il 2009 April 2009 A Cautionary Statements CAUTIONARY NOTE - - PDF document

il 2009 april 2009 a cautionary statements
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il 2009 April 2009 A Cautionary Statements CAUTIONARY NOTE - - PDF document

il 2009 April 2009 A Cautionary Statements CAUTIONARY NOTE REGARDING FORWARD LOOKING-STATEMENTS This presentation contains forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995


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SLIDE 1

A il 2009 April 2009

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SLIDE 2

Cautionary Statements

CAUTIONARY NOTE REGARDING FORWARD LOOKING-STATEMENTS

This presentation contains “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities legislation. Forward-looking statements include but are not limited to statements with respect to the future price of silver the estimation of mineral reserves and resources the realization of mineral Forward looking statements include, but are not limited to, statements with respect to the future price of silver, the estimation of mineral reserves and resources, the realization of mineral reserve estimates, the timing and amount of estimated future production, costs of production, reserve determination and reserve conversion rates. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates”

  • r “does not anticipate”, or “believes”, or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “occur” or “be

achieved”. Assumptions upon which such forward looking statements are based include that Silver Wheaton and Silverstone will be able to satisfy the conditions in the definitive agreement, that the due diligence investigations of each party will not identify any materially adverse facts or circumstances, that the required approvals will be obtained from the shareholders of each of Silver Wheaton and Silverstone, that all third party regulatory and governmental approvals to the transactions will be obtained and all other conditions to completion of the transaction will be satisfied or waived. Many of these assumptions are based on factors and events that are not within the control of Silver Wheaton and Silverstone and there is no assurance they will prove to be correct. Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Silver Wheaton and Silverstone to be materially different from those expressed or implied by such forward-looking statements, including but not limited to: risks related to the integration of acquisitions, the absence of control over mining operations from which Silver Wheaton and Silverstone purchase silver and gold and risks related to these mining operations, including risks related to international operations, actual results of current exploration activities, actual results of current reclamation activities, conclusions of economic evaluations, changes in project parameters as plans continue to be refined, as well as those factors discussed in the section entitled “Description of the Business – Risk Factors” in Silver Wheaton’s annual information form for the year ended December 31 2008 incorporated by reference into Silver Wheaton’s Form 40 F on file with the U S Securities and Exchange Commission in Washington D C and form for the year ended December 31, 2008 incorporated by reference into Silver Wheaton s Form 40-F on file with the U.S. Securities and Exchange Commission in Washington, D.C. and although Silver Wheaton and Silverstone have attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Silver Wheaton and Silverstone do not undertake to update any forward-looking statements that are incorporated by reference herein, except in accordance with applicable securities laws.

CAUTIONARY NOTE TO U.S. INVESTORS CONCERNING ESTIMATES OF MEASURED, INDICATED AND INFERRED RESOURCES

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

1

Full details on Silver Wheaton reserves and resources for Luismin, Zinkgruvan, Yauliyacu, Peñasquito, Stratoni, Mineral Park, Campo Morado, La Negra, and Keno Hill can be found on the Company website at www.silverwheaton.com.

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SLIDE 3

A Unique Silver Company

  • Largest silver streaming company in the world
  • Recently announced acquisition of Silverstone Resources Corp. solidifies this position*
  • Significant leverage to silver price
  • 10% increase in silver price results in a 16% increase in 2009 cash flow**
  • Very strong growth potential

Very strong growth potential

  • +100% organic sales volume growth by 2010 (not including Silverstone acquisition)
  • Significant stake in 6 of the top 35 silver deposits in the world
  • Well positioned to make further accretive acquisitions

Well positioned to make further accretive acquisitions

  • Strong financial position
  • Recently completed a C$287m equity financing
  • US$400m undrawn debt facility available

US$400m undrawn debt facility available

  • Significant downside protection
  • Model eliminates many key risks faced by traditional mining companies
  • Experienced management team with demonstrated track record of

2

  • Experienced management team with demonstrated track record of

creating shareholder value

* Scheduled to close in the second quarter of 2009 ** Assumes a silver price of $13/oz

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SLIDE 4

Largest Silver Streaming Company

  • Unrivaled growth profile
  • Forecast annual silver sales of 15 to 17 million ounces in 2009, increasing to

approximately 30 million ounces by 2013 (not including Silverstone acquisition)

  • Very high Operating Margins
  • Very high Operating Margins
  • >60% for the year ended December 31, 2008
  • Nine long term agreements with established producers:
  • Nine long term agreements with established producers:
  • Goldcorp, Glencore, Lundin Mining, European Goldfields
  • Reserves and resources of more than 1 Billion silver ounces*

Reserves and resources of more than 1 Billion silver ounces

  • No hedging

3

* P&P reserves totaling 430 million ounces of silver, M&I resources totaling 214 million ounces of silver, Inferred resources totaling 393 million ounces of silver

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SLIDE 5

Mine Locations

S i Zinkgruvan Mineral Park Keno Hill Stratoni Peñasquito Luismin Campo Morado La Negra Yauliyacu

Development Projects Operating Mines

4

p j

* Not including Silverstone acquisition

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SLIDE 6

100% of Revenue from Silver Production

100% 100% 78% 78% 61% 70% 80% 90%

  • f Total

61% 57% 51% 42% 40% 50% 60% venue as a % o 20% 30% 40% Silver Rev 0% 10% Silver Wheaton* Coeur D'Alene* Pan American Silver* Hochschild* Fresnillo* Silvercorp** Hecla*

5

* For Year ended 12/31/08 ** For 9 Months ended 12/31/08 Source: Company Reports, Not including Silverstone acquisition

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SLIDE 7

Silver Sales Growth - No Further CAPEX To Be Paid*

30 20 25

+100%

  • z)

15

er Sales (M o

5 10

Silve

2004 2005 2006 2007 2008 2009E 2010E 2011E 2012E 2013E

Luismin Penasquito Yauliyacu Zinkgruvan Stratoni Mineral Park, Campo Morado, q y g , p , La Negra, Keno Hill

6

* A US$35M payment is due to Alexco once project permits are received ** Not including Silverstone acquisition

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SLIDE 8

Current Attributable Reserves & Resources

1800 1200 1400 1600 (M oz) 800 1000 1200

Inferred M&I Resource

ned Silver 200 400 600

P&P Reserves

Contain 200

Hecla* Pan American* Coeur* Fresnillo** Silver Wheaton* Silver Standard***

7

* As of Dec 31, 2008 ** As of Dec 31, 2007 *** As of Feb 3, 2009 Source: Company Reports, Not including Silverstone acquisition

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SLIDE 9

Best Leverage to Silver Price - Performance Since Inception

500% 600% 300% 400% 500%

SLW

Silver PAAS SSRI

0% 100% 200%

PAAS HL CDE

  • 200%
  • 100%

0% 4 5 5 5 5 6 6 6 6 7 7 7 7 8 8 8 8 9 9

  • Share price has significantly outperformed peers since inception in Oct. of

2004

Oct-04 Jan-0 Apr-0 Jul-0 Oct-0 Jan-0 Apr-0 Jul-0 Oct-0 Jan-0 Apr-0 Jul-0 Oct-0 Jan-0 Apr-0 Jul-0 Oct-0 Jan-0 Apr-0 8

Source: Thomson One, as of April 10, 2009

2004

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SLIDE 10

Silver Wheaton vs Silver ETF

SILVER WHEATON Silver ETF Pure Silver Best Leverage to Silver Price Organic Growth Further Growth Potential

9

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SLIDE 11

Top 35 Silver Deposits in the World

Producing Mines and Development Projects

2,000

Producing Mines and Development Projects

Silver Wheaton Relationship (6) Sil St d d (2)

1 200 1,400 1,600 1,800 ves (Moz)

Silver Standard (2) 25% of Peñasquito

600 800 1,000 1,200 rces & Reserv 200 400 600

G T C 2

Resour

Penasquito Pascua-Lama Pitarrilla Glogow Rudna Polkowice Grasberg Lubin Cannington Navidad Dukat Mt Isa George Fisher Antamina Toromocho Codelco 25% of Penasqui Mehdiabad Fresnillo Udokan San Cristobal Olympic Dam Bawdwin Corani Malku Khota Maverick Springs Zhezkazgan Veladero Hackett River Sunshine Pirquitas McArthur River Montanore Rock Creek San Dimas to s

10

Source: Intierra

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SLIDE 12

Significant Downside Protection

  • Operating costs are essentially fixed:
  • US$3.90/oz silver with small inflationary adjustment

US$3.90/oz silver with small inflationary adjustment

  • Revenue derived from low cost and long life mining operations
  • No ongoing capital expenditures or exploration costs

No ongoing capital expenditures or exploration costs

  • Yet SLW benefits from production/exploration growth
  • Structured to minimize income taxes
  • No environmental/closure responsibilities
  • Structured not to lose cash flow
  • Silver purchase price is the lesser of the spot price or US$3.90/oz
  • No currency risk

11

  • Very low political risk
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SLIDE 13

Fixed Operating Costs – Significant Upside Potential

$16.00

Silver Wheaton's Realized Silver Price vs. Cash Costs

$12.00 $14.00 $8.00 $10.00 $'s per ounce $4.00 $6.00 US$

Cash Margin Per Ounce

$0.00 $2.00 2004 2005 2006 2007 2008 2004 2005 2006 2007 2008 Realized Silver Price T

  • tal Cash Cost

12

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SLIDE 14

Revenue Derived from Low Cost and Quality Assets Assets

2009 Forecast Silver Sales 2013 Forecast Silver Sales

Luismin 33% Zinkgruvan 7% Stratoni 6% Other 11% Luismin 37% Stratoni 10% Other 11% Penasquito Yauliyacu 14% 7% Penasquito 9% Yauliyacu Zinkgruvan 12%

  • 79% of 2009 revenue derived from four mines – Luismin, Peñasquito,

Penasquito 29% Yauliyacu 21%

Yauliyacu and Zinkgruvan (not including Silverstone acquisition)

  • Luismin, Yauliyacu and Zinkgruvan have been in continuous production for over 100

years and are low cost producers

13

  • Peñasquito to become next ‘flagship’ asset – adds significant growth
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SLIDE 15

Commodity Exposure – Well Diversified

2009 Commodity Exposure* 2013 Commodity Exposure*

Zinc 31% Gold Gold 62% Silver Gold 46% Zinc 49% Copper 4% Silver 3% Copper 5%

  • With its current agreements, Silver Wheaton is well diversified and its

exposure to gold increases over time

14

* Figures are based on Silver Wheaton’s forecast silver sales and do not include the Silverstone acquisition

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SLIDE 16

Very Low Political Risk

Geographic Distribution of Reserves and Resources

8% 6% 2% 13%

Mexico Peru USA

71%

USA Sweden Greece Canada

15

* Not including Silverstone acquisition

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SLIDE 17

Financial Performance

$0.60 $0.40 $0.50 $0.20 $0.30 $0.00 $0.10 2004 2005 2006 2007 2008 EPS CFPS

  • 52% annualized growth in cash flow per share for period 2005 through

2008

16

  • 2008 adjusted EPS before non-cash write-down of long-term investments

2008

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SLIDE 18

Growth in Reserves and Resources - since inception

1,200 600 800 1,000

  • ns of oz)

200 400 600 Silver (millio 200 2004 2005 2006 2007 2008

  • 58% annualized growth in P&P reserves and 43% annualized growth in

total reser es and reso rces since inception

Reserves Measured & Indicated Inferred 17

* Not Including Silverstone acquisition

total reserves and resources since inception

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SLIDE 19

Growth in Reserves and Resources Per Share* - since

inception

4.50 3.00 3.50 4.00 hare 1.50 2.00 2.50 Silver oz/sh 0.00 0.50 1.00

  • 29% annualized growth in reserves and resources per share since inception

2004 2005 2006 2007 2008 Reserves Measured & Indicated Inferred 18

* Not Including Silverstone acquisition

29% annualized growth in reserves and resources per share since inception

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SLIDE 20

Projected EBITDA Existing Agreements*

$20/oz $400 $500 ns) $10/oz $15/oz $200 $300 S$ (million $10/oz $0 $100 US 2009 2010 2011 2012 2013 2014

19

* Not including Silverstone acquisition

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SLIDE 21

Debt Sensitivity*

Debt Repayment By $15/oz

)

Debt Repayment By $10/oz

Price (US$)

$8/oz

Silver P

Dec-08 Dec-09 Dec-10 Dec-11

20

* Not including Silverstone acquisition

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SLIDE 22

Capital Structure - As of March 12, 2009

Shares Outstanding 287.5 million g

SLW.WT Warrants 2.9 million* exercise @ C$ 4.00 SLW.WT.A Warrants 0.6 million* exercise @ C$ 5.50 SLW.WT.B Warrants 7.8 million exercise @ C$10.00 SLW.WT.U Warrants 2.7 million exercise @ U$20.00 Options 3.6 million avg.exercise @ C$10.48

Shares Fully Diluted 305.1 million 3 M h A D il V l 3 Month Avg. Daily Volume TSX: 2.8 million shares NYSE: 8.8 million shares

21

* Consolidated based on 0.2 SLW.WT and SLW.WT.A for every common share of SLW ** Not including Silverstone acquisition

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SLIDE 23

Relative Valuations – Undervalued?

NAV Multiple

Royalty-type Structure Senior Gold Mid-Tier Gold Silver/PGM Averages

22

Source: Bank of America Securities - Merrill Lynch, April 6, 2009 g

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SLIDE 24

Unparalleled Growth

23

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SLIDE 25
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SLIDE 26

Peñasquito

  • Goldcorp’s world-class gold-zinc-

silver lead deposit in Mexico

  • Positive deep drilling shows

underground potential silver-lead deposit in Mexico

  • Largest silver deposit in the world

underground potential

  • Heap leach operation commenced

production in Q2 2008

  • Reserves and Resources (Dec 2008)
  • P&P Reserves: 1,046 M oz
  • M&I Resources: 370 M oz

p Q

  • Initial mill production expected in

mid-2009

  • M&I Resources: 370 M oz
  • Inferred Resources: 395 M oz
  • Updated feasibility study anticipated
  • 30% boost in mill throughput over

2006 feasibility Updated feasibility study anticipated in early 2009

  • Continued excellent potential for

25

exploration growth

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SLIDE 27

Peñasquito - Transaction Terms

  • 25% of silver production for the

lif f i

  • Goldcorp completion guarantee

life of mine

  • Upfront cash payment of US$485

illi

  • No significant tax is to be paid by

Silver Wheaton million

  • Purchase price is the lower of

US$3 90/ t il i

  • 25% interest in Peñasquito

would rank as one of the top 20 il d it i th ld US$3.90/oz or spot silver price silver deposits in the world

26

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SLIDE 28

Peñasquito Project Growth - Since Our Acquisition, April 2007

April 2007 Current* Growth Silver Reserves/Resources

P&P Reserves

575 M oz 1,046M oz

+82%

M&I Resources

247 M oz 370 M oz

+50%

M&I Resources

247 M oz 370 M oz

+50%

LOM Silver Production Attributable to SLW (25%)

92 M oz 140 M oz

+52%

( %) Average Annual Silver Sales Attributable to SLW (25%)

5.4 M oz 7.8 M oz

+44%

Anticipated Mine Life

17 yrs 19 yrs

+12%

Underground Potential

Not contemplated Yes

+%??

27

p

%??

* Reserves and Resources as of Dec 31, 2008, remaining data based on Dec 31, 2007 Technical Report

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SLIDE 29

WHERE ARE WE GOING?

28

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SLIDE 30

Additional Acquisition Opportunities

  • Significant silver stream opportunities going forward:
  • Operators and developers facing growing capital requirements
  • M&A activity resulting in financing needs
  • Challenges in securing traditional sources of financing
  • 70% of mined silver is produced as a by-product

T i i i i i i i h ff

  • Targeting accretive acquisition opportunities that offer:
  • Immediate cash flows
  • Low risk

asset quality and location

  • Low risk – asset quality and location
  • We are delivering - recently announced Silverstone acquisition is

accretive on all major metrics and anticipated to close in the second quarter

29

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SLIDE 31

Silverstone Resources – Announced Acquisition

  • Friendly acquisition of Silverstone through Plan of Arrangement

announced in March 2009 announced in March 2009

  • 0.185 Silver Wheaton shares per Silverstone share
  • Approximately 24 million Silver Wheaton shares to be issued to
  • Approximately 24 million Silver Wheaton shares to be issued to

Silverstone shareholders representing a 7% pro forma interest (fully diluted)

  • Lock-ups from Capstone Mining and Silverstone insiders totaling 24%
  • Unanimous support and recommendation of Silverstone Board of

Directors Directors

  • Expected to close in May 2009

30

slide-32
SLIDE 32

Transaction Rationale for Silver Wheaton

  • Transaction is accretive on all key metrics
  • Consolidates the silver streaming industry, solidifying Silver Wheaton’s

status as the largest silver streaming company in the world

  • Aligned with business strategy

immediate production and cash flow Aligned with business strategy immediate production and cash flow

  • Positions SLW for additional significant accretive acquisitions
  • Three new silver stream agreements from low cost copper mines

Three new silver stream agreements from low cost copper mines

  • Minto + Cozamin + Neves Corvo = 4.5 million oz of silver equivalent in 2009*
  • Low political risk and significant exploration upside

Low political risk and significant exploration upside

  • Diversifies Silver Wheaton production to 11 operating mines / 8
  • perating partners

31

* Assumes a Au/Ag ratio of 70:1

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SLIDE 33

Value for Silverstone Shareholders

  • Substantial premium to recent SST trading price
  • 18% spot premium and 40% premium based on 20-day volume weighted average prices*
  • Significant ownership stake in the silver stream leader
  • Highly liquid shares with average daily trading of approximately $81 million**
  • Strong growth profile and increased diversification
  • Geography
  • Geography
  • Counterparty
  • Primary Metal
  • SLW share price upside
  • Proven ability to fund strong pipeline of significant opportunities

32

* As of March 12, 2009 **2009 YTD trading on TSX and NYSE

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SLIDE 34

Mine Locations - Pro Forma

Zinkgruvan Mineral Park Keno Hill Minto Stratoni Peñasquito Luismin Campo Morado La Negra Neves-Corvo Aljustrel Yauliyacu Cozamin

Development Projects Operating Mines Silverstone – Core Operating Mines

Navidad 33

Silverstone – Other Assets (Growth Upside)

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SLIDE 35

Strong Production Profile

  • Increase from 100% to 140% growth in silver equivalent sales by 2010*
  • Significant additional upside from the Neves-Corvo Zinc Aljustrel and Navidad

30 35

Significant additional upside from the Neves Corvo Zinc, Aljustrel and Navidad projects

20 25 30

Ag eq.)*

+100% +140%

10 15

ales (M oz

5 2008 2009E 2010E 2011E 2012E 2013E

Sa

Silver Wheaton Silverstone (Core Assets)

34

* Assumes a Au:Ag ratio of 70:1

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SLIDE 36

Increase in Reserves and Resources

  • Pro forma reserves greater than 500 million oz silver equivalent and total

resources of ~ 1.3 billion oz silver equivalent

1400 1600 g Eq.)*

P&P Reserves

Pro Forma

800 1000 1200 lver (M oz Ag + 27%

P&P Reserves M&I Resources Inferred Resources

Pro SLW

400 600 800 Contained Sil + 38%

SLW Pro Forma

200 C

Total Reserves d R

+ 38%

P&P Reserves

35

* Assumes a Au:Ag ratio of 70:1, Silverstone resources include Minto, Cozamin, Neves-Corvo and Aljustrel

and Resources P&P Reserves

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SLIDE 37

Minto Mine – Yukon, Canada

  • High grade and low cost copper-gold-

silver mine silver mine

  • Forecast cash costs net of by-product credits
  • f $1.00/lb copper

D bl d d ti l l i

  • Doubled production levels since

commencing production in 2007

  • Pre-feasibility study in 2009 targeting

% additional 50% mill expansion

  • Significant exploration upside
  • Growth in resources of greater than 140%

Growth in resources of greater than 140% from 2005 – 2007 (not inclusive of 2008 drilling)

  • Forecast to produce 290,000 ounces of

36

p , silver and 31,000 ounces of gold in 2009

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SLIDE 38

Cozamin Mine - Zacatecas State, Mexico

  • High grade and low cost copper-silver-lead-zinc mine
  • Forecast cash costs net of by-product credits of $1.00/lb copper
  • Two successful expansions tripling production levels in less than three

years years

  • Significant exploration upside with demonstrated resource additions
  • Forecast to produce approximately 1 5 million ounces of silver in 2009
  • Forecast to produce approximately 1.5 million ounces of silver in 2009

37

slide-39
SLIDE 39

Neves-Corvo Mine - Lisbon, Portugal

  • Low cost and high grade

copper-zinc- silver mine copper zinc silver mine

  • Proven operator
  • Significant producer of copper since

Significant producer of copper since 1989

  • Mill capacity of 2.2 million

tonnes per year tonnes per year

  • Zinc circuit recently converted to

handle copper ore

  • Record production was achieved in ore mined and processed in 2008
  • Demonstrated exploration upside

38

  • Forecast to produce approximately 500,000 ounces of silver in 2009
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SLIDE 40

Silverstone – Other Upside Opportunities

Neves-Corvo Zinc

  • Owned by Lundin Mining and covered by existing silver stream agreement
  • World-class Lombador zinc-lead-silver deposit adjacent to copper deposits
  • Zinc expansion project will re-commence once zinc prices improve

Aljustrel

  • Silver stream agreement with zinc-lead-silver Aljustrel mine in Portugal
  • Under care and maintenance until base metal prices improve

Navidad Project

  • Convertible debenture with right to convert into 12.5% LOM payable silver

f f

39

from a portion of the Navidad silver project in Argentina

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SLIDE 41

Diversified Commodity Exposure

  • Increases exposure to low-cost copper

SLW 2009 Commodity Exposure* Pro Forma Annualized 2009 Commodity Exposure*

Gold Zi Gold 36% Copper Zinc 38% Gold 46% Zinc 49% Copper 26% Copper 5%

40

* Figures are based on forecast silver sales

slide-42
SLIDE 42

Strong Pro Forma Share Price Upside

  • Improved Cash Flow and Production Leverage for all Silver Wheaton holders

14 0 16x

Price / Cash Flow* Production Ag Eq.** / Share

+9% 0 074 0.081 0 08 0.09 14.0x 9.3x 11.8x 8.6x 10x 12x 14x

Multiple

+19% 0.052 0.074 0.062 0.05 0.06 0.07 0.08

. Ounces

4x 6x 8x

Price/CF M

0.02 0.03 0.04

Silver Eq.

0x 2x 2009E 2010E Silver Wheaton Pro Forma

  • 0.01

2009E 2010E Silver Wheaton Pro Forma(annualized) Silver Wheaton Pro Forma

41

* Based on consensus analyst forecasts. No synergies assumed. ** Assumes a Au:Ag ratio of 70:1.

Silver Wheaton Pro Forma( )

slide-43
SLIDE 43

Debt Sensitivity Benefits*

  • Further strengthening of Silver Wheaton balance sheet and cash generation

Debt Repayment By:

$15/oz $10/oz $10/oz $8/oz Dec-08 Dec-09 Dec-10 Dec-11

42

* Assumes a Au:Ag ratio of 70:1

= SLW = Pro Forma

slide-44
SLIDE 44

Silverstone Acquisition Summary

Accretive Transaction - Immediate Production and Cash Flow

 

Consolidates the Silver Streaming Industry

Diversifies by Counterparty, Geography and Primary Commodity

Quality Operators and Low Cost Copper Mines

Low Risk Jurisdictions

Strong Exploration and Growth Potential

Pro Forma Share Price Upside

Further Strengthens Balance Sheet

Positions Silver Wheaton for Additional Accretive Transactions

43

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SLIDE 45

Summary

  • Largest silver streaming company in the world

Sil t i iti lidifi thi iti

  • Silverstone acquisition solidifies this position
  • Robust organic growth profile
  • Greater than 100% organic sales volume growth by 2010 (not including Silverstone acquisition)

Greater than 100% organic sales volume growth by 2010 (not including Silverstone acquisition)

  • Established, long life, low-cost mines with considerable upside potential
  • Reserve/resource additions, production expansions
  • Strong cash flow & earnings
  • Significant leverage to increases in silver price
  • Downside protection
  • Very low political risk profile

44

  • Well positioned for further growth
slide-46
SLIDE 46

Appendix

45

slide-47
SLIDE 47

SLW Equity Investments

Property of Interest Corani Rock Creek Hackett River Montanore Ownership 16% 12% 11% 11% Stage Pre-Feasibility Pre-Feasibility Pre-Feasibility Advanced E l ti g y y y Exploration Resource (Ag M oz) M&I 327

  • Inf. 35
  • Inf. 229
  • Ind. 200
  • Inf. 64

M&I 166

  • Inf. 65
  • Est. Annual Ag

Production +10 M oz/yr 6 M oz/yr 12 M oz/yr N/A

46

Source: Company Reports

slide-48
SLIDE 48

By-Product Silver Production

Silver Output By Source Metal*

29.7% 9.9% 2.0% 26.7%

Primary Silver Lead/Zinc Copper Gold

31.7%

Other

  • 70% of mined silver is produced as a by-product = significant growth

potential in the silver stream space

47

* GFMS & The Silver Institute

potential in the silver stream space

slide-49
SLIDE 49

Silver Stream Agreements

Luismin Peñasquito Zinkgruvan Yauliyacu Stratoni Mineral Park Company Status Producing Producing (heap leach) Producing Producing Producing Producing Contract Length 25 yrs LOM LOM 20 yrs LOM LOM Ag Prod. 100% 25% 100% up to 4.75 M / 100% 100% g

  • z/yr

Mine Life 25+ yrs 19+ yrs 25+ yrs 25+ yrs 7+ yrs 21+ yrs C h C t $3 95/ * $3 90/ * $3 96/ * $3 90/ $3 90/ * $3 90/

*

Cash Costs $3.95/oz* $3.90/oz* $3.96/oz* $3.90/oz $3.90/oz* $3.90/oz Annual Ag Production 7-12 M oz 2-10 M oz 2 M oz Up to 4.75 M

  • z

1-2 M oz 0.4-0.6 M oz 48 Production

  • z

* SLW pays the lesser of $3.90/oz or spot price on these contracts

slide-50
SLIDE 50

Silver Stream Agreements

La Negra Campo Morado Keno Hill Company Status Producing Producing Development Contract Length LOM LOM LOM Silver Production 50% 75% 25% Mine Life 10 + yrs 6+ yrs 5+ yrs Cash Costs $3.90/oz* $3.90/oz* $3.90/oz* Annual Ag Annual Ag Production 0.5-0.7 M oz 0.8-1.0 M oz 0.8 M oz Date of expected prod ction 2010 49 production

* SLW pays the lesser of $3.90 and spot price on these contracts

slide-51
SLIDE 51

Reserves and Resources (as of December 31, 2008)

Proven & Probable Reserves Attributable to Silver Wheaton (1,4,5,6,10,12)

PROVEN PROBABLE PROVEN & PROBABLE Tonnag e Grade Contained Tonnag e Grade Contained Tonnage Grade Contained Silver Mt g Ag/t M oz Mt g Ag/t M oz Mt g Ag/t M oz San Dimas 1.69 381.3 20.7 3.40 362.2 39.6 5.09 368.5 60.3 Los Filos(11) 28.10 4.4 4.0 42.16 3.3 4.5 70.26 3.7 8.4 San Martin 0.32 32.7 0.3 0.71 47.8 1.1 1.03 43.2 1.4 Peñasquito (25%) Mill 140.30 33.9 152.9 111.93 25.2 90.5 252.23 30.0 243.4 Heap Leach 14.45 18.4 8.6 31.16 9.4 9.4 45.61 12.3 18.0 Yauliyacu(8) 0.77 138.7 3.5 1.28 174.4 7.2 2.06 161.0 10.7 Zinkgruvan Zinc Ore 8.76 112.0 31.6 2.00 56.0 3.6 10.76 101.6 35.2 Copper Ore 2.90 28.0 2.6 2.90 28.0 2.6 Stratoni 1.90 193.3 11.8 0.31 190.0 1.9 2.22 192.8 13.7 Mineral Park(9) 315.88 2.9 29.0 81.33 2.4 6.4 397.21 2.8 35.4 La Negra (50%) 0.14 76.9 0.3 0.10 69.5 0.2 0.24 73.9 0.6 Total 262.6 167.1 429.7

50

slide-52
SLIDE 52

Reserves and Resources (as of December 31, 2008)

Measured & Indicated Resources Attributable to Silver Wheaton (1,2,3,4,5,7,10,12)

MEASURED INDICATED MEASURED & INDICATED Tonnage Grade Contained Tonnage Grade Contained Tonnage Grade Contained Silver Mt g Ag/t M oz Mt g Ag/t M oz Mt g Ag/t M oz Los Filos(11) 0.20 5.1 0.03 7.38 4.8 1.1 7.58 4.8 1.2 Peñasquito (25%) q ( ) Mill 27.81 18.5 16.5 125.93 18.4 74.5 153.74 18.4 91.0 Heap Leach 1.44 4.1 0.2 7.60 5.0 1.2 9.04 4.9 1.4 Yauliyacu(8) 1.20 149.7 5.8 5.36 260.1 44.9 6.56 239.9 50.6 Zinkgruvan Zinc Ore 0.55 24.0 0.4 3.79 105.0 12.8 4.34 94.7 13.2 Copper Ore

  • 0.46

30.0 0.4 0.46 30.0 0.4 Mineral Park(9) 100.97 2.6 8.4 175.63 2.7 15.2 276.60 2.7 23.6 Campo Morado (75%) 0.37 257.9 3.1 4.97 173.4 27.7 5.33 179.2 30.7 La Negra (50%) 0.20 127.0 0.8 0.09 128.0 0.4 0.29 127.3 1.2 Total 35.2 178.3 213.5

51

slide-53
SLIDE 53

Reserves and Resources (as of December 31, 2008)

Inferred Resources Attributable to Silver Wheaton (1,2,3,4,5,7,10,12)

INFERRED Tonnage Grade Contained Silver Mt g Ag/t M oz San Dimas 15.14 316.4 154.0 Los Filos(11) 6.02 8.1 1.6 San Martin 3.01 119.0 11.5 Peñasquito (25%) Mill 176.40 17.0 96.2 Heap Leach 9.91 7.9 2.5 Yauliyacu(8) 11.41 207.9 76.3 y Zinkgruvan Zinc Ore 4.20 68.0 9.2 Copper Ore 0.55 42.0 0.7 Stratoni 0.64 203.4 4.2 Keno Hill (25%) 0.13 1015.8 4.4 ( ) Mineral Park(9) 320.15 2.3 23.8 Campo Morado (75%) 1.38 174.5 7.7 La Negra (50%) 0.11 75.3 0.3 Total 392.5

52

slide-54
SLIDE 54

Resources and Reserves - Disclosures

Notes: 1. All Mineral Reserves and Mineral Resources have been calculated in accordance with the standards of the Canadian Institute of Mining, Metallurgy and Petroleum National Instrument 43-101,

  • r the AusIMM JORC equivalent.

2. All Mineral Resources are exclusive of Mineral Reserves. 3. Mineral Resources which are not Mineral Reserves, do not have demonstrated economic viability. 4. Reserves and Resources are reported as of December 31, 2008, with the following conditions or exceptions: a. Reserves and Resources for Stratoni are reported as of December 31, 2007. b. Reserves and Resources for San Martin are reported as of December 31, 2006. Reserves and Resources are expected to be updated in Q2 2009. c. Reserves and Resources for Mineral Park are reported as of December 29, 2006. d. Resources for Campo Morado are reported as of February 29, 2008. e. Resources for La Negra are reported as of February 15, 2008 for the Alacran deposit and March 14, 2008 for the Monica deposit. f. Resources for Keno Hill are reported as of June 30, 2008. 5. Qualified Persons for the Mineral Reserve and Mineral Resource estimates as defined by the National Instrument 43-101 are as follows: a. San Dimas, Los Filos – Reynaldo Rivera, MAusIMM (Chief Geologist), Goldcorp Mexico, the Mexican operating subsidiary of Goldcorp Inc. b. San Martin – Velasquez Spring, P.Eng. (Senior Geologist) Watts, Griffis and McOuat Limited. c. Zinkgruvan – Per Hedstrom, AusIMM (Senior Geologist) and Lars Malmstrom, AusIMM, (Chief Geologist), both employees of Zinkgruvan Mining AB d. Yauliyacu – Neil Burns, M.Sc., P.Geo., (Director, Geology), Samuel Mah, M.A.Sc., P.Eng., (Director, Engineering), both employees of Silver Wheaton Corp. e. Peñasquito - Bob Bryson, MMSA, (Vice President, Engineering), Goldcorp Inc. f. Stratoni - Patrick Forward, AusIMM (General Manager, Exploration), European Goldfields Ltd. g. Campo Morado – Stephen J. Godden, F.I.M.M.M., C.Eng. (Director) S. Godden & Associates Limited; P. Taggart, P.Eng. (Principal) P.Taggart & Associates Ltd.; David Gaunt, P.Geo. and Qingping Deng, Ph.D., C.P.Geol. (Vice President of US Operations and Global Director of Ore Reserves and Mining Planning) Behre Dolbear & Company (USA), Inc. h. Keno Hill - G. David Keller, P.Geo. (Principal Resource Geologist) SRK Consulting (Canada) Inc.; Gordon Doerksen, P.Eng. (Principal Consultant - Mining) SRK Consulting (Canada) Inc.; Josef Sedlacek, P.Eng. (Principal Consultant) SRK Consulting (Canada) Inc., Hassan Ghaffari, P.Eng. (Manager of Metallurgy) Wardrop Engineering Inc. and Diane Lister, P.Eng., (Consulting Environmental Engineer and Principal) Altura Envinronmental Consulting. i. La Negra – Thomas C.Stubens, M.A.Sc., P.Eng. (Senior Geologist) Wardrop Engineering Inc., Barnard Foo, M.Eng., P.Eng. (Senior Mine Engineer) Wardrop Engineering Inc. and Ronald G. Simpson, P.Geo. (President), GeoSIM. j. Mineral Park – Gary Simmerman, FAusIMM (Vice President, Engineering and Mine Manager), Mercator Minerals Inc. k. Overall Corporate Review – Neil Burns, M.Sc., P.Geo., for Resources (Director of Geology), Samuel Mah, M.A.Sc., P.Eng. for Reserves (Director of Engineering), both employees of Silver Wheaton Corp.

53

slide-55
SLIDE 55

Resources and Reserves - Disclosures

6. Mineral Reserves are estimated using appropriate recovery rates and US$ commodity prices of $12 per ounce of silver unless otherwise noted below: a. San Martin Reserves – US$7.00 per ounce b. Yauliyacu Reserves – US$10.00 per ounce c. Mineral Park Reserves - 0.237% Cu equivalent cut-off grade (hypogene), 0.283% Cu equivalent cut-off grade (supergene). Copper equivalent considers only copper and molybdenum c. Mineral Park Reserves 0.237% Cu equivalent cut off grade (hypogene), 0.283% Cu equivalent cut off grade (supergene). Copper equivalent considers only copper and molybdenum values (silver was not included). 7. Mineral Resources are estimated using appropriate recovery rates and US$ commodity prices of $14 per ounce of silver, unless otherwise noted below: a. San Martin Resources – US$8.00 per ounce b. The San Pedrito project Resources at San Martin– US$5.50 per ounce c. Zinkgruvan Resources – US$10.00 per ounce d. Stratoni Resources – US$12.00 per ounce e. Campo Morado (G9) Resources - 5.0% zinc only cut-off grade, silver was not included f. Keno Hill Resources – US$8.00 per ounce e o esou ces US$8 00 pe ou ce g. La Negra (Alacran) Resources - US$12.00 per ounce h. La Negra (Monica) Resources - US$13.50 per ounce i. Mineral Park Resources - 0.225% Cu Equivalent cut-off grade. Copper equivalent considers only copper and molybdenum values (silver was not included). 8. Silver Wheaton’s purchase agreement with Glencore provides for the delivery of up to 4.75 million ounces of silver per year for 20 years so long as production allows. In the event that silver produced at Yauliyacu in any year totals less than 4.75 million ounces, the amount sold to Silver Wheaton in subsequent years will be increased to make up the shortfall. 9. The Mineral Park reserves and resources do not include the SX/EW leach material since this process does not recover silver. 10. The Company considers the San Dimas, Yauliyacu and Peñasquito operations to be Material Assets, and has technical reports filed and available on www.sedar.com on each of these assets. 11. Los Filos reserves and resources are reported without the Bermejal deposit, as Bermejal is not subject to the silver sales agreement. p j p , j j g 12. Silver is produced as a by-product metal at all operations; therefore, the economic cut-off applied to the reporting of silver reserves and resources will be influenced by changes in the commodity prices of other metals at the time.

54

slide-56
SLIDE 56

Keno Hill Alexco Resource Corp.

  • Keno Hill is one of the highest-grade historic

silver producing districts in the world silver producing districts in the world

  • 217 million ounces of silver produced over 75 years
  • Average grade in excess of 40 ounces per ton silver
  • Silver grade in top 3% of global silver producers
  • Resumption of high grade silver-lead-zinc

production scheduled for 2010 from Bellekeno production scheduled for 2010 from Bellekeno project

  • Anticipated low cost producer
  • Anticipated low cost producer
  • Immense exploration potential and future

production upside planned

55

production upside planned

  • Several near term production targets being advanced
slide-57
SLIDE 57

Keno Hill – Transaction Terms

  • 25% life of mine silver production over entire 240km2 Keno Hill property
  • Upfront cash payment of US$50 million in two tranches:
  • US$15 million already paid to fund ongoing underground development
  • US$35 million payment once permits received and construction underway
  • Purchase price is the lower of US$3.90/oz or spot silver price
  • Silver Wheaton has no ongoing capital expenditures or exploration costs
  • Completion guarantee

Completion guarantee

  • Silver Wheaton forecast to receive +800,000 ounces of silver annually

with very significant upside potential with very significant upside potential

56

slide-58
SLIDE 58

Keno Hill – Historic Silver Production

57

slide-59
SLIDE 59

Keno Hill – High Grade/Vast Potential

50 0

Global Silver Deposits - Grade Comparison

40.0 45.0 50.0

  • n)

Martha

25.0 30.0 35.0

(ounces per t Keno Hill Historic Resource

Juanicipio Platosa‐Saltillera Ying

Bellekeno

Goltsovoye

10.0 15.0 20.0

Silver Grade

Silvertip Greens Creek Cannington San Jose Topia Lucky Friday Uchucchacua Prognoz Dukat Fresnillo Pallancata La Colorada Guanacevi Yauliyacu

  • 5.0
  • 5.0

10.0 15.0 20.0 25.0

Ares Caylloma Hacket River Morococha San Cristobal Palmarejo Rock Creek Pitarilla Fuwan Piriquitas Corani San Bartolome Yauliyacu

Base Metal + Gold in Silver Equivalent Ounces per Ton*

* Calculated using $12/oz Ag, $650/oz Au, $0.75/lb Zn, $0.45/lb Pb, $2.50/lb Cu (100% metallurgical recoveries) Source – Company reports

slide-60
SLIDE 60

Mineral Park - Mercator Minerals

  • Cu-Mo-Ag open pit mine in northwest

Arizona in continuous operations for Arizona in continuous operations for more than 30 yrs

  • Commissioning of 25,000 tpd mill

g , p underway with first silver bearing copper concentrate produced in December 2008 December 2008

  • Current Silver Reserves & Resources:
  • P&P Reserves:

35 M oz

  • M&I Resources:

24 M oz

  • Inferred Resources:

24 M oz

  • Anticipated mine life of at least 21

c pa ed e e o a eas years

59

slide-61
SLIDE 61

Mineral Park - Transaction Terms

  • 100% of LOM silver production
  • Silver Wheaton forecast to receive up to 600,000 ounces of silver

annually for at least 21 years $

  • Upfront cash payment of US$42 M
  • Purchase price is the lower of US$3.90/oz or spot silver price
  • Completion guarantee

60

slide-62
SLIDE 62

Campo Morado - Farallon Resources

  • Farallon’s volcanogenic massive sulfide district in Mexico
  • Commercial production underway at high grade G 9 deposit
  • Commercial production underway at high grade G-9 deposit
  • 1,500 tpd mine
  • Ultra low cash cost zinc mine

F h hi h d d i i hi 116 k

2

i

  • Four other high grade deposits within 116 km2 concession area
  • Excellent potential for exploration growth
  • Silver Resources:

Silver Resources:

  • M&I Resources: 31 M oz
  • Inferred Resources: 8 M oz

61

slide-63
SLIDE 63

Campo Morado - Transaction Terms

  • 75% of LOM silver production in the

entire 116km2 property entire 116km2 property

  • Silver Wheaton forecast to receive

800,000 to 1,000,000 ounces of , , , silver annually

  • Upfront cash payment of US$80

million

  • Purchase price is the lower of

US$3 90/oz or spot silver price US$3.90/oz or spot silver price

  • Completion guarantee

62

slide-64
SLIDE 64

WHY SILVER?

63

slide-65
SLIDE 65

Silver Demand

What is silver used for?

24% 9% 53% 24% Industrial De-hedging Photography Jewelry & Silverware 13% Jewelry & Silverware Coins and Investment

2008 Demand Forecast

1%

64

Source: GFMS

slide-66
SLIDE 66

Demand From Industrial Applications

Primary Uses:

  • Electrical & Electronics

Positive Trends:

  • Growth in Middle Class in
  • Electrical & Electronics
  • Chemicals
  • Brazing Alloys
  • Growth in Middle Class in

China & India

  • Growing use of Mobile

Phones

New Areas of Growth:

  • Silver-zinc batteries – “If successful,

Zpower could significantly increase Phones

  • Computerization in Third

World

  • More Stringent Environmental

Zpower could significantly increase demand for silver from around 2011 on.”

(Brook Hunt - ‘Silver, The Outlook to 2020’)

  • Solar

More Stringent Environmental Laws

  • LCD/Plasma Screens
  • Medical Instruments
  • Biocides

65

Source: CPM Group, RBC Capital Markets

slide-67
SLIDE 67

Industrial Demand

500 300 400

n ounces)

100 200

Silver (million Electrical and Electronic Other

I i d d f th l t 7 d it i i i (7% i 2007)

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008F

  • Increase in demand every year for the last 7 years despite rising price (7% in 2007)
  • Demand is relatively inelastic to the price of silver (low proportion of input cost)
  • New record levels expected in 2008 but decline forecast in 2009

66

New record levels expected in 2008 but decline forecast in 2009

Source: GFMS

slide-68
SLIDE 68

Investment Demand A Major Catalyst of Silver Price

  • Demand for silver ETF’s

t d t i

300 $25

SD)

Silver Price and iShares Silver Trust Holdings

expected to increase

  • iShares growing; applied

for +360 M oz

150 200 250 300 $ $15 $20 $ 5

  • ns of oz
  • ndon Fix in US
  • New ETF’s emerging
  • Increased investment

demand expected to offset

50 100 $0 $5 $10 1/ 11 9/ 1/ 8/ 10 2/ 7/ 11 4/

Millio Silver Price (L

decreased industrial demand in 2009 C i d d h i i ifi tl fl ti i

/3/2006 1/5/2006 /19/2006 /30/2007 /6/2007 0/19/2007 /29/2008 /14/2008 1/18/2008 /1/2009

  • Coin demand has risen significantly reflecting a growing

investor interest

67

Source: GFMS & iShares

slide-69
SLIDE 69

Silver Supply

2008 Supply Forecast

20% 2% Mine Production 78% Scrap Government Sales

  • Mine production growth in 2009 still expected but much slower than

p g p previously forecast (due to impact of lower metals prices, project delays, etc)

  • GFMS revised 2009 mine production forecast is 700m oz in 2009, down from

68

Source: GFMS

the 730m oz previously forecast

slide-70
SLIDE 70

Changes in Government Stocks

40

  • 20

20

Ounces)

  • 60
  • 40

20

Silver (Million

  • 100
  • 80

S

Government inventories declining since 1999 to make up for supply deficits

69

Source: GFMS

slide-71
SLIDE 71

Silver Inventories are at a Historical Low

2,400 1,600 2,000

z)

1,200 1,600

ventory (M oz

400 800

Inv

50 55 60 65 70 75 80 85 90 95 00 05

70

Source: CPM Group, 2008

slide-72
SLIDE 72

From “Deficit” to a Balanced Market

950 850 900

es)

700 750 800

(million ounc Supply D d

600 650 700

Silver Demand

500 550 600

71

1992 1994 1996 1998 2000 2002 2004 2006 2008F Source: GFMS

slide-73
SLIDE 73

GFMS Silver Price Outlook - Conclusion

  • Silver’s supply/demand fundamentals (excluding investment) turning
  • Silver s supply/demand fundamentals (excluding investment) turning

negative in 2009 due mainly to lower fabrication demand, though supply side less threatening than formerly expected

  • Silver market will therefore move back into surplus but this metal will

be absorbed by investors

  • Silver prices will be volatile but tend to increase from current levels
  • Silver prices will be volatile but tend to increase from current levels
  • GFMS under its base case scenario currently forecast a calendar

2009 average silver price of around $13/oz g p $

72

Source: GFMS