Geoff Burns – President and CEO Steve Busby – COO Michael Steinmann – EVP, Geology and Exploration Rob Doyle – CFO

Ankush Agarwal – JP Morgan Edmund Tan [ph] – Southside Investors [ph] Daniel Earle – TD Newcrest Steven Butler – Canaccord Adams Haytham Hodaly – Salman Partners Craig West – GMP Securities David Christie – Scotia Capital Kurt Miller [ph]

Good morning, ladies and gentlemen, thank you so much for standing by, and welcome to the Pan American Silver third quarter 2008 earnings conference call. During today's presentation, all parties will be in a listen-only mode. Following the presentation, the conference will be opened for questions. (Operator instructions) As a reminder, this conference is being recorded today on Thursday, November 13, 2008. I will now turn the conference over to Mr. Geoff Burns, President and CEO. Please go ahead sir.

Thank you, operator. Good morning, ladies and gentlemen, and welcome to Pan American Silver’s third quarter earnings release conference call. Joining me today here in Vancouver are Steve Busby, Chief Operating Officer; Michael Steinmann, Executive Vice President of Exploration and Mine Geology; Rob Doyle, our Chief Financial Officer; and Kettina Cordero, our Coordinator of Investor Relations. Before I ask Steve, Michael, and Rob to update you on our mining operations, our development projects, our exploration programs, and our financial condition, I would like to start by making some general comments about our performance during the third quarter and some observations about the current environment. What a difference a few months can make? When we last spoke in our second quarter earnings release call on August 13, the Dow Jones Index was 11,532, today it's 8283, down close to 30%. The NASDAQ composite was 2,428. Yesterday, it closed at 1499, down 38%. And the economies around the world have moved with alarming speed from growth to recession. The effects of the global financial crisis have and I dare say will continue to wash through the economies of the world. But its impacts have been particularly and, in business terms, instantaneously severe for the mining and commodity producers. Base metal prices have slumped, oil prices have plunged, and precious metals prices have not been immune to the contagion. Most importantly, to Pan American, the silver price was a very comfortable $14.68 per ounce on August 13, just three months ago, and this morning it opened at not nearly so comfortable $9.23 per ounce in New York. We are living through in a part of an amazing economic upheaval that has captured the global economy with the speed of the Internet, where the unthinkable has become the accepted, where the basic principles of supply and demand and ultimately price are being upended, and where common sense has been overwhelmed with fear and government intervention. I could continue to talk about the changes we are all reading about and seeing around us everyday and I can tell you it is extremely easy to lose focus and lament about what was just a few months ago. But that's not the purpose of this call and that is not what is Pan American's mantra. The purpose of this call is to keep you, our shareholders, informed about your company's plans not only to cope with this change and upheaval, but to continue to thrive and grow. How we are responding to this challenging and difficult environment, how quickly we are retooling and modifying our business plans, and how we will adapt will be the measure of Pan American's future success. Before I describe some of the steps we have already implemented and other measures we are still planning to take, we should review our most recently completed quarter. While there's no question that our financial results were negatively impacted by the sharp decline in base metal and silver prices that started in the middle of the third quarter and gathered speed towards the end of September, we still increased our silver production to 4.9 million ounces. We generated net earnings for a tenth consecutive quarter. We delivered a respectable $22.7 million in operating cash flow. We have maintained a healthy working capital position with no debt and are in the midst of starting our newest and lowest cost silver and gold mine, Manantial Espejo. And in addition, we discovered a fabulous new high-grade vein system at our Morococha mine in Peru. In short, we continued to do what we do best, build, commission, explore for, and operate mines profitably, and completed the third quarter extremely well positioned to continue to deliver growth and take advantage of the strategic opportunities that are becoming more prevalent. With that, I'm going to turn things over to Steve, Michael, and Rob who'll provide some additional detail and commentary on our operations, development projects, exploration programs, and financial condition. Steve?

Thank you, Geoff, and good morning ladies and gentlemen. As Geoff has mentioned, the recent and rapid deterioration of the metal markets combined with the preceding and unprecedented cost escalations has presented us with some significant challenges. We are assessing and adjusting our mine operations quickly in order to preserve our strong financial position and production profile. These assessments and adjustments are being carried out now and will be incorporated into our 2009 operating plans and budgets. We enjoyed another solid quarter where our operations produced 4.9 million ounces of silver, right on plan. Despite having significant disruptions at some mines, they were entirely offset by better than expected production from other mines. This performance highlights one of Pan American Silver Corp.’s strength, where our multi-mine portfolio allows typical pluses and minuses of individual mining operations to balance out. This strength will soon be enhanced even further as we bring on our Manantial Espejo mine in Argentina and our San Vicente mine expansion in Bolivia during the coming months. Our operating costs for the quarter were well above plan, at $6.61 per ounce, primarily due to slightly lower production of base metals and reduced pricing. In addition, our costs were negatively impacted by higher energy cost at our Huaron mine in Peru, which alone contributed nearly $0.33 an ounce of additional cost to our overall company-wide cash cost. We are also contending with lingering impacts from this year’s raw material and labor cost escalations. However, we believe these escalators will begin moving in our favor as the effects of the global economic crisis begin to sweep through the industry’s suppliers. Pan American’s quarterly performance was led by a record-breaking silver production of 1.7 million ounces from our Alamo Dorado mine in Mexico, which continues to enjoy an outstanding year exceeding all of our expectations. While we expect to see another strong quarter at Alamo Dorado to close out this year, it is important to comment that we will be forecasting somewhat reduced grades and silver production in 2009 as we sequence between our current Phase I high grade pit into the Phase II pit layback, yielding lower grades for the next year and a half. Our unit cash operating cost at Alamo Dorado finished the quarter about 7% higher than we had planned at $4.42 per ounce, primarily due to some serious raw material shortages particularly sulfuric acid leading to cost escalations. We expect this situation will turn in our favor very soon given the recent nearby mine curtailments. The La Colorado mine in Mexico also had another solid quarter producing over 980,000 ounces of silver. The unit cash operating cost increased to $8.70 per ounce impacted by the previous and sustained raw material escalations and the strong Mexican peso. We are taking measures to try and call back some of these cost escalations and have already seen favorable weakening of the peso. We’re expecting continued stable performance at La Colorado for the remainder of this year. Our Peruvian operations delivered 1.9 million ounces of silver production for the quarter, slightly behind target after being impacted by a seven-day labor disruption at Morococha and a five-and-a-half day production disruption at Huaron following an unexpected pinion shaft failure on our primary ball mill. Cash operating cost for the Peruvian operations was $7.37 per ounce, almost double our target due to the reduced base metal by-products production and value, as well as the very high energy cost increases we have been experiencing at Huaron. We’ve already seen significant relief in the power supply cost at Huaron, as the rains have began in Peru. Our Peruvian production was led by the Huaron mine which produced 894,000 ounces of silver, pretty close to plan. We are re-assessing the long-term deepening project at Huaron in light of the current metal prices to allow quicker production from higher grade zones while deferring some of the more expensive and extensive developments. Morococha mine produced 557,000 ounces of silver during the quarter, which was below plan following the June labor disruptions that spilled over into July. All of our employees and contractors continue to work normally since returning to work in mid-July. We are also re-assessing our long-tern developments at Morococha in light of the downturn base metal prices and we’ll be adjusting our mine plans there accordingly. Our Quiruvilca mine in Peru show [ph] their production to 355,000 ounces, as we continue to advance on certain key underground mine developments. We’re expecting about a 10% improvement to production from our Peruvian mines in the last quarter of 2008, at a higher cash operating cost due to the lower base metal prices offset to some degree by cost savings particularly in the Huaron energy and also in the favorable currency exchange movements. In Bolivia, our San Vicente expansion project continues to advance on schedule and on budget. While we continue to produce in total three doors [ph] at a nearby mill, the $12 million program produced 246,000 ounces of silver at a cost of $9.08 per ounce, above the $7.58 per ounce cost anticipated primarily due to the lower by-product prices. Our grades have improved dramatically during the quarter as we begin developing on the new and exciting littoral [ph] vein getting ready for the starting of our new mill in the early part of next year. We are expecting an equally strong quarter production to finish off the year. Total project capital expenditures to the end of the quarter were $54 million with the project nearing 80% completion. We expect to achieve mechanical completion of construction by year end and begin commissioning of this new plant in the first quarter of 2009. I am very pleased to report today that we are turning and grinding mills at our Manantial Espejo project in Argentina and are within days of feeding our first store to the circuit. We expect to begin producing silver and gold bars in December, some six months delayed from our original projection for the year, primarily due to the previously reported electrical gear theft, as well as some extreme category five class hurricane wind disruptions that have negatively affected contractor productivities. Largely as a result of these delays, combined with a continued cost escalation, we now estimate our capital cost to complete the project at $225.4 million, which includes $27.5 million of recoverable VAT tax payments and more than $10 million of additional mine development expenditures as we have continued to mine and advance with the plant start-up. Additional mining will reduce future operating cost, in addition to allowing us access to higher grade ores earlier than had originally been planned. We now have a very comfortable 300,000 ton ore stockpile ahead of the mill in addition to significantly more ore tons immediately accessible in the open pits and underground phases, all awaiting the plant start up. We remain confident Manantial Espejo will significantly enhance Pan American Silver’s production profile, with its anticipated $4.1 million ounce average annual low cost silver production and 60,000 ounces gold production, once steady state production stabilizes in mid-2009. In addition to several cost saving initiatives which will be described later, we are carefully assessing all of our mine plans and adjusting them to adapt to the current metal market prices. We have also cancelled all discretionary capital projects. However, we are not making any decisions which will impact our expected production profile. The results of these initiatives will be quantified once our 2009 operating budget is finalized. In conclusion, we expect to deliver another equally solid quarter to end this year, forecasting a production of 4.8 million ounces of silver at a cash cost of around $7 per ounce. Therefore, our full year 2008 forecast remains at 18.8 million ounces of silver at a cash cost of $5.70 per ounce, with a long-term outlook of higher production at lower cost as our Manantial Espejo low cost production comes into the mix and we begin to reap the benefits of our cost saving initiatives. This concludes my overview of our mine operation and projects advances. I will now turn the call over to Michael Steinmann for the exploration update.

Thank you, Steve, and good morning. As Geoff and Steve explained, these are challenging times and as a consequence, we have made some changes to our exploration plans, especially in the Greenfield program. I will describe some of these changes in a moment, but would like to share first some of the exploration highlights we had in the last quarter and in the first nine months of 2008. Between our Brownfield and Greenfield exploration programs, we have completed a total of 76,600 meters of diamond drilling during the first nine months of the year. It is all part of our plus 100,000 meter drill program for 2008. The underground exploration at Huaron keeps returning excellent results, especially in (inaudible) veins, where we discovered high grade intersects over some exceptional width of up to 9 meters in some cases. As usual, in many veins of Huaron, the samples carry not only high silver, but also substantial lab [ph] and zinc grades. There is no doubt that the low-metal prices will have an impact on the upcoming year-end resource statements especially in the higher zinc grade areas of the mine. But I am confident that we still be able to replace what we have mined in 2008 at Huaron, with new reserve additions, if metal prices stay close to current levels. On October 15, we published the results of 26 surface and 4 underground drill holes from the Morro Solar discovery at Morococha. This major vein is located only 1.7 kilometers to the Northwest of the main shaft and is accessible in the uppermost levels by a ramp. Lower elevations will be accessed by the Sierra Nevada ramp, which will pass in the future only 100 meters away from the vein. One of the best drill holes intersected the vein over 5.1 meters at 949 grams silver per ton and 9.7% zinc. At the time of the press release, we have drilled only 150 meters down deep and 800 meters strike length of this 2.5 kilometer long vein. Two of the most recent drill intersects encountered the vein to the west of the existing drill holes; a 3.5 meter width at 121 gram per ton silver and 7.9% zinc, and below the 400 level a 3.4 meter width at 540 gram per ton silver and 4.4% zinc. This last drill hole confirms the down deep extension of now over 200 meters. Drilling also discovered fie sub-parallel veins and two splits. Five of these 7 additional structures returned silver grades of more than 1 kilogram per ton and in extreme cases over 5.6 kilogram and up to 14% zinc. The intersected width vary from 0.6 meters up to 4.6 meters. Although the ore shoots of this sub-parallel veins seem less continuous than Morro Solar itself, they’re definitely important exploration targets and highlight the immense potential of this prolific exploration area. I’m very confident that these high grade discoveries will add substantial resources to Morococha at the end of the year and will to help replace demand reserves in 2008. Our Brownfield or onsite exploration efforts remain largely in place in order to follow up the success we had at Huaron, La Colorada and Morococha. But I am sure you noticed in our press release that we have made some changes to our Greenfield programs, reducing or deferring most of our early-stage projects. We will maintain our important land position in Peru and Mexico and keep the most promising option contracts. Exploration space has gone through a fundamental change in the last four to five months due to the market turmoil and difficulties in raising capital to explore many advance stage discoveries held by others have stalled. Fortunately, we have available liquidity and decided to defer our own Greenfield efforts, and have a close look at advanced projects held by others. We will try to negotiate mutually beneficial arrangements with the current owners in order to advance the most promising of these discoveries. Here’s Rob, now for you financial review.

Thanks, Michael, and good morning everyone. Our financial results in Q3 2008 were impacted by sharp decline [ph] in metal prices and zinc and lead prices declined by 45% and 39% respectively relative to the comparable period of 2007. Silver prices have also declined significantly as compared to the prices we enjoyed in the first half of 2008. The price declines have two obvious impacts on our financial results. Firstly, and in spite of an increase in our silver production, our sales have declined by 10% relative to Q3 2007 and by 24% relative to Q2 2008. Included in Q3 sales was a negative $2 million final price adjustment to concentrates that had been provisionally priced in Q2 and finally sold at lower prices in Q3. The second obvious impact of lower prices is seen in our cash costs, as we utilize revenues from our base metal production as by-product credits against the cost of producing silver. These credits declined by $4.87 per payable ounce in Q3 relative to the comparable period of 2007, and as a consequence, our cash cost declined to $6.61 per ounce in the third quarter. However, in spite of the adverse effects of declining metal prices, we still generated positive results in the third quarter. Our mine operating earnings were $15.5 million, net income of $6.4 million or $0.08 per share. Adjusted net income for the quarter was $11.3 million or $0.14 per share. Cash flow from operations was $22.7 million. Our statement of operations for Q3 included a gain on commodity and foreign exchange contracts of $3.7 million, of which $3.3 million was realized. Making up this number was the gain of $5.4 million on our base metals and silver fixing books, offset by a loss on our FX hedge book of $1.7 million. The loss on our FX book was the result of the strengthening US dollar against the Peruvian sol and the Mexican peso. In addition to the loss in our FX book, we also incurred an unrealized foreign exchange loss of $2.9 million in Q3, which rose as the result of re-valuing our cash and other working capital balances held in currencies other than US dollars at quarter end. Our income tax expense for the quarter was $6 million, which was an effective tax rate of 48%. Our effective rate was well above our expectations, given the tax rates prevailing in the jurisdictions in which we regenerate taxable income. However, we had to reverse $1.4 million of tax loss carry-forwards in Argentina from our future income tax estimates, as this amount had been incorrectly benefited in previous periods. Moving to the balance sheet, our working capital decreased by $47.1 million during the quarter, as we invested heavily in our two development projects, Manantial Espejo and San Vicente. We spent $33.6 million at Manantial Espejo, that's increase of $4.1 million of refundable debt, and $14.2 million at San Vicente during the quarter. In addition, we invested $12.3 million on capital projects at our existing operations. New capital expenditures were partially funded from cash flow from operations of $22.7 million and the balance from our working capital. We finished the quarter with a solid working capital position of $167.4 million at the current ratio of 3.3 to 1 and cash and short-term investments of $90.9 million. We have no debt and are fully funded to complete our construction projects where expenditures are declining rapidly. Most importantly, our forecast show that we continue to generate positive cash flow from operations at current prices and are well-positioned financially to weather these turbulent times. In addition to our own liquidity and capital resources, we closed 70 million four year revolving credit facility in early October which Scotiabank as admin agent, and Standard Bank as joint lead arranger. The purpose of this facility is for general corporate purposes including acquisitions. The facility has an interest margin ranging from 1.25% to 2% of the LIBOR from [ph] the company’s net debt to EBITDA ratio. This facility has been structured as an accordion facility and we could increase the facility up to $100 million by receiving additional commitments from other banks if we decide to do so. As of today, we have not drawn on the facility nor do we have any current plans to do so. I would like to take the opportunity to commend Scotia and Standard for delivering on their commitments to us in the face of unprecedented turmoil in the credit markets. With those comments, Geoff, I will hand it back to you.

Thanks, Rob. Now let me highlight for you some of the comprehensive measures we have taken in response to the current metal price environment. We have reduced our workforce company-wide by over 500 employees and contractors. I have asked all our senior executives to take a 10% wage rollback. As Michael just described, we have deferred almost all of our Greenfield exploration programs and significantly reduced our Brownfield exploration. As Steve described, we are revising our mining plans to increase mine ore grades across all our operations. We canceled our discretionary capital expenditures, we are reducing or eliminating the use of external consultants and contractors, and where elimination is not an option, are requesting that charge-off rates be reduced. We are reviewing all our major suppliers and service contracts, again requesting price adjustments. In general, we are reviewing every dollar we spend to ensure we are getting immediate value in return. These measures and many additional measures that I have not described will reduce our cost and they will do so without, and I repeat, without compromising our production objectives. Simply put, the things that are in our control that we can change are being changed and restructured. I’d like to share with you today a segment from a letter I sent out on Monday to all the employees in Pan American, in Vancouver, in Peru, in Argentina and Bolivia. We have managed our company very conservatively, so we enter this difficult period in solid financial condition. We have enough resources to complete and start up our Manantial Espejo mine in Argentina and our San Vicente mine in Bolivia and we have no bank loans to pay back. With the start-up of these two operations and with the steps we’re taking today, I am confident that our company will not only survive this period, but will be again able to thrive and grow. My fellow employees, you have shown me in the past that we can do the difficult things and be a better and stronger company as a result. We will need to work together as a team now more than any time in the past four years, and with your full support and cooperations, we will reduce our cost. We will increase our productivity without compromising our commitment to safety. And as a team, we will reclaim our prosperity for the good of our employees, our families, our communities and our shareholders. Before opening the lines to take questions, I would like to make at least a few short comments on the silver market, the silver price and the equity markets in general. There is no question that the silver price has been under severe downward pressure. As I mentioned earlier in the call, silver opened at $9.23 per ounce today, and as a consequence, the silver equities, Pan American included, have also been hit hard over the last three months. However, even with the reality of a 38% decline in the silver price since our last conference call, there are many reasons to be extremely optimistic about the future prices. Ill advised government bailouts have driven worldwide government debt to epic proportions. Numbers have quickly gone from millions to billions, and now are in the trillions of dollars. Eventually, as the presses hum 24/7 to print money, I contend that the fundamental value of silver and gold will again be recognized and those same bailouts will undermine the very value of the paper currencies and economies those governments were trying to protect. Investors in the silver and gold ETFs seem to agree. Silver ETF has continued to grow and as of yesterday held more than 216 million ounces. Unlike the hedge funds that are on a daily basis liquidating their paper silver and driving prices down, the physical investment market remained very strong as common investors are accumulating physical silver and gold during these turbulent times. And personally, we believe they will be handsomely rewarded for their foresight. In closing, I would like to assure you that Pan American will continue to do what we do best. We will adapt our business to the current environment and we will thrive and grow. We have the team with the skills and the experience to do so. Thank you, and I would ask the operator to now open the lines for questions.

(Operator instructions) Our first question is from the line of Ankush Agarwal with JP Morgan. Please go ahead. Ankush Agarwal – JP Morgan: Good morning Geoff, everybody. I have two questions, first on Morococha, the grades have been declining there quarter over quarter now, is this simply because of the mine planning that was done during high metal prices earlier this year or are there any other reasons? And then the second question is a more broader question, in terms of – in the current extreme market environment and given your relatively stronger balance sheet position, how do you see your role of developing into a possible consolidator in the industry?

Okay, thanks Ankush. I think I’ll let Steve handle the first question and I’ll take on your second one when he’s done.

Yes, regarding the Morococha grades, we’ve had to readjust our mining operation this year away from what we had planned due to a variety of reasons. One, being ground conditions, we encountered some worse ground than we hadn't anticipated in some of the mining areas and also in some areas, we didn’t quite see the grade that we had expected. And as a result, we’ve adjusted and redirected our mine to other areas which did indeed bring us lower grade ores for the year. We do anticipate going back into these higher grade ores. And also with the new addition of Morro Solar, we’re expecting some higher grades from that area as well. So, our future does project a turnaround of those grades going forward.

Alright thanks Steve. In terms of being a consolidator, Ankush, clearly there are – a number of other companies have been hurt fairly badly on their share price as well as their business plans have come under great question with lack of liquidity, and we’re very aware of the companies in our sector who are in some difficult situation. And we’re going to continue to look at those very carefully. We are not going to act irrationally or too quickly. I think, it behooves [ph] us to again show some discipline, look for potentially the best pits with Pan American, the best opportunities to deliver value back to Pan American shareholders, and we will be talking to some of those players over the coming months. Ankush Agarwal – JP Morgan: Okay, thank you very much and good luck.

Thank you, Ankush.

Thank you. Our next question is from the line of Edmund Tan [ph] with Southside Investors [ph]. Please go ahead with your questions, sir. Edmund Tan – Southside Investors: I have a number of questions, but first question is apparently is so important that I’d like to devote that – address that first. In the financial times, Monday, October 20th, there was a full-page article proclaiming a viewing revolution 3D cinema poised to hit the big screens. A number of big players are investing money in what they call the silver screen, where they are going to open up anywhere from 30,000 to 50,000 screens, they have a number of 3D films already on line awaiting the screens, and these screens are impregnated with silver in order to achieve the 3D process. Katzenberg says that 3D cinema is going to be the revolution in film of the future. I’d like the company to address the possibility of the plethora of silver screens that are about to go online for construction to affect silver in general, and then I’ll go into my other two questions.

Edmund, it’s Geoff Burns. You have some information that I’d be frank, that I’m not aware of. I didn’t – had not seen that article and in the new developments for silver technology, 3D viewing screens have not been something that had been brought forward by the Silver Institute as a future use of silver. Having said that, your description sounds – the potential sounds incredibly appealing and I certainly hope that prognostication that you brought forth comes to pass. Edmund Tan – Southside Investors: I will refer you again to the Financial Times article Monday, October 20, full-page article on page number 18. So, I'd appreciate it very much if, when I speak to you in the future, you would have armed yourself with the possible impact on our company of this new development, so that I'll appreciate your attending that. The second question I have is the possibility of the wave of nationalizations throughout South America as witnessed Bolivia, Venezuela. How will that possibly affect the ability of these countries to operate under force majeure in order to impact the viability of a company such as Pan American?

First of all, Edmund, I'm not aware of a wave of nationalization. The most current news that I can recall is a description coming out of Venezuela of an attempt to take over the Las Cristinas development project. As far as Peru and Bolivia gold, there have been to date no nationalizations of any mining activities, so I'm today very comfortable that we're not exposed in any dramatic fashion to a sweeping wave of government intervention or government takeover. I think it is fair to say that the governments particularly in some of the poorer of the developing countries like Bolivia, certainly they are hungry for cash to continue to run their programs. But in general, they haven't demonstrated to this point a great desire to take over businesses that they have proven in the past, but they're ill equipped to run. So I have continued to hope that we do not see a sweeping spat of nationalization. Edmund Tan – Southside Investors: Vis-à-vis that, if we look at the Venezuelan model, the Venezuelans are calling in a Russian company to operate with cash and with personnel. In other words, we may be witnessing a world play where Russia is coming in on the originally what was ostensibly an American gemini [ph] in South America, we see now that as a tit for tat with Georgia and Ukraine and what we're doing over there that Russia is coming in on our doorstep and also into one company with their own personnel, with their own money. Can you comment on that?

Edmund, I'm going to try and keep my comments to things that directly affect Pan American and our future. Events in Georgia and Venezuela have very little impact on our business plan at this point. Edmund Tan – Southside Investors: Okay. The third question is, reference was made to the fact that paper – that ETFs and silver are doing all right. Since Pan American is a paper holding of many of us, that immediately strikes a discordancy, heck, we don't have the – or we are not into the bullion silver into Pan American paper. Can you reflect on the connection between the buoyancy of the silver market, the ETF, vis-à-vis the stock price of Pan American silver?

Certainly, the price of silver is directly reflected in the price of our shares and as silver has declined, so has the value and the trading price of Pan American stock. The disconnect that I was referring to is that physical demand for silver remains incredibly buoyant. As I mentioned, the ETF has continued to grow, which is a physical purchaser of silver. If you were today to try and order silver coins from the US Mint, you would not be able to get them because the US Mint hasn't been printing them for a while because they ran out of silver. If you ordered coins from other small minters around the country, you would be put on a wait list that approaches three to six months. So it is surprising to me that there is a clear disconnect between the demand and the price as it trades and has been trading in New York. And it clearly, in my view, points to the trade of paper silver between – in the futures markets between players who have no interest or no desire to (inaudible). And until that paper trade dwindles and I believe it will, as hedge funds finally remove themselves from the commodity, I think there is real reason to be optimistic about the future silver prices. Edmund Tan – Southside Investors: Okay. What is your time frame for such an occurrence? Hypothetically.

That is probably the most difficult to comment on, Edmund. It also relates to the – what I believe is a false strengthening in the US dollar. The two are very highly related. The slight to cash has driven the US dollar to (inaudible) we haven't seen for quite a number of years. It will unwind, in my opinion, as will the paper trade decline around the silver price. Edmund Tan – Southside Investors: I see. You will have it by surprise. I'm sorry.

Edmund? Edmund Tan – Southside Investors: Yes.

I think it's time for us to let some other questioners have their turn. Edmund Tan – Southside Investors: All right. May I call you at some future time?

Yes, you can. Please do so. Edmund Tan – Southside Investors: How do you spell your last name, please?

Burns. B-U-R-N-S. Edmund Tan – Southside Investors: Okay. Thank you.

Thank you, Edmund.

Thank you. Our next question is from the line of Daniel Earle with TD Newcrest. Please go ahead with your question, sir. Daniel Earle – TD Newcrest: Hi, Geoff, Rob. If you can just answer for me. Can you talk about the changes in FX rates and what sort of an impact you see from changing rates going forward?

There's two aspects to that question, Daniel. I am going to let Rob talk about our FX book and I'm going to talk about the direct impact. We've seen the Mexican peso essentially devalue relative to US dollar from about 10.50 to as low as 13.50 in recent times. I think it's in the 12.50 range today. Approximately 40% of our costs are paid in Mexican pesos for labor. So if you say we've had a 25% devaluation of the Mexican peso, you do some, I think some relatively simple math and you would expect our costs to decline by about 10%, multiplying 40% times 25%, and that should appear without us doing any change to our business plan. We're seeing similar changes in Peru although the devaluation of the sol relative to US dollar has been less marked. That is the impact I see on a go-forward basis on the cost side. We do have a hedge book, some degree for both sols and pesos. I'll let Rob comment on that.

Sure. We've been essentially buying both those currencies ahead of time in that we didn't actually continue them as Geoff described and so as of the end of September, we had about just a little over $70 million worth of Peruvian sol bought forward at rates somewhere in the lower 2.8 range and about close to $20 million worth of pesos bought forward at about the 10.60 range. So obviously from a mark-to-market perspective with the dramatic devaluation of those currencies at the end of the third quarter that gave rise to the mark-to-market losses that we've recorded in our books. In addition to that, we also do have some cash balances in currencies other than US dollars and so accounting convention dictates that we need to fair value those holdings at each balance sheet dates. We are holding a fair amount of our excess cash in Canadian dollars and as the Canadian dollar has weakened against the US dollar, that gave rise to an additional loss which we recorded in the third quarter. Daniel Earle – TD Newcrest: Okay. Great. Can you talk about the same on the metals side, the hedge book?

Sure. As of the end of September, we had – our zinc book was down to about 7,500 tons of zinc sulfide at prices around $2,500 that represents about 20% of our production through the balance of 2009. And similarly with lead, we've sold forward roughly about 20% of our production at prices between $1,900 and $2,100. So obviously as the price of zinc and lead decline, then the mark-to-market on those books improves. Daniel Earle – TD Newcrest: Okay, great. And then final question here, on the discretionary capital spending that you can't hold, how much do you expect to save?

We're in the process, as Steve mentioned, of putting together our full 2009 and long-range plans and I'm hesitant to quantify the absolute magnitude of not only our employment changes, but our aspiration changes and capital changes until we've gone through that process, and we're literally about 10 days away from finalizing those budgets. It will be significant. We have been spending at – we're on our capital budgets for around $11 million for 2008 at Morococha closer to $14 million, at La Colorada about $10 million. So, going forward, my expectation would be that we would see budgets of less than half of that amount in 2009. Daniel Earle – TD Newcrest: Great. Thanks so much.

All right. Thank you. Our next question's from the line of Steven Butler with Canaccord Adams. Please go ahead. Steven Butler – Canaccord Adams: Geoff, you just indicated to Dan, I think, that you might not get too specific about putting the magnitude on that comp on the cost savings. Appreciate the efforts that you're making, but maybe I could ask a question about the labor in terms of what percentage is labor of the overall mine site costs for your several operations?

On average, I mean it varies a little bit between underground and open pit. Our underground operations are narrow vein and by default much more highly labor intense, but a 40% number is a good average on a company-wide basis to use on labor and we did just in essence cut our labor force by just above 10%. Steven Butler – Canaccord Adams: Over 10%, so 500.

That’s correct. Steven Butler – Canaccord Adams: Okay, plus the major savings at the head office, just kidding.

It’s huge! Steven Butler – Canaccord Adams: A little levity is always required in these times. Geoff, the other question – Rob, a question for you. In terms of – you mentioned the $2 million repricing of previously booked, recognized con sales. Can you give us some perspective, or maybe with respect to either – what you ended up achieving as a realized price for your major metals in the third quarter and/or asked another way, what have you provisionally priced your receivables at, at the end of the quarter because we will, I assume, also be subjected to some potential negative swings to revenues in the fourth quarter?

That is correct, with silver and the base metal declining further in October and November, if things stay the same, then we will be recording negative sales adjustments of provisionally priced third quarter sales that are finally priced in the fourth quarter. I can’t give you those realized prices Steven, but silver we have reached 15.48. This is what the average realized price was in the third quarter. Silver was 15.48, zinc was 21.79, lead was 19.41, (inaudible) well above the average because of the benefit of our hedge books, copper was right around the average of 77.74, and gold came in at 6.81.

Our provisional pricing adjustment would have been based on the September 30 closing prices, and that's not on the realized averages during the quarter.

That’s correct. From memory, it was right around $13 is where we would have provisioning priced. Steven Butler – Canaccord Adams: So, is that pricing you obtained and realized including the benefits of hedging? These prices, therefore, are not necessarily the prices at which you carry concentrate sales receivables into the fourth quarter, not necessarily, correct?

That’s correct. So, the provisionally priced metal is marked to market at September 30 at the closing prices on September 30. Steven Butler – Canaccord Adams: Okay.

And the realized prices I talked about are cash realized. Steven Butler – Canaccord Adams: Right, so maybe I could talk with later maybe to get a sense of the metals content, or volumes I guess provisionally prices. I guess I can just simply pick up Bloomberg September 30 pricing, just wouldn’t mind knowing the volumes, that’s all.

Sure absolutely, probably give me a call after. Steven Butler – Canaccord Adams: Yeah, thanks very much.

Thank you. Our next question is from the line of Haytham Hodaly with Salman Partners, please go ahead. Haytham Hodaly – Salman Partners: I think I would also get those volumes. That would be very helpful as well. Just two, three quick questions actually, just simple ones. You’re exploration budget then Q4, your expense exploration, you expect that to decrease from levels seen in Q3?

This is Michael. Yeah, sure, especially the Greenfield part will obviously decrease, keeping – going on with some projects which are immediately important for our 2009 production. The same obviously for the Brownfield project, everything is concentrating on 2009, and early 2010 production. But the spending will decrease, yes. Haytham Hodaly – Salman Partners: So, $1.5 million in Q3, maybe $1 million in Q4 certainly?

I think our overall exploration budget and a portion of that exploration is allocated within our operating costs and only a portion appears as a separate – the Greenfield is what you see as the separate line item on the income statement. Our annual budget for exploration, including those two items, is about $13.5 million for 2008; divided roughly evenly between the four quarters, which would be in the neighborhood of about $3 million and a bit per quarter. I think you could safely assume that we’ll save half of that number over the balance of the year. Haytham Hodaly – Salman Partners: Okay, fair enough. Next question just with regards to CapEx outlook for Q4, you give us your budgets for the year for Huaron, Morococha, La Colorada, etc., and I do appreciate that. What do you see is your final number for Q4 in terms of budget expenditures right now?

(inaudible) I don’t have that number handy in front of me at the moment but perhaps if you could give Rob a call after the meeting, I’m sure he can give that to you. Haytham Hodaly – Salman Partners: Sure, I’ll do that. And the only other thing I guess I would ask, your G&A, now you made this cuts, are you going to see a hit because of severance, those kinds of stuff, or is that coming at the mine level or at the corporate level?

Yes, we will be incurring some indemnity expenses for sure in the fourth quarter as we deal with the layoffs. My estimate on the magnitude of that between all our operations is probably in the $1.5 million range. How we account for that, we haven’t yet put our thought process to that, whether we’ll segregate it as a separate line item, whether we’ll put it in G&A or whether we’ll leave it at the operating level. Haytham Hodaly – Salman Partners: Okay. That was great. Thank you.

You’re welcome.

All right, thank you. Again our next question's from the line of Craig West with GMP Securities. Please go ahead with your question. Craig West – GMP Securities: Thanks, Geoff. Just a couple of quick questions. Maybe, I don’t mean to be (inaudible) but just on the costs there and the increase in guidance for full-year 2008, just trying to make sure I have the right feel for where that increase in cost is coming from. You made one comment about increasing energy cost, I guess, at Huaron at $0.33. Is that an ongoing impact going forward that we expect to see, and why no impact at Quiruvilca with that?

Yes, this is Steve. I can answer that one. At Huaron we have a different power supply contract. It’s a newer contract than we have at either Morococha or Quiruvilca. That contract is subject to marginal power rates in the country. When the power supply capabilities fall below what the hydroelectric dams can deliver and the gas turbines can deliver, they start to power up diesel generators and you generally have to pay depending on the contract the marginal power rate. We were subjected at we’re all under our contract to 100% of that power under that rate. What we’re seeing is this month that marginal rate is dropping back. They’re setting down diesel generators, they’re firing back up the hydroelectric dams, we expect dramatic decreases in that $0.33 cost during the fourth quarter. Craig West – GMP Securities: Well, I guess if that’s a chunk of Q3 then and reducing impact going forward, the bulk of the increasing guidance is due to just the decline in base metal pricing then?

That’s correct. Craig West – GMP Securities: Okay. The other question is more specific to Peru in general. You made some comment about some slowdowns at Morococha due to labor interruptions. There was some news that came out at random during the last couple of months about disruptions and some protesting that was taking place. Any impacts at all there? Any other sort of whisperings of labor unrest that you’d at times see across the country in Peru and any impact there on your operations?

Yes, Craig, Peru, in my opinion, is going to go through a fairly difficult period going forward. 65% of their GDP is mine or mining-related. And I was just down there a couple of weeks ago and unfortunately the country had not, in my view, didn’t look prepared for what was about to happen with respect to how the mining industry was going to respond to lower prices. We’ve seen just this week, in addition to our own announced layoffs with our operations, the Doe Run Mining Company has laid off people from the La Oroya smelter, Vulcan [ph] Zinc Company has laid off people at Cerro de Pasco and pulled back on their exploration. Casapalca, another mining company located on the central highway, as well as Glencore have all kind of simultaneously announced the measures and steps to respond to current pricing environment. And I think it is going to send a bit of a shockwave through the labor markets in Peru because I truly don’t believe that the government had properly – or should they properly had started to prepare their populace for the likely results. I think that has the potential to be disruptive. There’s just no question when a wave of layoffs hit a population that there is the potential for labor disruption as well as strike action. To this point, we haven’t had a strike. Things are at least as of today responding and operating normally at Huaron, at Morococha, at Quiruvilca. But there are in the background meetings going on with the national unions, et cetera, and there will be in my expectation some response. The severity and duration. that’s a bit of a who knows, but I think we’ve done the best we can to manage the expectations of our employees and I hope that if there are to be any disruptions that they would be short-lived, but there is a risk there at the moment. Craig West – GMP Securities: That’s helpful. And maybe kind of continuing along the lines of the smelting contracts that you’ve got, TC/RCs, any major changes that you’ve seen there quarter to quarter? Is there anything in your contracts that a dramatic change in metal prices can trigger some re-negotiation in any way? When do you have contracts coming due for sort of the re-negotiation or re-signing with the smelters?

Craig, I'll address that. Most of our major contracts are in place through the end of 2009 and are actually good contracts relative to the current market. The current grade [ph] markets are changing dramatically as you would expect as the availability of material becomes less and less certain. So we’re moving from projected surpluses into potential deficits in a hurry. And so, we are monitoring the market, but at this point in time, we have a lot of material available to go to smelters with for the time being anyway. Craig West – GMP Securities: Can you give us sort of a number that you hit in the quarter then for treatment charges per ton in refining there or –?

Craig, it's a pretty detailed question that varies across contracts by product. Craig West – GMP Securities: Do you have [ph] a general number that you kind of had on average for the quarter or just the same numbers again?

I’ll be happy to walk you through with you in more detail after the call, I think that’ll be better. Craig West – GMP Securities: One final question then on Manantial Espejo, you’ve mentioned about the potential for a little bit of cost creep there on the CapEx side. Can you just remind us again how much has been spent to date, how much still needs to be spent, and how much has been committed?

Yes, give me one second. As of today, we’ve spent $210 million and our estimate to complete is $225 million. So we have approximately $15 million more to go and the majority of that or a big chunk of that is really operating cost, pre-receipt of our first expected revenue while Steve mentioned that we were anticipating pouring our first dore in December, it is very unlikely that we'll see any payments for that metal produced until January. So, we still have a number of weeks of basically full operating cost to cover until we get a sustainable revenue stream. Craig West – GMP Securities: Do you get the VAT back all at once or is that an over –

It comes back as we export our dore product. So, it’s likely going to come in our estimate at the moment is over in about a year’s time. Craig West – GMP Securities: That's it for me. Thanks for your time.

Thanks, Craig.

Thank you. Our next question's from the line of David Christie with Scotia Capital. Please go ahead with your question, sir. David Christie – Scotia Capital: Good morning guys. Just quickly, I was wondering if you can give me the price assumptions you're using for your guidance for the year for Q4, and your metal price assumptions to get your cost guidance?

That was – I mean, the $7 an ounce for Q4 is based on current metal prices. David Christie – Scotia Capital: So, using $7.20 gold and $9.25 silver?

Yes, and then the key after going [ph] to the cost side is obviously the base metal prices and that’s $1150 per ton zinc and $1300 per ton lead is what we have used. David Christie – Scotia Capital: Okay, perfect. And is there any chance getting the payable or sold metal you have in the quarter as opposed to the contained?

I can certainly give you that number. I don’t have it in front of me now, but I can – we have that number and I can certainly provide it to you. David Christie – Scotia Capital: That'll be great as well as to concentrate about what you’re talking about earlier. So you got no TC/RC and renegotiates for 2009, but you're at terms that are still under today’s market or –?

That’s right. That’s across most of our products. David Christie – Scotia Capital: Okay good. I guess that's it for me. All my other questions were answered. Thank you.

Thanks, David.

(Operator instructions) Our next question is from Kurt Miller [ph], a private investor, please go ahead sir.

Yes. Has there been any consideration given to share buyback with the hopes of reissuance two or three years down the road?

Hi, Kurt. At this point in time, our primary focus is going to be to get Manantial up and running, look at our plans under the new metal price environment, and ensure that we have adequate and sufficient liquidity on a go-forward basis. Our second goal with that liquidity and with the facility that we recently put in place is to look for strategic opportunities to grow the business. My belief that that second objective is by far the best way the best way we can create additional value for Pan Am's shareholders in the long-term. There are – and I believe will continue to be some very valuable opportunities for us to participate in if we maintain our financial health. And at this stage, we have not considered investing our liquidity in the share repurchase.

Okay. Thank you.

All right, thank you. And ladies gentleman, at this time we would like to give participants a final opportunity to ask any additional questions. (Operator instructions) Mr. Burns, there are no further questions at this time. Please continue with any closing comment.

Okay. Well, thank you, ladies and gentlemen, for joining us this morning. I look forward to reporting to you again early in January when we can talk even more definitively about some of the actions that we’ve taken today. And I just like to repeat I am confident that the measures we’ve taken and the team we have in place will allow us to not only to survive these turbulent times but also to thrive and continue to grow. Thank you.

All right. Thank you, ladies and gentlemen. This does conclude the Pan American Silver this quarter 2008 earnings conference call. This conference call will be available for replay after 11:30 EST today through November 20th at midnight EST. You may access the replay system at any time by dialing 1-800-406-7325 or 303-590-3030, and enter the access code of 3931521. We thank you very much for your participation and you may now disconnect. Have a very pleasant rest of your day.