2O3 at
year-end 2005,corresponding to a
mine life of more than 70 years at the forecast 2006 production rate.

---



|CAMBIOR 2005
    ANNUAL REPORT | 17
|------------------------------ | --

Outlook

In 2006, Omai Bauxite will process approximately 874,000
tonnes of raw bauxite with an overall process yield of 34.6% for production of
approximately 300,000 tonnes of RASC. Our goal for 2006 is to reduce operating
costs and increase production. We also intend to develop additional products to
contribute to the profitability of the venture. We expect OBMI to generate
approximately $64 million in sales in 2006, although we recognize that continued
high fuel prices and other economic conditions could adversely impact our sales
volume for the year.

Camp Caiman Project

The Camp Caiman gold project is located about 45 kilometers
southeast of Cayenne, the capital city of French Guiana, an overseas department
of France located on the northeastern coast of South America between Brazil and
Suriname. Cambior holds a 30 km2 mining concession for the project,
valid for a period of 25 years. We completed the Feasibility Study for the
project in August 2005. The Camp Caiman deposit contains probable mineral
reserves of 12.3 million tonnes at a grade of 2.8 g Au/t, representing 1.1
million ounces in situ. This reserve base could be further enhanced by
regional exploration. The capital cost for the construction of the open-pit
mining project is estimated at $114.7 million, which breaks down as follows:

Summary of Capital Expenditure

|Description                         | (in millions of $)
|----------------------------------- | ------------------
|Infrastructure                      | 12.3              
|Mining equipment and pre-production | 22.7              
|Process plant                       | 26.3              
|Tailings and water management       | 8.0               
|Support facilities                  | 7.7               
|Indirects                           | 31.2              
|Subtotal                            | 108.2             
|Contingency                         | 6.5               
|Total                               | 114.7             

The construction schedule covers a period of 21 months
following completion of the financing arrangements and the obtaining of
operating permits, scheduled for the second quarter of 2006. We have also
applied for financial incentives under the "Loi Girardin", which could reduce
the capital cost by $30-35 million and are non-reimbursable provided we fulfill
certain obligations.

The capital cost could change depending on the timing of
construction release, the prices of commodities such as steel, and the
availability of equipment and construction manpower. The capital cost allows for
the transfer of certain equipment from the Omai gold mine.

We intend to fund the Camp Caiman development from our
internal cash resources, government incentives and an increase in the term
portion of our 2003 Credit facility.

The Camp Caiman production profile, based on the mineral
reserves, is as follows:

|Year  | Tonnage
    milled | Head
    grade | Ounces  | Direct
    costs
|----- | ------------------ | -------------- | ------- | ----------------
|      | (000 tonnes)       | (g Au/t)       |         | ($/oz.)         
|1     | 2,008              | 2.45           | 142,400 | 228             
|2     | 2,008              | 2.80           | 167,900 | 204             
|3     | 2,007              | 2.54           | 138,600 | 258             
|4     | 2,007              | 2.10           | 113,900 | 315             
|5     | 1,951              | 2.86           | 124,300 | 330             
|6     | 1,360              | 3.47           | 91,600  | 332             
|7     | 944                | 4.76           | 88,000  | 256             
|Total | 12,285             | 2.82           | 866,700 | 268             

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|18 | CAMBIOR 2005 ANNUAL REPORT
|-- | --------------------------

MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)

Camp Caiman Project (continued)

Summary of Capital Expenditure (continued)

During production, the mine is expected to employ
approximately 350 individuals.

It should be noted that Camp Caiman is eligible for a 10-year
corporate tax holiday under the original contract signed by a predecessor
company.

We plan to begin construction once we obtain the necessary
permits and authorizations, secure incentive funding under "Loi Girardin", and
finalize certain conditions related to regional levies.

Westwood Project

The Westwood project is located 2.5 kilometers east of the
Doyon mine. Following a surface drilling program that led to the discovery of
the Westwood deposit at between 1,000 and 2,000 meters below surface, we decided
to drive an exploration drift from the Doyon mine to provide a drilling base to
gain further information on the deposit and confirm the geological information
obtained by surface drilling. During 2005, we invested some $3.2 million in
Westwood, and we plan to invest a further $3.0 million in 2006 to continue the
exploration drift and conduct a 14,000-meter drilling program. The potentional
development of the Westwood orebody would benefit substantially from the
existing milling facilities and other infrastructure.

La Arena

The La Arena project is located in the Huamachuco region of
northeastern Peru, in an area that hosts several gold mining operations and
deposits. Cambior has extensive land holdings in the region totalling some
137,000 hectares.

Cambior discovered the La Arena mineralization in 1997 while
conducting grassroots exploration. The project was later put on hold when
exploration budgets were cut due to low metal prices, but was reactivated in
2003.

During 2005, 19,587 meters of drilling were carried out on
the La Arena oxydized gold deposit and the adjoining copper/gold porphyry. Based
on the results to date, we have initiated several studies in preparation for a
pre-feasibility study to be completed by mid-2006. Project outlays amounted to
$4.5 million in 2005, and additional outlays of $5.4 million are planned in
2006.

General

We intend to aggressively pursue increasing our resources and
reserves in 2006. We have allocated a 2006 exploration and development budget of
about $28.6 million. Exploration will remain focused on or near our existing
mine sites and advanced projects. Consequently, approximately $23 million of the
total budget is expected to be capitalized. This capitalized budget includes
expenditures for mine exploration and development drilling to increase reserves,
mainly at Rosebel ($6.5 million), La Arena ($5.4 million), Westwood ($4.1
million) and the Fennell deep target ($3.5 million). The remaining $5.7 million
will be spent on grassroots projects in Peru and in the Canadian and Guiana
shields.

We finance our exploration expenditures from internal cash
resources and, in the case of our Canadian exploration activities, through the
issuance of flow-through shares. Flow-through shares are usually issued at a
premium to market, as they allow the transfer of the tax deduction to individual
investors. Some of our Québec exploration programs benefit from financial
assistance from the Québec government. We also seek out strategic alliances to
increase our exposure to new discoveries.

---



|CAMBIOR 2005
    ANNUAL REPORT | 19
|------------------------------ | --

General and Administrative

Our increased activity level and additional regulatory compliance
requirements have resulted in a gradual rise in general and administrative
costs. The table below shows general and administrative costs for the past three
years.

|                                                              | 2005   | 2004   | 2003  
|------------------------------------------------------------- | ------ | ------ | ------
|General and administrative costs (G&A)
    (in millions of $) | 10.9   | 8.9    | 6.1   
|Revenues (in millions
    of $)                               | 368.5  | 300.9  | 193.9 
|G&A as % of revenues                                          | 3.0%   | 3.0%   | 3.1%  
|C$/US$ (yearly average)                                       | 1.2116 | 1.3015 | 1.4015

Our general and administrative costs are mainly denominated in Canadian
dollars and are therefore affected by the strengthening of the Canadian dollar
against the US dollar. Cost increases in 2005 were also attributable to the
initiation of the Sarbanes-Oxley 404 Internal Control Certification Process, and
higher stock exchange listing and maintenance fees. General and administrative
costs for 2006 are expected to be approximately $10.4 million.

Financial Expenses

Financial expenses amounted to $4.7 million in 2005, up $0.6 million from
2004 due mainly to an increase in the borrowing rate. In 2004, costs increased
significantly relative to 2003 as we expensed interest and political risk
premiums following the commencement of commercial production at Rosebel.

A summary of debt and interest is as follows:

|                                                        | 2005 | 2004 | 2003
|------------------------------------------------------- | ---- | ---- | ----
|Long-term debt  December 31 (in
    millions of $)     | 63.0 | 65.2 | 64.2
|Financial expenses (in
    millions of $)               | 4.7  | 4.1  | 1.9 
|Financial expenses 
    capitalized (in millions of $) | 0.7  | 0.5  | 1.4 
|Average LIBOR rate (%)                                  | 3.6  | 1.7  | 1.2 
|Average interest rate on credit
    facility (%)        | 5.0  | 4.1  | 4.3 

In 2006, financial expenses are expected to be similar to 2005 levels.

Impairment of Assets

In accordance with our accounting policy, we review the carrying value of our
assets on an annual basis. In our evaluation, we consider estimated future metal
production from a deposit, estimated future realized metal prices, operating,
capital and site restoration expenses and estimated future foreign exchange
rates. If we determine that the undiscounted cash flows of an operation are not
sufficient to recover its carrying value, we must record an impairment charge.
In determining the impairment charge, we must:



 Evaluate the recoverability of
related hedge commitments and include any loss as part of the impairment charge.

As part of the annual review, we determined that the following impairment
loss and restructuring costs related to the Doyon mine were required in 2004:

|(in millions of $)                                                        |     
|------------------------------------------------------------------------- | ----
|Impairment loss                                                           | 52.7
|Write-off of
    previously recorded deferred losses on hedging contracts | 4.3 
|Hedge derivative loss
    associated with Doyon contracts                 | 14.3
|Restructuring costs                                                       | 1.9 
|                                                                          | 73.2

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|20 | CAMBIOR 2005 ANNUAL REPORT
|-- | --------------------------

MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)

General (continued)

Impairment of Assets
(continued)

The impairment charge resulted from:

i)    
A reduction in reserves due to ground stability issues and increased operating
costs;

ii)   A
further increase in operating costs due to reduced economies of scale following
the lowering of the underground production rate from 1,000,000 tonnes per
annum to 700,000 tonnes per annum and to the strengthening of the
Canadian dollar against the US dollar; and

iii) 
Reorganization expenses of $1.9 million resulting from the layoff of 130
employees.

There were no impairment charges in 2005 or 2003.

Although the Doyon
and Sleeping Giant operations have experienced profitability challenges in 2005,
we were successful in implementing the required corrective measures. With the
positive effect of these measures and rising gold prices, we do not expect
further impairment charges to be necessary, assuming a long-term gold price of
C$620.

Stock-based Compensation Costs

In accordance with accounting policies for stock-based
compensation costs, we expensed the costs of options issued to directors and key
employees. We calculate this expense using the Black-Scholes option pricing
model, which is a widely-accepted method for valuing stock-based compensation.
In determining the valuation of the option price, we took 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                                           |      |      |     
|Weighted average fair value of options
    granted | $1.00 | $1.44 | $0.93

In 2005, the total stock-based compensation costs determined
under the fair value-based method of accounting was $1,595,000 (2004 
$1,580,000). The fair value of options exercised during 2005 totalled $262,000
(2004  $202,000) and was transferred from contributed surplus to common shares.

We did not recognize stock-based compensation costs on our
statement of consolidated operations prior to 2004. The cumulative effect prior
to 2004 has been recognized as a transfer of $15.7 million from the deficit to
the contributed surplus account.

Non-hedge Derivative Gain/Loss

We obtain a valuation of our portfolio of gold commitments
from a counterparty at each reporting period. This market valuation is based on
the forward rates and considers the market price, rate of interest, gold lease
rate and volatility. Forward transactions for which the quantity, price and
timing of delivery are fixed, are accounted for under the hedge accounting
method.

Transactions for which any key component (price, delivery
date, quantity) is uncertain do not meet the conditions of hedge accounting and
are treated as "non-hedge derivatives". Any variation in the mark-to-market
valuation of such transactions is included in the consolidated statement of
operations. This valuation can cause a significant variation in earnings for any
given period. Because we have decided to eliminate the use of optionalities,
which we account for as non-hedge derivatives, no significant accounting
adjustments related to mark-to-market fluctuations are expected to impact
earnings after 2004, resulting in significantly less impact on earnings.

---



|CAMBIOR 2005
    ANNUAL REPORT | 21
|------------------------------ | --

In conjunction with the sale of the Carlota Project, we are
scheduled to receive 50,000 ounces of gold in eight equal quarterly instalments
of 6,250 ounces commencing on March 31, 2006. In recording the sale proceeds at
closing, the fair value of the gold receivable was determined to be $23.6
million based on forward prices at the closing date and a 3% risk premium. As
the gold price was $489 per ounce on the closing date, we recognized both a
$24.5 million gold receivable and a related discount of $0.8 million. We will
record any fluctuation to the market price until final delivery as a non-hedge
derivative gain or loss. In 2005, the value of the gold receivable increased by
$1.2 million following a rise in the market gold price to $513 per ounce at
year-end.

The table below summarizes the mark-to-market valuations and
their impact on earnings in the various year-end periods.

|                                                                                      | Dec.
    31 | Dec. 31 | Dec. 31
|------------------------------------------------------------------------------------- | ----------- | ------- | -------
|                                                                                      | 2005        | 2004    | 2003   
|Estimated fair value of Cambior's gold
    forward sales and purchase commitments:    |             |         |        
|Forwards ($ millions)                                                                 | (20.5)      | (8.7)   | (59.7) 
|Forwards  Doyon future gold production included
    in the impairment                |             |         |        
|loss in 2004 and recognized on the balance sheet
    ($ millions)                     | (13.5)      | (14.3)  |       
|                                                                                      | (34.0)      | (23.0)  | (59.7) 
|Non-hedge derivatives recognized on the balance
    sheet ($ millions)                | 1.1         | 1.5     | (7.8)  
|Estimated mark-to-market value  revenue
    protection program ($ millions)          | (32.9)      | (21.5)  | (67.5) 
|                                                                                      |             |         |        
|                                                                                      | 2005        | 2004    | 2003   
|Impact on earnings of non-hedge
    derivative instruments ($ millions)               | (0.5)       | 9.3     | (1.4)  
|Loss arising from the
    exercise of call options sold and gold purchase commitments | 2.0         | (8.3)   | (1.1)  
|Gain resulting from
    lease rate swap contracts                                     |            | 1.5     | 3.1    
|Gain resulting from
    the variation in market prices of ounces of gold receivable   |             |         |        
|related to the disposal of the Carlota Project                                        | 1.2         |        |       
|Non-hedge derivative gain (loss)                                                      | 2.7         | 2.5     | 0.6    

Income and Mining Taxes

Cambior is subject to income and mining taxes in the
jurisdictions where it operates. These taxes are calculated based on
profitability and may, in some cases, include minimum taxes such as the tax on
large corporations in Canada. It should be noted that taxes are calculated at
the entity level and cumulated for consolidated financial reporting purposes.

In 2005, mainly due to Rosebel's strong performance, we
registered a future income tax expense of $13.6 million. In addition, we
recognized a recovery of $1.6 million in future mining tax in Canada. We also
recorded a Canadian mining tax recovery of $2.0 million in 2005, compared to
$0.5 million payable in 2004 and a recovery of $0.6 million in 2003.

We have significant cumulative tax losses and unrecognized
tax deductions, which are described in Note 20 to the consolidated financial
statements. The realization of these unrecorded tax assets is subject to
generating profit in the jurisdictions and/or corporations in which these losses
and deductions were incurred.

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|22 | CAMBIOR 2005 ANNUAL REPORT
|-- | --------------------------

MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)

Quarterly Review

The following table shows selected results by quarter for the last eight
quarters.

|                                        | First   | Second  | Third   | Fourth  |        | First   | Second  | Third   | Fourth  |      
|--------------------------------------- | ------- | ------- | ------- | ------- | ------ | ------- | ------- | ------- | ------- | -----
|                                        | quarter | quarter | quarter | quarter | Year   | quarter | quarter | quarter | quarter | Year 
|(unaudited)                             | 2004    | 2004    | 2004    | 2004    | 2004   | 2005    | 2005    | 2005    | 2005    | 2005 
|(in millions of $)                      |         |         |         |         |        |         |         |         |         |      
|Total revenues                          | 60.0    | 78.3    | 80.7    | 81.9    | 300.9  | 90.5    | 89.4    | 91.2    | 97.4    | 368.5
|Cash flow from
    operating activities | 7.8     | 9.6     | 16.9    | 3.7     | 38.0   | 11.2    | 11.3    | 11.2    | 6.8     | 40.5 
|Net earnings (loss)                     | 7.3     | 1.7     | (6.1)   | (76.7)  | (73.8) | 1.6     | 1.0     | (2.2)   | 19.8    | 20.2 
|Basic net earnings
    (loss)           |         |         |         |         |        |         |         |         |         |      
|per share ($)                           | 0.03    | 0.01    | (0.02)  | (0.28)  | (0.30) | 0.01    | 0.00    | (0.01)  | 0.07    | 0.07 
|Diluted net earnings
    (loss)         |         |         |         |         |        |         |         |         |         |      
|per share ($)                           | 0.03    | 0.01    | (0.02)  | (0.28)  | (0.30) | 0.01    | 0.00    | (0.01)  | 0.07    | 0.07 
|Basic weighted average number           |         |         |         |         |        |         |         |         |         |      
|of common shares                        |         |         |         |         |        |         |         |         |         |      
|outstanding (millions)                  | 241.0   | 241.8   | 244.5   | 269.9   | 249.3  | 274.2   | 274.3   | 274.4   | 274.5   | 274.3
|Effect of dilutive
    stock            |         |         |         |         |        |         |         |         |         |      
|options (millions)                      | 2.8     | 2.9     |        |        |       | 2.1     | 1.2     |        | 1.5     | 1.6  
|Effect of dilutive warrants (millions)  | 0.1     | 0.1     |        |        |       |        |        |        |        |     
|Diluted weighted average                |         |         |         |         |        |         |         |         |         |      
|number of common shares                 |         |         |         |         |        |         |         |         |         |      
|outstanding (millions)                  | 243.9   | 244.8   | 244.5   | 269.9   | 249.3  | 276.4   | 275.5   | 274.4   | 276.0   | 275.9
|Number of ounces of gold                |         |         |         |         |        |         |         |         |         |      
|produced (thousands)                    | 152     | 193     | 174     | 175     | 694    | 166     | 172     | 158     | 142     | 638  
|Mine operating costs ($/ounce)          | 240     | 226     | 263     | 251     | 244    | 269     | 273     | 314     | 286     | 285  

Fourth quarter earnings for 2004 and 2005 reflect unusual transactions,
including the Doyon impairment charge (-$71.2 million) in 2004 and the gain on
the sale of the Carlota project ($12.5 million) in 2005.

Consolidated Cash Flows

Operating Activities

Cash flow from operating activities amounted to $40.5 million in 2005, after
an investment of $13.6 million in working capital, compared to $38.0 million in
2004 and $24.2 million in 2003.

The increase is attributable to higher gold revenues. During 2005, the
investment in working capital was primarily due to an increase in receivables,
mainly from the bauxite operations, and higher supplies inventory. It should be
noted that cash flow from operating activities for each year excludes $12.2
million for the value of proceeds received under the prepaid gold forward sales
agreement in 2001, but for which we delivered 51,919 ounces per annum,
with the final delivery in December 2005.

---



|CAMBIOR 2005
    ANNUAL REPORT | 23
|------------------------------ | --

Investing Activities

During 2005, funds used in investing activities amounted to
$41.8 million, compared to $114.2 million in 2004 and $149.8 million in 2003. We
have been aggressively rebuilding our asset base since 2002 to compensate for a
period of low investment during the down cycle in commodity prices. In recent
years, our major capital projects were as follows:













The amounts invested were partially offset by the sale of the Carlota copper
project in late 2005. Our annual investments are summarized below:

|(in millions of $)                            | 2005   | 2004  | 2003 
|--------------------------------------------- | ------ | ----- | -----
|Canada                                        |        |       |      
|Doyon Division                                | 8.6    | 17.2  | 10.6 
|Sleeping Giant                                | 4.0    | 3.1   | 4.4  
|Acquisition of 50% interest in Sleeping Giant | 4.1    |      |     
|Omai                                          | (2.1)  | (4.0) | (1.5)
|Rosebel                                       | 27.9   | 41.9  | 87.1 
|Niobec                                        | 10.0   | 2.7   | 1.7  
|Sequoia acquisition                           |       | 42.0  |     
|Bauxite                                       | 19.9   | 10.3  | 0.8  
|Omai Services                                 | 6.2    |      |     
|French Guiana  Camp
    Caiman               | 6.2    | 7.7   | (2.0)
|Carlota  Disposition                         | (14.3) |      |     
|Carlota  Additions                           | 2.1    | 5.9   | 1.7  
|Projects and other                            | 6.9    | 6.2   | 4.4  
|Total                                         | 79.5   | 133.0 | 107.2

These investments should provide Cambior with a strong base to generate
increasing operating cash flow.

During the past years, we executed the following transactions:

Sale of the Carlota Copper Project  2005

From 2002 to 2005, we performed various studies to realize
value on the Carlota copper project, acquired in 1990. Following a review of
various alternatives, we decided to sell the project and use the proceeds to
fund the development of gold projects. We finalized the sale to Quadra Mining
Inc. on December 21, 2005 through the transfer of all the shares of Cambior USA,
Inc. and its wholly-owned subsidiary, Carlota Copper Company, for the following
consideration:

 $15 million in
cash received at closing;





The last four quarterly gold payments may be deferred should
the purchaser be unable to begin construction, but to a date no later than
December 31, 2010. We incurred expenses of $1.0 million to conclude the
transaction.

---



|24 | CAMBIOR 2005 ANNUAL REPORT
|-- | --------------------------

MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)

Consolidated Cash Flows (continued)

Investing Activities (continued)

Sale of the Carlota Copper Project  2005 (continued)

We accounted for the transaction as follows:

|(in millions of $)      |     
|----------------------- | ----
|Proceeds from disposal: |     
|Cash                    | 15.0
|Gold receivable         | 23.6
|                        | 38.6
|Less: transaction costs | 1.0 
|Net proceeds            | 37.6
|Carrying value          | 25.1
|Profit on disposal      | 12.5

At closing, the gold receivable was evaluated based on the
forward price at the closing date and a risk premium of 3%. The gold receivable
will be reviewed at each financial statement date, and any fluctuation in
valuation will be recorded in the income statement as a "non-hedge derivative
gain/loss".

Realization of the proceeds is dependent on the gold market
price and is subject to the purchaser's credit risk. We have secured our
receivable through various direct and indirect guarantees against the Carlota
project.

The contingent consideration was not included in the
determination of the proceeds of disposal. Any realization of this consideration
will be recorded as profit in the period determined.

As part of the transaction, we transferred the majority of
our US tax pools.

The transaction was net of income taxes due to the available
cost base.

Before selling the Carlota project, Cambior had invested $2.1
million in 2005, $5.9 million in 2004 and $1.7 million in 2003.

Consolidation of Ownership  Sleeping Giant Mine  2005

Effective April 30, 2005, we purchased the remaining 50%
interest in the Sleeping Giant mine for a cash consideration of $4.1 million
(C$5.2 million). The transaction was accounted for as an acquisition of assets.

The following table summarizes the fair value of the assets
acquired and liabilities assumed at the date of acquisition:

|(in millions of $)                                        |    
|--------------------------------------------------------- | ---
|Current assets                                            | 0.6
|Investments                                               | 0.8
|Property, plant and equipment                             | 6.0
|Total assets acquired                                     | 7.4
|Current liabilities                                       | 1.6
|Liability for asset retirement obligations
    and others | 1.7
|Total liabilities assumed                                 | 3.3
|Net assets acquired                                       | 4.1

---



|CAMBIOR 2005
    ANNUAL REPORT | 25
|------------------------------ | --

Consolidation of Ownership  Niobec Mine  2004

In July 2004, Cambior completed the acquisition of Sequoia
Minerals Inc., whose principal asset was a 50% interest in the Niobec mine.
Consequently, we increased our ownership to 100% in Niobec, a niobium producer
in operation since 1976 with more than 18 years of remaining reserves. Following
the acquisition, we assumed the operatorship of the mine and initiated an
expansion and optimization project necessitating investments of $5.6 million,
which was completed in 2005.

The acquisition of Sequoia Minerals Inc. can be summarized as
follows:

|(in millions of $)                                                                     |     
|-------------------------------------------------------------------------------------- | ----
|Current assets                                                                         | 13.0
|Investments                                                                            | 0.1 
|Property, plant and equipment                                                          | 58.2
|Future income tax assets                                                               | 0.1 
|Total assets acquired                                                                  | 71.4
|Current liabilities                                                                    | 5.0 
|Assumption of long-term debt                                                           | 14.1
|Assumption of debenture                                                                | 1.0 
|Asset retirement obligations                                                           | 0.8 
|Accrued benefit liability                                                              | 1.4 
|Future mining tax liabilities                                                          | 0.5 
|Total liabilities assumed                                                              | 22.8
|Net assets acquired                                                                    | 48.6
|                                                                                       |     
|Consideration                                                                          |     
|Disbursement                                                                           | 42.0
|Issuance of Cambior shares                                                             | 6.3 
|Conversion option on convertible debenture                                             | 0.3 
|Fair value of Sequoia common share purchase
    options converted into Cambior options | 0.0 
|                                                                                       | 48.6

Acquisition of the Camp Caiman Project  2003

In November 2003, we acquired the Camp Caiman advanced
exploration project through a merger transaction with Ariane Gold Corp. ("Ariane"),
a junior mining exploration company. The acquisition was in line with our desire
to increase our presence on the Guiana Shield to benefit from the expertise and
knowledge gained at Omai Gold and Rosebel. The transaction was accounted for as
an acquisition of assets, as follows:

|(in millions of $)                                                                    |      
|------------------------------------------------------------------------------------- | -----
|Cash and cash equivalents                                                             | 3.2  
|Current assets                                                                        | 0.2  
|Investment(1)                                                                         | (0.4)
|Property, plant and equipment  mining projects                                       | 49.6 
|Total assets acquired                                                                 | 52.6 
|                                                                                      |      
|Current liabilities                                                                   | 2.3  
|Assumption of long-term debt                                                          | 9.7  
|Total liabilities assumed                                                             | 12.0 
|Net assets acquired                                                                   | 40.6 
|                                                                                      |      
|Consideration                                                                         |      
|Issuance of Cambior shares                                                            | 39.2 
|Fair value of Ariane common share purchase
    options converted into Cambior options | 1.4  
|                                                                                      | 40.6 
|(1)We held shares in Ariane
    prior to the transaction.                             |      

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|26 | CAMBIOR 2005 ANNUAL REPORT
|-- | --------------------------

MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)

Consolidated Cash Flows (continued)

Short-term Investments

As part of our cash management strategy, we invest our excess
cash resources in short-term deposits and commercial papers with a maturity in
excess of 120 days. In accordance with accounting pronouncements, these are
classified as short-term investments. Short-term investments were reduced by
$33.8 million in 2005 and $32.9 million in 2004 and increased by $41.6 million
in 2003.

Investments

From time to time, we invest in marketable securities of other mining and
exploration companies that have the potential to complement our asset base.
These may be sold upon reaching certain valuation parameters or utilized as a
toehold for acquisition, as in the Ariane transaction.

Our investment generated $3.8 million in 2005, following the sale of
investments and the collection of residual proceeds from the sale of the El
Pachon copper project in 2001. In 2004 and 2003, these investments increased by
$14.2 million and $1.1 million respectively. As at December 31, 2005, the market
value of publicly-traded securities held in investment was $20.7 million,
compared to a carrying value of $14.1 million.

Financing Activities

During the past four years, we have strengthened our balance sheet to ensure
that we have the financial ability to develop our productive asset base. Mining
is a capital-intensive business that requires significant up-front capital to
develop productive assets and generate cash flow. In order to be successful, we
must maintain a positive relationship with the financial community to be able to
access temporary capital through bank loans and permanent capital through equity
offerings.

Issuance of Securities

We have taken advantage of renewed investor interest to strengthen our
balance sheet through various public offerings in recent years. The following
table shows our proceeds from share issues over the past three years:

|                                |        | 2005         |        | 2004         |        | 2003        
|------------------------------- | ------ | ------------ | ------ | ------------ | ------ | ------------
|                                | No. of |              | No. of |              | No. of |             
|                                | shares | Proceeds     | shares | Proceeds     | shares | Proceeds    
|                                | (000)  | ($ millions) | (000)  | ($ millions) | (000)  | ($ millions)
|Public offerings                |       |             | 29,333 | 87.8         | 40,000 | 72.2        
|Exercise and expiry of warrants |       |             | 150    | 0.1          | 24,754 | 44.0        
|Exercise of options             | 410    | 0.4          | 635    | 0.9          | 515    | 0.6         
|Flow-through shares             |       |             | 987    | 3.3          | 571    | 1.4         
|Total                           | 410    | 0.4          | 31,105 | 92.1         | 65,840 | 118.5       

In order to retain the interest of the capital markets, we
maintain an active investor relations program aimed at institutional and
individual investors. Our access to capital markets is mainly dependent on our
historical performance and future prospects, as well as investor interest in the
precious metals sector.

At February 20, 2006, the date of this MD&A, Cambior had
274,856,625 common shares outstanding.

---



|CAMBIOR 2005
    ANNUAL REPORT | 27
|------------------------------ | --

2003 Credit Facility

In 2003, we entered into a credit facility agreement (the
"2003 Credit facility") with a syndicate of international financial
institutions. The $65 million facility originally consisted of a term portion of
$55 million and a $10 million revolving line of credit. The term portion was
used to:

 Reimburse the outstanding balance
of the credit facility negotiated in 2001; and

 Fund the development of the
Rosebel project.

The term portion was reduced by $5 million in 2003 using the proceeds of a
share issue.

Under the 2003 Credit facility, the term and revolving facilities were to be
fully reimbursed by December 31, 2007. The repayment schedule was extended by
nine months in 2004 following the acquisition of Sequoia Minerals Inc.
Furthermore, we negotiated a $5 million increase in the revolving portion of the
facility in 2005. During the year, we made four quarterly reimbursements
totalling $18 million.

The quarterly repayment schedule for the term portion is as follows:

|(in millions of $) |     
|------------------ | ----
|2006               | 14.0
|2007               | 14.0
|2008               | 4.0 
|                   | 32.0

The revolving credit is to be fully reimbursed on September
30, 2008. We have not drawn on the facility to date, but have issued letters of
credit to guarantee certain corporate obligations amounting to $6.7 million,
which could call upon the facility.

In 2005, we also negotiated certain improvements to the
agreement governing the 2003 Credit facility.

We have pledged our interest in the Doyon, Mouska, Sleeping
Giant, Niobec and Rosebel mines as security under the loan. In accordance with
the agreement, we must maintain a number of financial and other covenants,
including:









As part of the facility agreement, the syndicate had
requested that we maintain a mandatory hedging program covering 30% of expected
gold production until the end of 2007. Following our C$100 million equity
financing in 2003, we obtained the elimination of the hedging covenant.

As part of the revised terms negotiated in 2005, the interest
margin on the credit facility is calculated at LIBOR plus a premium of 1.50% -
2.25%, with the premium being determined based on a ratio of net debt to EBITDA.

---



|28 | CAMBIOR 2005 ANNUAL REPORT
|-- | --------------------------

MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)

Financing Activities (continued)

Credit Facility  OBMI

To fund the refurbishment of the Linden bauxite operations,
OBMI secured a non-recourse $10 million credit facility at an interest rate of
10.5%, subject to review every three years. The facility has a 10-year term,
with no capital repayments during the first 24 months. Thereafter, the facility
is reimbursable in 32 equal consecutive quarterly instalments. OBMI is required
to maintain a debt service account of one principal and interest payment. The
facility was fully drawn in 2005.

We have entered into negotiations with the lender to increase
the facility to fund further improvements to OBMI's facilities.

Credit Facility  OSI

A non-recourse $8 million facility was obtained by Omai
Services Inc., a wholly-owned subsidiary of Cambior, to fund the power plant in
Linden that supplies power to OBMI. The facility is reimbursable in 36 equal
instalments commencing on June 30, 2006, and carries an interest rate of 10.5%
that is subject to review every three years.

Camp Caiman  Balance of Purchase

As part of the acquisition of the Camp Caiman project in
2003, we assumed a non-recourse debt of $9.7 million. An amount of $2.2 million
was repaid in 2004, with the remaining amount being payable in two equal
instalments, one in August 2006 and the other 120 days after commencement of
commercial production. As part of the purchase price allocation in 2003, the
amount due was discounted at a rate of 3%.

Prepaid Gold Forward Sales Agreement  Deferred Revenue

Under the terms of the $55.0 million prepaid gold forward
sales agreement (the "Prepaid Agreement"), Cambior undertook to deliver 233,637
ounces of gold in equal monthly instalments from July 2001 to December 2005. The
cash proceeds from the Prepaid Agreement were received in full in 2001 and were
accounted for as deferred revenue and presented under operating activities in
the consolidated statement of cash flows.

As per the terms of the Prepaid Agreement, we delivered
51,919 ounces of gold in each of the past three years valued at $235 per ounce.
The deliveries are presented as a deferred revenue deduction (non-cash item) in
our consolidated statement of cash flows.

The final delivery under the agreement was made on December
31, 2005.

General

We have been aggressively reducing our recourse debt and
financial obligations over the past two years. Should we be required to access
debt markets to fund project development such as Camp Caiman, we will ensure
that we maintain a prudent debt-to-equity ratio.

---



|CAMBIOR 2005
    ANNUAL REPORT | 29
|------------------------------ | --

Consolidated Balance Sheets

Total assets amounted to $621.3 million at December 31, 2005
compared to $590.4 million at the end of 2004. The $30.9 million increase in
2005 is mainly attributable to the investment in new projects funded by
non-recourse debt, recognition of a future income tax asset and profits earned
in 2005.

Property, plant and equipment totalled $454.9 million
compared to $398.8 million in 2004. This includes $76.3 million (16.8%) for the
total value of projects in the exploration and development stage, compared to
$62.5 million (15.7%) in 2004. Construction and development of these projects
are subject to the securing of financing for their development, favorable market
conditions for commodities and positive feasibility studies.

Cash and short-term investments decreased by $39.3 million
during the year to stand at $15.6 million at December 31, 2005. Receivables
increased by $19.3 million, mainly as a result of the increase in non-gold sales
by Omai Bauxite and Niobec, and the inclusion of the 25,000 ounces of gold
receivable in 2006 from the sale of Carlota. Working capital totalled $41.7
million compared to $49.9 million at December 31, 2004.

Long-term debt, including the $21.2 million due within one
year, amounted to $63.0 million at year-end, compared to $65.2 million at the
beginning of 2005.

The following table outlines the major outflows related to
debts or contractual obligations. These will be met through available cash
resources, operating cash flows and new debt in the case of outlays for OBMI.

|(in millions of $)                  | Total | 2006 | 2007 | 2008 | 2009+
|----------------------------------- | ----- | ---- | ---- | ---- | -----
|2003 Credit facility                | 32.0  | 14.0 | 14.0 | 4.0  |     
|Residual balances of purchase price | 9.4   | 4.9  | 0.7  | 3.8  |     
|Non-participating shares            | 1.4   | 0.5  | 0.5  | 0.4  |     
|Convertible debenture               | 1.2   | 1.2  |     |     |     
|Credit facility  OBMI              | 10.0  |     | 0.6  | 0.9  | 8.5  
|Credit facility  OSI               | 8.0   | 0.4  | 0.6  | 0.7  | 6.3  
|Capital Commitments                 | 5.5   | 5.5  |     |     |     
|Operating lease                     | 0.9   | 0.4  | 0.4  | 0.1  |     
|Other                               | 1.0   | 0.2  | 0.4  | 0.2  | 0.2  
|Total                               | 69.4  | 27.1 | 17.2 | 10.1 | 15.0 

Warrants issued in 2003 and 2004 may increase our capital
base by up to $115 million (C$139 million) through the issuance of 34.7 million
shares, provided they are exercised prior to their expiry in 2006 and 2008. The
exercise of warrants is primarily dependent on the share price at any given time
until they expire.

Under the 2003 Credit facility, we are restricted as to the
payment of dividends. We do not anticipate any dividend payment to shareholders
in the near term as we are reinvesting operating cash flows to rebuild our asset
base.

The fair value of non-hedge derivative instruments as at
December 31, 2005, was $1.1 million compared to $1.5 million at December 31,
2004.

Non-controlling interests relate to the minority partners'
interests in OBMI and Rosebel Gold Mines N.V.

In 2005, shareholders' equity rose by $26.7 million, due
primarily to earnings of $20.2 million in 2005 and a $4.6 million increase in
the cumulative translation adjustment account. In 2004, shareholders' equity
increased by $36.7 million.

The Canadian mines have been designated as self-sustaining
operations. Consequently, the translation adjustments arising from changes in
exchange rates are deferred and included in a separate component of
shareholders' equity. As the net investment in the Canadian operations
decreases, the related gain/loss in the foreign exchange will be recognized in
the income statement.

In 2005, we recognized a $742,000 gain on foreign exchange on
the reduction of our net investment in our Canadian operations. At December 31,
2005, we had an unrealized foreign exchange gain of $21.3 million (2004: $16.7
million) on our net investment in Canadian operations.

---



|30 | CAMBIOR 2005 ANNUAL REPORT
|-- | --------------------------

MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)

Shareholder Rights Plan

In November 2005, Cambior's Board of Directors adopted a
shareholder rights plan to encourage the fair treatment of shareholders in the
event of a take-over bid. The plan will provide the directors and the
shareholders more time to consider fully any unsolicited take-over bid. The
adoption of the plan is to be confirmed at Cambior's Annual and Special Meeting
of Shareholders in May 2006.

Environment

Cambior's activities are subject to various laws and
regulations regarding environmental protection, which are constantly evolving
and generally tend to impose increasing restrictions.

We have incurred, and expect to incur in the future, costs to
ensure compliance with these laws and regulations. When the legal obligation
associated with the retirement of long-lived assets is incurred, we recognize
the fair value of an estimated liability for the future cost of restoring a mine
site upon termination of operations with a corresponding increase to the
carrying value of the related long-lived asset. We amortize the added amount and
recognize 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. These provisions may be revised on
the basis of changes to the laws and regulations, and the availability of new
information and technology. Restoration and closure cost estimates are prepared
by knowledgeable individuals and are subject to review and approval by
government authorities. Site closure costs are charged against these provisions.

The undiscounted value of these obligations is currently
estimated as follows:

|(in millions of $)  |     
|------------------- | ----
|Doyon mine          | 30.3
|Omai gold mine      | 1.8 
|Rosebel mine        | 3.0 
|Omai bauxite mine   | 2.6 
|Niobec mine         | 2.3 
|Sleeping Giant mine | 2.6 
|Other mines         | 1.4 
|                    | 44.0

We expect to fund these expenditures from operating cash flows, sale of
residual equipment and accumulated deposits made with the government
authorities. The planned disbursements for these outlays are as follows:

|(in millions of $) | 2006 | 2007 | 2008 | 2009 | 2010 | 2011+ | Total
|------------------ | ---- | ---- | ---- | ---- | ---- | ----- | -----
|Outlays/year       | 8.4  | 5.3  | 12.0 | 5.0  | 6.7  | 6.1   | 43.5 

All of our mining operations except OBMI are certified under the ISO 14001
standard for environmental management.

---



|CAMBIOR 2005
    ANNUAL REPORT | 31
|------------------------------ | --

Community Development

Our operating strategy includes playing an active role in the
communities in which we operate. The economic impact of mining operations are
often more noticeable in emerging countries. Therefore, in such countries, we
try to introduce development programs that can be sustained beyond the mine life
and improve the quality of life of people living in the vicinity of our mines.
We have also established community outreach programs to dialogue with
stakeholders regarding our activities and their impact on the local communities.
We view community support for mining operations as a key ingredient for a
successful mining venture.

Employee Future Benefit Plans

We have several defined contribution and final-pay defined
benefit pensions plans, as well as other post-retirement benefit plans for our
employees. Our obligations under these plans require estimates as described in
Note 15 to the consolidated financial statements. These estimates are compiled
by professional advisors based on market assumptions and in accordance with
accepted practices. The total obligation is subject to change as these
assumptions are modified.

At December 31, 2005, we had a pension funding deficit of
$7.7 million, mainly related to a supplementary executive retirement plan for
senior executives (SERP). However, we have issued letters of credit of $6.2
million to the SERP's trustee to guarantee the unfunded obligations under
retirement compensation agreements.

Our obligations to fund are dependent on various factors,
including return on investments. In accordance with Québec legislation, our
plans are supervised by pension committees comprised of representatives of the
participants and of Cambior, as well as independent members. We have increased
funding of the registered pension plan to eliminate the current shortfall over a
five-year period. The SERP funding is totally discretionary and is subject to
ongoing review by the Board of Directors.

Mineral Reserves

Cambior's proven and probable mineral reserves at December
31, 2005, are outlined in this annual report. Mineral reserves were estimated by
qualified persons for each property in accordance with definitions and
guidelines adopted by the Canadian Institute of Mining, Metallurgy, and
Petroleum (CIM "Standards on Mineral Resources and Reserves") in August 2000.

Mineral reserve estimates are subject to change based on
variations in the price of gold and other commodities, further knowledge of the
ore deposit, mining conditions and methods of extraction.

A reduction in reserves can have a significant impact on the
valuation of the assets, which in most cases are amortized in accordance with
the reserve base.

---



|32 | CAMBIOR 2005 ANNUAL REPORT
|-- | --------------------------

MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)

Off Balance-sheet Transactions

As part of our 2001 financial restructuring, we were required
to implement a revenue protection program to secure the operating cash flows to
reimburse our credit facilities. The original requirement was 70% of production
up to December 31, 2005, at a minimum price of $290 per ounce. We implemented
this original program in September 2001. Subsequently, benefiting from a
stronger balance sheet, we reduced this covenant and ultimately eliminated it on
August 12, 2003.

Cambior has also established a policy of not hedging future
gold production unless required to do so for project financing. Over the past
years, we have aggressively reduced our gold sales commitments under the
mandatory hedging program.

We succeeded in gaining greater exposure to the gold price in
2006 and remain committed to the opportunistic buy-back of remaining positions
on gold price weaknesses.

In recent years, we have reduced our gold hedge commitment as
follows:

|                                                        | Ounces committed(1) | Variation from previous year
|------------------------------------------------------- | ------------------- | ----------------------------
|December 31, 2001                                       | 1,887,000           | -6%                         
|December 31, 2002                                       | 1,286,000           | -32%                        
|December 31, 2003                                       | 746,000             | -42%                        
|December 31, 2004                                       | 205,000             | -73%                        
|December 31, 2005                                       | 165,000             | -20%                        
|(1) Including
    prepaid gold forward sales agreement.

We also eliminated all call option obligations and lease rate
swaps in 2004.

At December 31, 2005, we had delivery obligations of 165,000
ounces of gold. The fair value of the gold delivery commitments was negative
$32.9 million. This negative mark-to-market value is somewhat offset by the gold
receivable under the Carlota sale agreement, which had an estimated market value
of $24.9 million at December 31, 2005. The details of the hedging portfolio are
included in Note 21 to the consolidated financial statements.

Hedging Program  Foreign Exchange Contracts

All of our production sales are in US dollars. We enter into
foreign exchange contracts from time to time to meet our Canadian dollar
requirements to fund our operating activities in Canada. Forward sales
commitments of $5.5 million for the purchase of Canadian dollars in 2005 are
outlined in Note 21 to the consolidated financial statements.

Following the merger with Ariane in late 2003, we began to
incur expenditures in Euros. Our exposure to the Euro will increase as we expand
our activities in French Guiana. From time to time, we may reduce the volatility
of our exposure through a currency hedging program.

Hedging Program  Other

We are also exposed to fluctuations in oil prices and
interest rates. We review this exposure on a regular basis and may enter into
transactions to fix the costs of these items. At December 31, 2005, no contracts
were outstanding for oil or interest rate coverage.

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|CAMBIOR 2005
    ANNUAL REPORT | 33
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Human Resources

Much of our success today can be attributed to having a
passionate workforce that cares about our reputation. Employees are proud of
their history and their contribution to Cambior. Management invests a
considerable amount of time in recruiting competent and skilled people that fit
demanding selection criteria. Although maintaining the skills of a professional
workforce requires a significant amount of time and energy, we consider employee
development to be an integral part of our continuous improvement program. Each
year, we invest close to 3% of payroll on employee development to ensure that
skills are in line with new safety standards, changing technology and improved
processes. Improved commodity prices combined with an aging workforce in North
America have increased the demand for experienced mining professionals and
workers. The successful execution of our development and operating plans depends
on the availability of the necessary human resources.

To maintain a motivated workforce, we offer a challenging and
rewarding work environment as well as a competitive compensation program
comprising salary and benefits. We also maintain a staff development and
succession program for key executive and operational management positions.

As part of our compensation program, we offer an employee
share purchase plan in which approximately 520 individuals participate.
Approximately 1% of the outstanding shares of Cambior are held by directors,
officers and employees. We have also granted 8.2 million options to acquire
common shares of Cambior, as described in Note 17 to the consolidated financial
statements, to key employees to align their interests with those of the
shareholders. These options vest over a three-year period and have a seven-year
life, thereby encouraging these employees to have a long-term view of Cambior's
development.

We have also introduced various innovation and continuous
improvement initiatives since 2001 to enhance productivity and cost
competitiveness.

All of Cambior's current operations except for Rosebel and
OBMI are unionized. The Rosebel hourly employees have presented a demand for
union certification to the Republic of Suriname. A union representing the OBMI
hourly and clerical employees has been recognized by the Co-operative Republic
of Guyana, and a first collective agreement should be signed in 2006. We will
also be negotiating a new labour agreement at Doyon in 2006.

Management considers that it has good relations with the
employees and unions. Cambior offers a competitive compensation program, a
secure and challenging working environment, and an open dialogue.

The expiry dates of the collective agreements are as follows:

|Omai  Hourly employees                                            | February 28, 2007
|------------------------------------------------------------------ | -----------------
|Doyon  Hourly employees                                           | November 30, 2006
|Mouska  Hourly employees                                          | October 17, 2007 
|Sleeping Giant  Hourly employees                                  | July 31, 2007    
|Niobec  Hourly, clerical and technical employees                  | April 30, 2008   
|                                                                   |                  
|At year end, Cambior employed
    approximately 2,700 individuals.

Litigation

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 $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 previously filed actions without success in both Québec and Guyana. Cambior
and OGML consider this action unfounded and frivolous and OGML is contesting it
vigorously. The net assets of OGML amount to $12.4 million.

OGML has a rigorous and extensive water monitoring program that demonstrates
full compliance with environmental regulations in Guyana based on Guyanese,
Canadian, American and World Bank standards. Furthermore, Guyana's Environmental
Protection Agency and the Guyana Geology and Mines Commission ensure independent
monitoring of OGML's compliance regarding the Essequibo River.

We are also subject to various claims, legal proceedings, potential claims
and complaints arising in the normal course of business, as well as to the
possibility of new income and mining tax assessments for prior years. We do not
believe that unfavorable decisions in any of the pending procedures or threat of
procedures related to any future assessment or any amount we might be required
to pay will have a negative impact on our financial condition.

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|34 | CAMBIOR 2005 ANNUAL REPORT
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MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)

Risks and Uncertainties

Cambior is subject to various financial, operational and
political risks that could have a significant impact on profitability and levels
of operating cash flow, as described below.

Financial Risks

The following summarizes key financial risks:

Commodity Prices

Our revenues depend on the market prices for our mine
production. The gold market is highly volatile and is subject to various factors
including political stability, general economic conditions, mine production, and
intent of governments who own significant above-ground reserves.

The niobium marketplace is characterized by a dominant
producer whose actions may affect the price. New entrants may affect the
stability of the marketplace by engaging in a price discounting practice to gain
initial market share. General economic conditions, particularly in the steel
industry, also affect the marketplace.

The RASC market is subject to competition from Chinese
suppliers who can affect OBMI's competitive position due to their reduced labour
costs and transportation cost savings.

Oil prices also affect our costs, particularly at Omai
Bauxite and Rosebel due to the oil cost components of the power supply and fuel
for the open-pit mining fleet.

All of the factors that determine gold, niobium, RASC and oil
prices are beyond our control. We do not take any particular measures to protect
ourselves against fluctuations in the commodities markets. In fact, we have
chosen to increase our exposure to the gold market in particular by reducing our
hedging positions, as we feel that the gold price will remain strong in the
foreseeable future.

Currency

Cambior's metal sales are transacted in US dollars. Movement
in the Canadian dollar against the US dollar therefore has a direct impact on
our Canadian division and executive office cost base. International operations
have limited exposure to currency as the cost base is mainly denominated in US
dollars. From time to time, we enter into foreign exchange contracts to fix the
exchange rate.

The Canadian currency rate may also have an impact on our
access to permanent capital, which has traditionally been raised in Canadian
dollars through transactions on Canadian equity markets. The amount of dilution
following equity issues may be affected by the amount required in foreign
currency.

Interest Rates

As a borrower, Cambior is subject to movement in US interest
rates. Consequently, we have traditionally negotiated US dollar borrowings with
interest rates based on the LIBOR rate.

Counterparty Risk

We have a number of counterparty risks in our financial
transactions for gold sales and foreign exchange contracts. In order to minimize
such risks, we transact within our lending group.

Access to Capital Markets

To fund growth, we are often dependent on securing the
necessary capital through loans or permanent capital. The availability of this
capital is subject to general economic conditions and lender and investor
interest in Cambior and our projects. To ensure the availability of capital, we
maintain a relationship with key financial participants and have implemented an
investor relations program to inform institutional and retail investors, as well
as other stakeholders.

Insurance

Where economically feasible and based on availability of
coverage, we transfer a number of operational and financial risks to insurance
companies. The availability of such insurance is dependent on our past insurance
loss records and general market conditions. More recently, major losses incurred
by insurance markets have reduced capacity and affected rates.

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|CAMBIOR 2005
    ANNUAL REPORT | 35
|------------------------------ | --

Operational Risks

Mining is subject to various operational risks and
uncertainties, including:

Mineral Reserves and Extraction

Reserves are an estimate of mineral content based on limited
information acquired through drilling and other sampling methods. Successful
extraction is based on safe and efficient mining and processing. Our mines may
suffer rockbursts, groundfalls and other natural or man-provoked incidents that
could affect the mining of the ore. To minimize the risks, we estimate reserves
in accordance with accepted guidelines and standards within the mining industry,
establish quality control programs and ensure that competent personnel are
employed. We also employ experienced mining engineers and a trained workforce to
extract the ore from our deposits.

Safety and Other Hazards

The mining industry is characterized by significant risks. To
minimize these risks, we provide training programs for our employees and have
joint management-worker committees to review work practices and environment.

Energy

Our operations consume significant amounts of energy, and are
dependent on suppliers to meet these energy needs. In some cases, no alternative
source of energy is available.

Labour and Strikes

We are dependent on our workforce to extract and process
minerals. We have programs to recruit and train the necessary manpower for our
operations, and endeavour to maintain good relations with our workforce in order
to minimize the possibility of strikes, lockouts and other stoppages at our work
sites.

Communities

Surrounding communities may affect the mining operations
through the restriction of access of supplies and workforce to the mine site. We
maintain active community outreach and development programs to mitigate the risk
of blockades or other restrictive measures by the communities.

Environmental Hazard

We are vulnerable to various environmental incidents that can
have a significant impact on our operations. To mitigate these risks, we have
implemented an ISO 14001-certified environmental management system that covers
all aspects of the mining cycle. In high-risk areas, such as the design and
operation of tailings dams, we contract independent review boards to oversee
design and ongoing operating practices. We also have emergency plans to deal
with any incidents.

Political Risk

Our operations, particularly those located in emerging
countries, are subject to a number of political risks. In accordance with our
lending agreements, we carry political risk insurance to cover certain risks.

Our operations in Guyana and Suriname are governed by mineral
agreements that establish the terms and conditions under which we conduct our
affairs. These agreements are subject to international arbitration and cover a
number of items, including:

1)

2)

3)

4)

5)

6)

We maintain active communications programs with host
governmental authorities and the Canadian government.

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|36 | CAMBIOR 2005 ANNUAL REPORT
|-- | --------------------------

MANAGEMENT'S DISCUSSION AND ANALYSIS (continued)

Risks and Uncertainties
(continued)

Operational Risks (continued)

Legislation

We are subject to continuously evolving legislation in the
areas of labour, environment, land titles, mining practices and taxation. New
legislation may have a negative impact on our operations. We participate in a
number of industry associations to monitor changing legislation and maintain a
good dialogue with governmental authorities in that respect.

Critical Accounting Estimates

We are required to make certain estimates that have a
significant impact on the financial statements. The following are estimated
items that management considers most critical, and for which actual amounts
could differ substantially and affect the results of operations.

Mineral Reserves

The key operating parameters used to determine mineral
reserves were:

|              | 2005 | 2004 | 2003
|------------- | ---- | ---- | ----
|Gold ($/oz.)  | 425  | 400  | 350 
|Copper ($/lb) |     | 1.00 | 0.90
|C$/US$        | 1.35 | 1.35 | 1.40

Property, Plant and Equipment

We begin capitalizing the cost of a mining property when we
believe it has mineral resources with the potential to be economically
recoverable. Construction and development costs incurred thereafter are
capitalized and amortized based on the useful life of the asset, which in most
cases is based on the ore reserves of the deposit. Ore reserves are estimated by
professional geologists and engineers in accordance with industry standards
which require input as to future metal prices, operating costs and technical
parameters. Annual asset impairment tests are carried out using these parameters
and estimated salvage value for equipment. Changes in any key input component
could result in a significant reduction in mineral reserves, which would in turn
have a negative impact on the carrying value of the property, plant and
equipment.

Litigation

We are subject to various litigation actions, including the
OMAI Gold Mines Ltd. lawsuit, whose outcome could have an impact on Cambior's
valuation should we be required to make payments to the plaintiffs. In-house
counsel and outside legal advisors assess the potential outcome of the
litigation and we establish provisions for future disbursements when required.

Site Restoration (Asset Retirement Obligations)

We establish estimates for future restoration costs following
the depletion of ore reserves. These estimates are dependent on labour costs,
known environmental impacts and the effectiveness of remedial and restoration
measures. We also estimate the timing of the outlays, which are subject to
change depending on continued exploitation of current or newly-discovered
reserves.

Employee Future Benefits

We are required to make certain assumptions with respect to
returns on pension assets and our employees' future earnings and mortality
rates. Any variation could affect the requirements to discharge future
compensation payments.

Valuation of Consideration

We may grant options as part of employee remuneration or as
part of consideration in the acquisition of assets. We use the recognized Black-Scholes
model to value these options. The model requires certain inputs that require
management estimates.

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|CAMBIOR 2005
    ANNUAL REPORT | 37
|------------------------------ | --

Changes in Accounting Policies

Stock-based Compensation

On January 1, 2004, we adopted new Canadian standards for
stock-based compensation and other stock-based payments. The amendments require
that options granted to employees be accounted for at fair value in the
financial statements, which was not previously the case.

Asset Retirement Obligations

On January 1, 2004, we adopted new Canadian standards for
asset retirement obligations. The new standards apply to the recognition and
measurement of a liability for an asset retirement obligation and the associated
asset retirement cost.

Flow-through Shares

In 2004, we adopted a new accounting pronouncement relating
to flow-through shares. This resulted in the recognition of a future income tax
liability of $1,219,000 in 2004, offset by a corresponding amount in
previously-incurred, unrecognized tax losses.

Outlook

During 2006, we will continue to execute on our strategic
plan to deliver value to our shareholders by:









Our 2006 production
target is 529,000 ounces at a mine operating cost of $294 per ounce. The
forecast decrease in production is mainly the result of the shutdown of the Omai
gold operations in September 2005 following the depletion of its ore reserves.
Sales of ferroniobium from Niobec are expected to increase by 17% in 2006 to $60
million, while sales of calcined bauxite are expected to increase to $64
million. We intend to reinvest $103 million at our operating mines and our
mining projects, mainly on the development of the future Camp Caiman mine.

Additional Information and Continuous Disclosure

This MD&A has been prepared as of February 20, 2006.
Additional information on Cambior is available through regular filings of press
releases, quarterly financial statements and our Annual Information Form on
SEDAR (www.sedar.com).

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