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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 40-FooREGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934

OR ýýANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2015 Commission file number: 1-13422

AGNICO EAGLE MINES LIMITED (ExactnameofRegistrantasspecifiedinitscharter)

Ontario, Canada 1040 98-0357066(Provinceofotherjurisdictionofincorporationor

organization) (PrimaryStandardIndustrialClassificationCodeNumber) (I.R.S.EmployerIdentificationNumber)

145 King Street East, Suite 400 Toronto, Ontario, Canada M5C 2Y7

(416) 947-1212 (AddressandtelephonenumberofRegistrant'sprincipalexecutiveoffices)

Davies Ward Phillips & Vineberg LLP 900 Third Avenue, 24th Floor, New York, New York 10022

Attention: Scott D. Fisher (212) 588-5500

(Name,address(includingzipcode)andtelephonenumber(includingareacode)ofagentforserviceintheUnitedStates)

SecuritiesregisteredortoberegisteredpursuanttoSection12(b)oftheAct:

Common Shares, without parvalue

New York Stock Exchange

(TitleofClass) (Nameofexchangeonwhichregistered)

SecuritiesregisteredortoberegisteredpursuanttoSection12(g)oftheAct:None

(TitleofClass)

SecuritiesforwhichthereisareportingobligationpursuanttoSection15(d)oftheAct:None

(TitleofClass)

Forannualreports,indicatebycheckmarktheinformationfiledwiththisForm:

ýAnnualinformationformýAuditedannualfinancialstatements

Indicatethenumberofoutstandingsharesofeachoftheissuer'sclassesofcapitalorcommonstockasofthecloseoftheperiodcoveredbytheannualreport.

218,028,368CommonSharesasofDecember31,2015

Indicateby check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding12months(orforsuchshorterperiodthattheRegistrantwasrequiredtofilesuchreports)and(2)hasbeensubjecttosuchfilingrequirementsforthepast90days.

YesýNoo

IndicatebycheckmarkwhethertheRegistranthassubmittedelectronicallyandpostedonitscorporateWebsite,ifany,everyInteractiveDataFilerequiredtobesubmittedand posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that theRegistrantwasrequiredtosubmitandpostsuchfiles).

YesoNoo

EXPLANATORY NOTE

AgnicoEagleMinesLimited("AgnicoEagle"orthe"Company")isaCanadianissuereligibletofileitsannualreportpursuanttoSection13oftheSecuritiesExchangeActof1934,asamended(the"ExchangeAct"),onForm40-Fpursuanttothemulti-jurisdictionaldisclosuresystemoftheExchangeAct.TheCompanyisa"foreignprivateissuer"asdefinedinRule405undertheSecuritiesActof1933,asamended.EquitysecuritiesoftheCompanyareaccordinglyexemptfromSections14(a),14(b),14(c),14(f)and16oftheExchangeActpursuanttoRule3a12-3.

FORWARD-LOOKING INFORMATION

This Annual Report on Form 40-F and the exhibits attached hereto (the "Form 40-F") contain "forward-looking statements" within the meaning of theUnited States Private Securities Litigation ReformAct of 1995. These statements relate to, among other things, the Company's plans, objectives, expectations,estimates, beliefs, strategies and intentions and can generally be identified by the use of words such as "anticipate", "believe", "budget", "could", "estimate","expect","forecast","intend","likely","may","plan","project","schedule","should","target","will","would"orothervariationsofthesetermsorsimilarwords.Forward-lookingstatementsinthisForm40-Finclude,butarenotlimitedto,thefollowing:

• theCompany'soutlookfor2016andfutureperiods;

• statementsregardingfutureearnings,andthesensitivityofearningstogoldandothermetalprices;

• anticipated levels or trends for prices of gold and by-product metals mined by the Companyor for exchange rates betweencurrenciesinwhichcapitalisraised,revenueisgeneratedorexpensesareincurredbytheCompany;

• estimatesoffuturemineralproductionandsales;

• estimates of future costs, including mining costs, total cash costs per ounce, all-in sustaining costs per ounce, minesite costs per tonne andothercosts;

• estimatesoffuturecapitalexpenditures,explorationexpendituresandothercashneeds,andexpectationsastothefundingthereof;

• statements regarding the projected exploration, development and exploitation of certain ore deposits, including estimates of exploration,developmentandproductionandothercapitalcostsandestimatesofthetimingofsuchexploration,developmentandproductionordecisionswithrespectthereto;

• estimatesofmineralreservesandmineralresourcesandtheirsensitivitiestogoldpricesandotherfactors,oregradesandmineralrecoveriesandstatementsregardinganticipatedfutureexplorationresults;

• estimatesofcashflow;

• estimatesofminelife;

• anticipatedtimingofeventswithrespecttotheCompany'sminesites,minedevelopmentprojectsandexplorationprojects;

• estimatesoffuturecostsandotherliabilitiesforenvironmentalremediation;

• statements regarding anticipated legislation and regulations, including with respect to climate change, and estimates of the impact on theCompany;and

• otheranticipatedtrendswithrespecttotheCompany'scapitalresourcesandresultsofoperations.

Forward-lookingstatementsarenecessarilybaseduponanumberoffactorsandassumptionsthat,whileconsideredreasonablebyAgnicoEagleasofthedateofsuchstatements,areinherentlysubjecttosignificantbusiness,economicandcompetitiveuncertaintiesandcontingencies.ThefactorsandassumptionsofAgnicoEagleuponwhichtheforward-lookingstatementsinthisForm40-Farebased,andwhichmayprovetobeincorrect,includetheassumptionssetoutelsewhereinthis Form40-F as well as: that there are no significant disruptions affectingAgnico Eagle's operations, whether due to labour disruptions, supply disruptions,damageto equipment, natural or man-madeoccurrences, miningor milling issues, political changes, title issues orotherwise; that permitting, development andexpansionateachofAgnicoEagle'sminesandminedevelopment

projectsproceedonabasisconsistentwithexpectations,andthatAgnicoEagledoesnotchangeitsexplorationordevelopmentplansrelatingtosuchprojects;thattheexchangeratesbetweentheCanadiandollar,Euro,MexicanpesoandtheU.S.dollarwillbeapproximatelyconsistentwithcurrentlevelsorassetoutinthisForm40-F;thatpricesforgold,silver,zincandcopperwillbeconsistentwithAgnicoEagle'sexpectations;thatpricesforkeyminingandconstructionsupplies,includinglabourcosts,remainconsistentwithAgnicoEagle'sexpectations;thatproductionmeetsexpectations;thatAgnicoEagle'scurrentestimatesofmineralreserves, mineral resources, mineral grades and mineral recoveries are accurate; that there are no material delays in the timing for completion of developmentprojects;andthattherearenomaterialvariationsinthecurrenttaxandregulatoryenvironmentthataffectAgnicoEagle.

Theforward-lookingstatementsintheForm40-FreflecttheCompany'sviewsasatthedatehereofandinvolveknownandunknownrisks,uncertaintiesandother factors which could cause the actual results, performance or achievements of the Company or industry results to be materially different fromany futureresults,performanceorachievementsexpressedorimpliedbysuchforward-lookingstatements.Suchfactorsinclude,amongothers,theriskfactorssetoutunder"RiskFactors" onpage86of the Company's annual information formfor the year endedDecember 31, 2015, whichis filed as Exhibit 99.1 to this Form40-Fandincorporatedbyreferenceherein(the"AIF").Giventheseuncertainties,readersarecautionednottoplaceunduerelianceontheseforward-lookingstatements,whichspeakonlyasofthedatemade.Exceptasotherwiserequiredbylaw,theCompanyexpresslydisclaimsanyobligationorundertakingtoreleasepubliclyanyupdatesorrevisionstoanysuchstatementstoreflectanychangeintheCompany'sexpectationsoranychangeinevents,conditionsorcircumstancesonwhichanysuchstatementisbased.ThisForm40-Fcontainsinformationregardinganticipatedtotalcashcostsperounce,all-insustainingcostsperounceandminesitecostspertonneinrespectoftheCompanyoratcertainoftheCompany'sminesandminedevelopmentprojects. TheCompanybelievesthatthesegenerallyacceptedindustry measures are realistic indicators of operating performance and are useful in allowing year over year comparisons. Investors are cautioned that thisinformationmaynotbesuitableforotherpurposes.

CURRENCY

AgnicoEaglepresentsitsconsolidatedfinancialstatementsinUnitedStatesdollars.AlldollaramountsinthisForm40-FarestatedinUnitedStatesdollars("U.S.dollars","$"or"US$"),exceptwhereotherwiseindicated.OnMarch15,2016,thenoonexchangerate(asreportedbytheBankofCanada)ofUnitedStatesdollarsintoCanadiandollars("C$")wasUS$1.00equalsC$1.3359.

NOTE TO INVESTORS CONCERNING ESTIMATES OF MINERAL RESERVES AND MINERAL RESOURCES

ThemineralreserveandmineralresourceestimatescontainedinthisForm40-FhavebeenpreparedinaccordancewiththeCanadiansecuritiesregulatoryauthorities'(the"CSA")NationalInstrument43-101StandardsofDisclosureforMineralProjects("NI43-101").ThesestandardsaresimilartothoseusedbytheUnitedStatesSecuritiesandExchangeCommission's(the"SEC")IndustryGuideNo.7,asinterpretedbyStaffattheSEC("Guide7").However,thedefinitionsinNI43-101differincertainrespectsfromthoseunderGuide7.Accordingly,mineralreserveinformationcontainedorincorporatedbyreferencehereinmaynotbecomparabletosimilarinformationdisclosedbyU.S.companies.UndertherequirementsoftheSEC,mineralizationmaynotbeclassifiedasa"reserve"unlessthedeterminationhasbeenmadethatthemineralizationcouldbeeconomicallyandlegallyproducedorextractedatthetimethereservedeterminationismade.TheSECdoesnotrecognizemeasuresof"mineralresource".

Themineralreservefigurespresentedhereinareestimates,andnoassurancecanbegiventhattheanticipatedtonnagesandgradeswillbeachievedorthattheindicated level of recovery will be realized. The Company does not include equivalent gold ounces for byproduct metals contained in mineral reserves in itscalculationofcontainedounces.

Cautionary Note to Investors Concerning Estimates of Measured and Indicated Mineral Resources

TheForm40-Fusestheterms"measuredmineralresources"and"indicatedmineralresources".Investorsareadvisedthatwhile thosetermsarerecognizedandrequiredbyCanadianregulations,theSECdoesnotrecognizethem.Investors are cautioned not to assume that any part or all of mineral deposits in thesecategories will ever be converted into mineral reserves .

Cautionary Note to Investors Concerning Estimates of Inferred Mineral Resources

TheForm40-Fusestheterm"inferredmineralresources".InvestorsareadvisedthatwhilethistermisrecognizedandrequiredbyCanadianregulations,theSECdoesnotrecognizeit."Inferredmineralresources"haveagreatamountofuncertaintyastotheirexistenceandastotheireconomicandlegalfeasibility.Itcannotbe assumedthat any part or all of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferredmineralresourcesmaynotformthebasisoffeasibilityorpre-feasibilitystudies,exceptinrarecases.Investors are cautioned not to assume that any part or allof an inferred mineral resource exists, or is economically or legally mineable .

NOTE TO INVESTORS CONCERNING CERTAIN MEASURES OF PERFORMANCE

TheForm40-Fpresentscertainmeasures,including"totalcashcostsperounce","all-insustainingcostsperounce"and"minesitecostspertonne",thatarenotrecognizedmeasuresunderUnitedStatesgenerallyacceptedaccountingprinciples("USGAAP").Thisdatamaynotbecomparabletodatapresentedbyothergoldproducers.ForareconciliationofthesemeasurestothefigurespresentedintheconsolidatedfinancialstatementspreparedinaccordancewithUSGAAP,seethemanagement'sdiscussionandanalysisfortheyearendedDecember31,2015,whichisfiledasExhibit99.3tothisForm40-Fandincorporatedbyreferenceherein(the"AnnualMD&A").TheCompanybelievesthatthesegenerallyacceptedindustrymeasuresarerealisticindicatorsofoperatingperformanceandareusefulinallowing year over year comparisons. However, these non-USGAAPmeasures should be considered together with other data prepared in accordance with USGAAP,andthesemeasures,takenbythemselves,arenotnecessarilyindicativeofoperatingcostsorcashflowmeasurespreparedinaccordancewithUSGAAP.ThisForm40-Falso contains information as to estimated future total cash costs per ounce, all-in sustaining costs per ounce andminesite costs per tonne. Theestimatesoftotalcashcostsperounce,all-insustainingcostsperounceandminesitecostspertonnearebaseduponthetotalcashcostsperounce,all-insustainingcostsperounceandminesitecostspertonnethattheCompanyexpectstoincurtominegoldatitsprojectsand,consistentwiththereconciliationprovided,donotincludeproductioncostsattributabletoaccretionexpenseandotherassetretirementcosts,whichwillvaryovertimeaseachprojectisdevelopedandmined.Itisthereforenotpracticabletoreconciletheseforward-lookingnon-USGAAPfinancialmeasurestothemostcomparableUSGAAPmeasure.

DISCLOSURE CONTROLS AND PROCEDURES

TheCompany'smanagement,withtheparticipationoftheCompany'sChiefExecutiveOfficerandChiefFinancialOfficer,evaluatedtheeffectivenessoftheCompany's disclosure controls and procedures as of December 31, 2015 pursuant to Rule 13a-15 under the Exchange Act. In designing and evaluating thedisclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide onlyreasonableassuranceofachievingthedesiredcontrolobjectives.Inaddition,thedesignofdisclosurecontrolsandproceduresmustreflectthefactthatthereareresourceconstraintsandthatmanagementisrequiredtoapplyitsjudgmentinevaluatingthebenefitsofpossiblecontrolsandproceduresrelativetotheircosts.

Basedonsuchevaluation, theCompany's Chief Executive Officer andChief Financial Officer concludedthat, as of December 31, 2015, the Company'sdisclosurecontrolsandproceduresweredesignedatareasonableassurancelevelandwereeffectivetoprovidereasonableassurancethatinformationtheCompanyis required to disclose in reports that the Company files or submits under the Exchange Act is recorded, processed, summarized and reported within the timeperiodsspecifiedinSECrulesandforms,andthatsuchinformationisaccumulatedandcommunicatedtotheCompany'smanagement,includingtheCompany'sChiefExecutiveOfficerandChiefFinancialOfficer,asappropriate,toallowtimelydecisionsregardingrequireddisclosure.

MANAGEMENT'S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

ManagementoftheCompanyisresponsibleforestablishingandmaintainingadequateinternalcontroloverfinancialreporting.Internalcontroloverfinancialreportingisaprocessdesignedby,orunderthesupervisionof,theCompany'sChiefExecutiveOfficerandChiefFinancialOfficerandeffectedbytheCompany'sboard of directors (the "Board"), management and other personnel to provide reasonable assurance regarding the reliability of financial reporting and thepreparationoffinancialstatementsforexternalpurposesinaccordancewithgenerallyacceptedaccountingprinciples.Becauseofitsinherentlimitations,internalcontroloverfinancialreportingmaynotpreventordetectmisstatements.Also,projectionsofanyevaluationofeffectivenesstofuture

periodsaresubjecttoriskthatcontrolsmaybecomeinadequatebecauseofchangesinconditions,orthatthedegreeofcompliancewiththepoliciesorproceduresmaydeteriorate.

TheCompany'smanagement, includingtheCompany'sChiefExecutiveOfficerandChiefFinancial Officer, assessedtheeffectiveness oftheCompany'sinternal control over financial reporting as of December 31, 2015. In making this assessment, the Company's management used the criteria set out by theCommittee of Sponsoring Organizations of the Treadway Commission in InternalControl —IntegratedFramework . Based uponits assessment, managementconcludedthat,asofDecember31,2015,theCompany'sinternalcontroloverfinancialreportingwaseffective.

The effectiveness of the Company's internal control over financial reporting as of December 31, 2015 has been audited by Ernst & Young LLP, anindependentregisteredpublicaccountingfirm,asstatedinitsattestationreportonpage2oftheCompany'sAnnualAuditedConsolidatedFinancialStatements,whicharefiledasExhibit99.2tothisForm40-Fandincorporatedbyreferenceherein(the"AnnualFinancialStatements").

The Company will continue to periodically review its disclosure controls and procedures and internal control over financial reporting and may makemodificationsfromtimetotimeasconsiderednecessaryordesirable.

ATTESTATION REPORT OF THE REGISTERED PUBLIC ACCOUNTING FIRM

Ernst&YoungLLP'sattestationreportonmanagement's assessmentoftheCompany'sinternalcontroloverfinancial reportingisfoundonpage2oftheAnnualFinancialStatements.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

ManagementregularlyreviewsitssystemofinternalcontroloverfinancialreportingandmakeschangestotheCompany'sprocessesandsystemstoimprovecontrols and increase efficiency, while ensuring that the Company maintains an effective internal control environment. Changes may include such activities asimplementingnew,moreefficientsystems,consolidatingactivities,andmigratingprocesses.

TherewasnochangeintheCompany'sinternalcontroloverfinancialreportingthatoccurredduringtheperiodcoveredbythisForm40-Fthathasmateriallyaffected,orisreasonablylikelytomateriallyaffect,theCompany'sinternalcontroloverfinancialreporting.

IDENTIFICATION OF THE AUDIT COMMITTEE

The Board has a separately-designated standing Audit Committee established in accordance with section 3(a)(58)(A) of the Exchange Act. The AuditCommittee is composed of Dr. Leanne Baker (Chair), Mr. Mel Leiderman, Dr. Sean Riley and Mr. Jamie Sokalsky, as described under "AuditCommittee—CompositionoftheAuditCommittee"onpage104oftheAIF.

AUDIT COMMITTEE FINANCIAL EXPERT

TheBoardhasdeterminedthattheCompanyshallhaveatleastone"auditcommitteefinancialexpert"(asdefinedinparagraph(8)ofGeneralInstructionBtoForm40-F)andthatMr.MelLeidermanandMr.JamieSokalskyaretheCompany's"auditcommitteefinancialexperts"servingontheAuditCommitteeoftheBoard.EachoftheAuditCommitteefinancialexpertsis"independent"underapplicablelistingstandards.

PRINCIPAL ACCOUNTANT FEES AND SERVICES

Ernst&YoungLLPservedastheCompany'sindependentpublicaccountantforeachofthefiscalyearsinthetwo-yearperiodendedDecember31,2015.ForadescriptionofthetotalamountbilledtotheCompanybyErnst&YoungLLPforservicesperformedinthelasttwofiscalyearsbycategoryofservice(auditfees,audit-relatedfees,taxfeesandallotherfees),see"AuditCommittee—ExternalAuditorServiceFees"onpage105oftheAIF.Noaudit-relatedfees,taxfeesorothernon-auditfeeswereapprovedbytheAuditCommitteepursuanttoparagraph(c)(7)(i)(C)ofRule2-01ofRegulationS-X.

AUDIT COMMITTEE PRE-APPROVAL POLICIES AND PROCEDURES

For a description of the pre-approval policies and procedures of the Company's Audit Committee, see "Audit Committee —Pre-Approval Policies andProcedures"onpage104oftheAIF.

CODE OF ETHICS

TheCompanyhasa"codeofethics"(asdefinedinparagraph(9)ofGeneralInstructionBtoForm40-F)that appliestoitsChiefExecutiveOfficer,ChiefFinancialOfficer,principalaccountingofficer,controllerandpersonsperformingsimilarfunctions.TheCompany'scodeofethicsisavailableontheCompany'swebsiteatwww.agnicoeagle.comor,withoutcharge,uponrequestfromtheCorporateSecretary,AgnicoEagleMinesLimited,Suite400,145KingStreetEast,Toronto,OntarioM5C2Y7(telephone416-947-1212).

OFF-BALANCE SHEET ARRANGEMENTS

Notapplicable.

CONTRACTUAL OBLIGATIONS

FortabulardisclosureoftheCompany'scontractualobligations,seepage14oftheAnnualMD&Aundertheheading"LiquidityandCapitalResources".

MINE SAFETY DISCLOSURE

Notapplicable.

CORPORATE GOVERNANCE

TheCompanyissubjecttoavarietyofcorporategovernanceguidelinesandrequirementsenactedbytheTorontoStockExchange(the"TSX"),theCanadiansecuritiesregulatoryauthorities,theNewYorkStockExchange(the"NYSE")andtheSEC.TheCompanyislistedontheNYSEand,althoughtheCompanyisnotrequired to comply with most of the NYSE corporate governance requirements to which the Company would be subject if it were a U.S. corporation, theCompany's governancepractices differ fromthose required of U.S. domestic issuers in only the following respects. The NYSErules for U.S. domestic issuersrequireshareholderapprovalofallequitycompensationplans(asdefinedintheNYSErules)regardlessofwhethernewissuances,treasurysharesorsharesthattheCompanyhaspurchasedintheopenmarketareused.TheTSXrulesrequireshareholderapprovalofsharecompensationarrangementsinvolvingnewissuancesofshares,andofcertainamendmentstosucharrangements,butdonotrequiresuchapprovalifthecompensationarrangementsinvolveonlysharespurchasedintheopenmarket.TheNYSErulesforU.S.domesticissuersalsorequireshareholderapprovalofcertaintransactionsorseriesofrelatedtransactionsthatresultintheissuanceofcommonshares, or securities convertible intoor exercisable for commonshares, that have, or will haveuponissuance, votingpowerequal toor inexcessof20%ofthevotingpoweroutstandingpriortothetransactionoriftheissuanceofcommonshares,orsecuritiesconvertibleintoorexercisableforcommonshares,are,orwillbeuponissuance,equaltoorinexcessof20%ofthenumberofcommonsharesoutstandingpriortothetransaction.TheTSXrulesrequireshareholderapprovalofacquisitiontransactionsresultingindilutioninexcessof25%.TheTSXalsohasbroadgeneraldiscretiontorequireshareholderapprovalinconnectionwithanyissuancesoflistedsecurities.TheCompanycomplieswiththeTSXrulesdescribedinthisparagraph.

UNDERTAKING

AgnicoEagleundertakestomakeavailable,inpersonorbytelephone,representativestorespondtoinquiriesmadebytheSECstaff,andtofurnishpromptly,whenrequestedtodosobytheSECstaff,informationrelatingto:thesecuritiesinrelationtowhichtheobligationtofileanannualreportonForm40-Farises;ortransactionsinsaidsecurities.

INCORPORATION BY REFERENCE

This Form40-F, which includes the exhibits filed herewith (other than the section of the AIF entitled "Ratings"), is incorporated by reference into theCompany'sRegistrationStatementsonFormF-3D(registrationno.333-190888)andFormS-8(registrationnos.333-130339and333-152004).EachoftheAIF(otherthanthesectionentitled"Ratings"),theAnnualFinancialStatementsandtheAnnualMD&AisincorporatedbyreferenceasanexhibittotheCompany'sRegistrationStatementonFormF-10(registrationno.333-206498).

EXHIBIT INDEX

Exhibit Description99.1

AnnualInformationFormoftheCompanyfortheyearendedDecember31,2015.

99.2

AnnualAuditedConsolidatedFinancialStatementsoftheCompany,includingthenotesthereto,asatDecember31,2015and2014andforeachoftheyearsinthethree-yearperiodendedDecember31,2015,togetherwiththeauditors'reportthereonandtheauditors'reportoninternalcontroloverfinancialreporting.

99.3

Management'sDiscussionandAnalysisfortheyearendedDecember31,2015.

99.4

CertificationoftheChiefExecutiveOfficerrequiredbyRule13a-14(a)orRule15d-14(a),pursuanttoSection302oftheSarbanes-OxleyActof2002.

99.5

CertificationoftheChiefFinancialOfficerrequiredbyRule13a-14(a)orRule15d-14(a),pursuanttoSection302oftheSarbanes-OxleyActof2002.

99.6

CertificationoftheChiefExecutiveOfficerpursuanttoTitle18,UnitedStatesCode,Section1350asadoptedpursuanttoSection906oftheSarbanes-OxleyActof2002.

99.7

CertificationoftheChiefFinancialOfficerpursuanttoTitle18,UnitedStatesCode,Section1350asadoptedpursuanttoSection906oftheSarbanes-OxleyActof2002.

99.8

ConsentofIndependentRegisteredPublicAccountingFirm.

99.9

ConsentofDanielDoucet.

99.10

ConsentofDonaldGervais.

99.11

ConsentofLouiseGrondin.

99.12

ConsentofTimHaldane.

99.13

ConsentofPaulCousin.

99.14

ConsentofFrancisBrunet.

99.15

ConsentofDominiqueGirard.

99.16

ConsentofChristianProvencher.

SIGNATURES

PursuanttotherequirementsoftheExchangeAct,theCompanycertifiesthatitmeetsalloftherequirementsforfilingonForm40-Fandhasdulycausedthisannualreporttobesignedonitsbehalfbytheundersigned,theretodulyauthorized.

Toronto,CanadaMarch23,2016

AGNICO EAGLE MINES LIMITED

by /s/DAVIDSMITH

DavidSmithSeniorVice-President,FinanceandChiefFinancialOfficer

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EXPLANATORYNOTEFORWARD-LOOKINGINFORMATIONCURRENCYNOTETOINVESTORSCONCERNINGESTIMATESOFMINERALRESERVESANDMINERALRESOURCESNOTETOINVESTORSCONCERNINGCERTAINMEASURESOFPERFORMANCEDISCLOSURECONTROLSANDPROCEDURESMANAGEMENT'SANNUALREPORTONINTERNALCONTROLOVERFINANCIALREPORTINGATTESTATIONREPORTOFTHEREGISTEREDPUBLICACCOUNTINGFIRMCHANGESININTERNALCONTROLOVERFINANCIALREPORTINGIDENTIFICATIONOFTHEAUDITCOMMITTEEAUDITCOMMITTEEFINANCIALEXPERTPRINCIPALACCOUNTANTFEESANDSERVICESAUDITCOMMITTEEPRE-APPROVALPOLICIESANDPROCEDURESCODEOFETHICSOFF-BALANCESHEETARRANGEMENTSCONTRACTUALOBLIGATIONSMINESAFETYDISCLOSURECORPORATEGOVERNANCEUNDERTAKINGINCORPORATIONBYREFERENCEEXHIBITINDEXSIGNATURES


Exhibit 99.1

Annual Information Form for the year ended December 31, 2015

Dated as of March 15, 2016


ANNUAL INFORMATION FORM

Table of Contents

Page INTRODUCTORYNOTES ii

CurrencyandExchangeRates ii

Forward-LookingStatements ii

PresentationofFinancialInformation iv

NotetoInvestorsConcerningEstimatesofMineralReservesandMineralResources iv

NotetoInvestorsConcerningCertainMeasuresofPerformance iv

SELECTEDFINANCIALDATA 1

GLOSSARYOFSELECTEDMININGTERMS 2

CORPORATESTRUCTURE 9

DESCRIPTIONOFTHEBUSINESS 11

GENERALDEVELOPMENTOFTHEBUSINESS 12

OPERATIONSANDPRODUCTION 16

BusinessUnitsandForeignOperations 16

NorthernBusiness 16

SouthernBusiness 59

RegionalExplorationActivities 70

MineralReservesandMineralResources 70

PrincipalProductsandDistribution 83

Employees 83

CompetitiveConditions 83

SustainableDevelopment 83

EmployeeHealthandSafety 84

Community 84

EnvironmentalProtection 85

RISKFACTORS 86

DIVIDENDS 98

DESCRIPTIONOFCAPITALSTRUCTURE 98

RATINGS 98

MARKETFORSECURITIES 99

DIRECTORSANDOFFICERSOFTHECOMPANY 100

Directors 100

Committees 101

Officers 102

ShareholdingsofDirectorsandOfficers 103

CeaseTradeOrders,Bankruptcies,PenaltiesorSanctions 103

ConflictsofInterest 104

AUDITCOMMITTEE 104

CompositionoftheAuditCommittee 104

RelevantEducationandExperience 104

Pre-ApprovalPoliciesandProcedures 104

ExternalAuditorServiceFees 105

LEGALPROCEEDINGSANDREGULATORYACTIONS 105

INTERESTOFMANAGEMENTANDOTHERSINMATERIALTRANSACTIONS 106

TRANSFERAGENTANDREGISTRAR 106

MATERIALCONTRACTS 106

INTERESTSOFEXPERTS 109

ADDITIONALINFORMATION 109

SCHEDULE"A"AUDITCOMMITTEECHARTEROFTHECOMPANY A-1

i

INTRODUCTORY NOTES Currency and Exchange Rates

Currencies:AgnicoEagleMinesLimited("AgnicoEagle"orthe"Company")presentsitsconsolidatedfinancialstatementsinUnitedStatesdollars.AlldollaramountsinthisAnnualInformationForm("AIF")arestatedinUnitedStatesdollars("U.S.dollars","$"or"US$"),exceptwhereotherwiseindicated.CertaininformationinthisAIFispresentedinCanadiandollars("C$")orEuropeanUnioneuros("Euro"or"€").

ExchangeRates:Thefollowingtablessetout,inCanadiandollars,theexchangeratesfortheU.S.dollar,basedonthenoonbuyingrateasreportedbytheBankofCanada(the"NoonBuyingRate").OnMarch15,2016,theNoonBuyingRatewasUS$1.00equalsC$1.3359.

Year Ended December 31, 2015 2014 2013 2012 2011

High 1.3990 1.1643 1.0697 1.0418 1.0604

Low 1.1728 1.0614 0.9839 0.9710 0.9449

EndofPeriod 1.3840 1.1601 1.0636 0.9949 1.0170

Average 1.2787 1.1045 1.0299 0.9996 0.9891

2016 2015

March

(to March 15) February January December November October September

High 1.3468 1.4040 1.4589 1.3990 1.3360 1.3242 1.3413

Low 1.3215 1.3523 1.3969 1.3360 1.3095 1.2904 1.3147

EndofPeriod 1.3359 1.3523 1.4080 1.3840 1.3333 1.3083 1.3394

Average 1.3344 1.3796 1.4223 1.3705 1.3280 1.3073 1.3267

OnDecember31,2015andMarch15,2016,US$1.00equaled€0.9185and€0.9002,respectively,asreportedbytheEuropeanCentralBank.

Forward-Looking Statements

Forward-LookingStatements:CertainstatementsinthisAIF,referredtohereinas"forward-lookingstatements",constitute"forward-lookinginformation"undertheprovisionsofCanadianprovincialsecuritieslawsandconstitute"forward-lookingstatements"withinthemeaningoftheUnitedStatesPrivateSecuritiesLitigationReformActof1995.Thesestatementsrelateto,amongotherthings,theCompany'splans,objectives,expectations,estimates,beliefs,strategiesandintentionsandcangenerallybeidentifiedbytheuseofwordssuchas"anticipate","believe","budget","could","estimate","expect","forecast","likely","may","plan","project","schedule","should","target","will","would"orothervariationsofthesetermsorsimilarwords.Forward-lookingstatementsinthisAIFinclude,butarenotlimitedto,thefollowing:



• anticipatedlevelsortrendsforpricesofgoldandby-productmetalsminedbytheCompanyorforexchangeratesbetweencurrenciesinwhichcapitalisraised,revenueisgeneratedorexpensesareincurredbytheCompany;


ii

• estimatesoffuturecosts,includingminingcosts,totalcashcostsperounce,all-insustainingcostsperounce,minesitecostspertonneandothercosts;


• statementsregardingtheprojectedexploration,developmentandexploitationofcertainoredeposits,includingestimatesofexploration,developmentandproductionandothercapitalcostsandestimatesofthetimingofsuchexploration,developmentandproductionordecisionswithrespectthereto;






• statementsregardinganticipatedlegislationandregulations,includingwithrespecttoclimatechange,andestimatesoftheimpactontheCompany;and


Forward-lookingstatementsarenecessarilybaseduponanumberoffactorsandassumptionsthat,whileconsideredreasonablebyAgnicoEagleasofthedateofsuchstatements,areinherentlysubjecttosignificantbusiness,economicandcompetitiveuncertaintiesandcontingencies.ThefactorsandassumptionsofAgnicoEagleuponwhichtheforward-lookingstatementsinthisAIFarebased,andwhichmayprovetobeincorrect,includetheassumptionssetoutelsewhereinthisAIFaswellas:thattherearenosignificantdisruptionsaffectingAgnicoEagle'soperations,whetherduetolabourdisruptions,supplydisruptions,damagetoequipment,naturalorman-madeoccurrences,miningormillingissues,politicalchanges,titleissuesorotherwise;thatpermitting,developmentandexpansionateachofAgnicoEagle'sminesandminedevelopmentprojectsproceedonabasisconsistentwithexpectations,andthatAgnicoEagledoesnotchangeitsexplorationordevelopmentplansrelatingtosuchprojects;thattheexchangeratesbetweentheCanadiandollar,Euro,MexicanpesoandtheU.S.dollarwillbeapproximatelyconsistentwithcurrentlevelsorassetoutinthisAIF;thatpricesforgold,silver,zincandcopperwillbeconsistentwithAgnicoEagle'sexpectations;thatpricesforkeyminingandconstructionsupplies,includinglabourcosts,remainconsistentwithAgnicoEagle'sexpectations;thatproductionmeetsexpectations;thatAgnicoEagle'scurrentestimatesofmineralreserves,mineralresources,mineralgradesandmineralrecoveriesareaccurate;thattherearenomaterialdelaysinthetimingforcompletionofdevelopmentprojects;andthattherearenomaterialvariationsinthecurrenttaxandregulatoryenvironmentthataffectAgnicoEagle.

Theforward-lookingstatementsinthisAIFreflecttheCompany'sviewsasatthedateofthisAIFandinvolveknownandunknownrisks,uncertaintiesandotherfactorswhichcouldcausetheactualresults,performanceorachievementsoftheCompanyorindustryresultstobemateriallydifferentfromanyfutureresults,performanceorachievementsexpressedorimpliedbysuchforward-lookingstatements.Suchfactorsinclude,amongothers,theriskfactorssetoutin"RiskFactors"below.Giventheseuncertainties,readersarecautionednottoplaceunduerelianceontheseforward-lookingstatements,whichspeakonlyasofthedatemade.Exceptasotherwiserequiredbylaw,theCompanyexpresslydisclaimsanyobligationorundertakingtoreleasepubliclyanyupdatesorrevisionstoanysuchstatementstoreflectanychangeintheCompany'sexpectationsoranychangeinevents,conditionsorcircumstancesonwhichanysuchstatementisbased.ThisAIFcontainsinformationregardingestimatedtotalcashcostsperounce,all-insustainingcostsperounceandminesitecostspertonneinrespectoftheCompanyoratcertainoftheCompany'sminesandminedevelopmentprojects.TheCompanybelievesthatthesegenerallyacceptedindustrymeasuresarerealisticindicatorsofoperatingperformanceandareusefulinallowingyearoveryearcomparisons.Investorsarecautionedthatthisinformationmaynotbesuitableforotherpurposes.

Meaningof"including"and"suchas":WhenusedinthisAIF,theterms"including"and"suchas"meanincludingandsuchas,withoutlimitation.

iii

Presentation of Financial Information

InternationalFinancialReportingStandards:TheCompanyreportsitsfinancialresultsusingInternationalFinancialReportingStandards("IFRS").TheCompanyadoptedIFRSasitsbasisofaccounting,replacingUnitedStatesgenerallyacceptedaccountingprinciples("USGAAP")effectiveJuly1,2014.Asaresult,AgnicoEagle'sconsolidatedfinancialstatementsfor2015arereportedinaccordancewithIFRS,withcomparativeinformationforpriorperiodsrestatedunderIFRSandatransitiondateofJanuary1,2013.TheCompany'stransitiontoIFRSreportinghadnosignificantimpactonthedesignoreffectivenessoftheCompany'sinternalcontrolsoverfinancialreporting.TheCompanyadoptedIFRSasitsbasisofaccountingtomaintaincomparabilitywithothergoldminingcompanies.Unlessotherwisespecified,allreferencestofinancialresultshereinaretothosecalculatedunderIFRS.

Note to Investors Concerning Estimates of Mineral Reserves and Mineral Resources ThemineralreserveandmineralresourceestimatescontainedinthisAIFhavebeenpreparedinaccordancewiththeCanadiansecuritiesregulatoryauthorities'(the"CSA")NationalInstrument43-101Standards of Disclosure for Mineral Projects ("NI43-101").ThesestandardsaresimilartothoseusedbytheUnitedStatesSecuritiesandExchangeCommission's(the"SEC")IndustryGuideNo.7,asinterpretedbyStaffattheSEC("Guide7").However,thedefinitionsinNI43-101differincertainrespectsfromthoseunderGuide7.Accordingly,mineralreserveinformationcontainedorincorporatedbyreferencehereinmaynotbecomparabletosimilarinformationdisclosedbyU.S.companies.UndertherequirementsoftheSEC,mineralizationmaynotbeclassifiedasa"reserve"unlessthedeterminationhasbeenmadethatthemineralizationcouldbeeconomicallyandlegallyproducedorextractedatthetimethereservedeterminationismade.TheSECdoesnotrecognizemeasuresof"mineralresource".

Themineralreserveandmineralresourcedatapresentedhereinareestimates,andnoassurancecanbegiventhattheanticipatedtonnagesandgradeswillbeachievedorthattheindicatedlevelofrecoverywillberealized.TheCompanydoesnotincludeequivalentgoldouncesforby-productmetalscontainedinmineralreservesinitscalculationofcontainedounces.

Cautionary Note to Investors Concerning Estimates of Measured and Indicated Mineral Resources

Thisdocumentusestheterms"measuredmineralresources"and"indicatedmineralresources".InvestorsareadvisedthatwhilethosetermsarerecognizedandrequiredbyCanadianregulations,theSECdoesnotrecognizethem.Investors are cautioned not to assume that any part or allof mineral deposits in these categories will ever be converted into mineral reserves.


Thisdocumentusestheterm"inferredmineralresources".InvestorsareadvisedthatwhilethistermisrecognizedandrequiredbyCanadianregulations,theSECdoesnotrecognizeit."Inferredmineralresources"haveagreatamountofuncertaintyastotheirexistenceandastotheireconomicandlegalfeasibility.Itcannotbeassumedthatanypartorallofaninferredmineralresourcewilleverbeupgradedtoahighercategory.UnderCanadianregulations,estimatesofinferredmineralresourcesmaynotformthebasisoffeasibilityorpre-feasibilitystudies,exceptinrarecases.Investors are cautioned not to assume that any part or all of an inferred mineral resource exists, or is economically or legallymineable.

Note to Investors Concerning Certain Measures of Performance ThisAIFdisclosescertainmeasures,including"totalcashcostsperounce","all-insustainingcostsperounce"and"minesitecostspertonne"thatarenotrecognizedmeasuresunderIFRS.Thesedatamaynotbecomparabletodatareportedbyothergoldproducers.ForareconciliationofthesemeasurestothemostdirectlycomparablefinancialinformationpresentedintheconsolidatedfinancialstatementspreparedinaccordancewithIFRS,andforanexplanationofhowmanagementusesthesemeasures,pleaseseetheCompany'smanagementdiscussionandanalysisfortheperiodendedDecember31,2015(the"AnnualMD&A").

Thetotalcashcostsperounceofgoldproducedisreportedonbothaby-productbasis(deductingby-productmetalrevenuesfromproductioncosts)andco-productbasis(beforeby-productmetalrevenues).Thetotalcashcostsperounceofgoldproducedonaby-productbasisiscalculatedbyadjustingproductioncostsasrecordedintheconsolidatedstatementsofincome(loss)forby-productrevenues,unsoldconcentrateinventoryproductioncosts,smelting,refiningandmarketingchargesandotheradjustments,andthendividingbythenumberofouncesofgoldproduced.Thetotal

iv

cashcostsperounceofgoldproducedonaco-productbasisiscalculatedinthesamemannerasthetotalcashcostsperounceofgoldproducedonaby-productbasis,exceptthatnoadjustmentismadeforby-productmetalrevenues.Accordingly,thecalculationoftotalcashcostsperounceofgoldproducedonaco-productbasisdoesnotreflectareductioninproductioncostsorsmelting,refiningandmarketingchargesassociatedwiththeproductionandsaleofby-productmetals.Thetotalcashcostsperounceofgoldproducedisintendedtoprovideinformationaboutthecash-generatingcapabilitiesoftheCompany'sminingoperations.ManagementalsousesthesemeasurestomonitortheperformanceoftheCompany'sminingoperations.Asmarketpricesforgoldarequotedonaperouncebasis,usingthetotalcashcostsperounceofgoldproducedonaby-productbasismeasureallowsmanagementtoassessamine'scash-generatingcapabilitiesatvariousgoldprices.

All-insustainingcostsperounceisusedtoshowthefullcostofgoldproductionfromcurrentoperations.TheCompanycalculatesall-insustainingcostsperounceofgoldproducedonaby-productastheaggregateoftotalcashcostsperounceonaby-productbasis,sustainingcapitalexpenditures(includingcapitalizedexploration),generalandadministrativeexpenses(includingstockoptions)andreclamationexpensesdividedbytheamountofgoldproduced.Theall-insustainingcostsperounceofgoldproducedonaco-productbasisiscalculatedinthesamemannerastheall-insustainingcostsperounceofgoldproducedonaby-productbasis,exceptthatthetotalcashcostsperounceonaco-productbasisisused,meaningnoadjustmentismadeforby-productmetalrevenues.TheCompany'smethodologyforcalculatingall-insustainingcostsperouncemaydifferfromtothemethodologyusedbyotherproducersthatdiscloseall-insustainingcostsperounce.TheCompanymaychangethemethodologyitusestocalculateall-insustainingcostsperounceinthefuture,includinginresponsetotheadoptionofformalindustryguidanceregardingthismeasurebytheWorldGoldCouncil.

Managementisawarethattheseperouncemeasuresofperformancecanbeaffectedbyfluctuationsinexchangeratesand,inthecaseoftotalcashcostsperounceofgoldproducedonaby-productbasis,by-productmetalprices.ManagementcompensatesfortheseinherentlimitationsbyusingthesemeasuresinconjunctionwithminesitecostspertonneaswellasotherdatapreparedinaccordancewithIFRS.

Managementalsoperformssensitivityanalysesinordertoquantifytheeffectsoffluctuatingexchangeratesandmetalprices.ThisAIFalsocontainsinformationastoestimatedfuturetotalcashcostsperounce,all-insustainingcostsperounceandminesitecostspertonne.Theestimatesarebaseduponthetotalcashcostsperounce,all-insustainingcostsperounceandminesitecostspertonnethattheCompanyexpectstoincurtominegoldatitsminesandprojectsand,consistentwiththereconciliationoftheseactualcostsreferredtoabove,donotincludeproductioncostsattributabletoaccretionexpenseandotherassetretirementcosts,whichwillvaryovertimeaseachprojectisdevelopedandmined.Itisthereforenotpracticabletoreconciletheseforward-lookingnon-GAAPfinancialmeasurestothemostcomparableIFRSmeasure.

v

SELECTED FINANCIAL DATA Thefollowingselectedfinancialdataforeachoftheyearsinthefive-yearperiodendedDecember31,2015arederivedfromtheconsolidatedfinancialstatementsofAgnicoEagleauditedbyErnst&YoungLLP.TheselectedfinancialdatashouldbereadinconjunctionwiththeCompany'soperatingandfinancialreviewandprospectssetoutinAgnicoEagle'sannualauditedconsolidatedfinancialstatementsasofandfortheperiodendedDecember31,2015,includingthenotesthereto(the"AnnualFinancialStatements")andtheAnnualMD&A.

Year Ended December 31,

2015 (1) 2014 (1)(2) 2013 (1) 2012 (3) 2011 (3) (in thousands of U.S. dollars, other than share and per share information) Income Statement Data Revenuesfromminingoperations 1,985,432 1,896,766 1,638,406 1,917,714 1,821,799

Production 995,295 1,004,559 866,082 897,712 876,078

Explorationandcorporatedevelopment 110,353 56,002 44,236 109,500 75,721

Amortizationofproperty,plantandminedevelopment 608,609 433,628 313,890 271,861 261,781

Generalandadministrative 96,973 118,771 113,809 119,085 107,926

Impairmentlossonavailable-for-salesecurities 12,035 15,763 32,476 12,732 8,569

Loss(gain)onderivativefinancialinstruments 19,608 6,156 268 819 (3,683)

Provincialcapitaltax – – – 4,001 9,223

Financecosts 75,228 73,393 62,455 57,887 55,039

Otherexpenses(income) 12,028 (7,004) 3,396 2,389 5,188

Environmentalremediation 2,003 8,214 3,698 – –

LossonGoldexmine – – – – 302,893

Impairmentloss – – 1,014,688 – 907,681

Gainonsaleofavailable-for-salesecurities (24,600) (5,635) (74) (9,733) (4,907)

Foreigncurrencytranslation(gain)loss (4,728) 3,781 1,769 16,320 (1,082)

Income(loss)beforeincomeandminingtaxes 82,628 189,138 (818,287) 435,141 (778,628)

Incomeandminingtaxesexpense(recovery) 58,045 106,168 (131,582) 124,225 (209,673)

Netincome(loss)fortheyear 24,583 82,970 (686,705) 310,916 (568,955)

Attributedtonon-controllinginterest – – – – (60)

Attributedtocommonshareholders 24,583 82,970 (686,705) 310,916 (568,895)

Netincome(loss)pershare–basic 0.11 0.43 (3.97) 1.82 (3.36)

Netincome(loss)pershare–diluted 0.11 0.39 (3.97) 1.81 (3.36)

Weightedaveragenumberofcommonsharesoutstanding–basic 216,167,950 195,222,905 172,892,654 171,250,179 169,352,896

Weightedaveragenumberofcommonsharesoutstanding–diluted 217,101,431 196,201,626 172,892,654 171,485,615 169,352,896

Cashdividendsdeclaredpercommonshare 0.32 0.32 0.66 1.02 –

Balance Sheet Data (at end of period) Property,plantandminedevelopment 5,088,967 5,155,865 3,694,461 4,067,456 3,895,355

Totalassets 6,683,180 6,809,255 4,580,081 5,256,119 5,034,262

Long-termdebt 1,118,187 1,322,461 987,356 830,000 920,095

Reclamationprovision 276,299 249,917 184,009 101,753 105,443

Netassets 4,141,020 4,068,490 2,717,406 3,410,212 3,215,163

Commonshares 4,707,940 4,599,788 3,294,007 3,241,922 3,181,381

Shareholders'equity 4,140,020 4,068,490 2,717,406 3,410,212 3,215,163

Totalcommonsharesoutstanding 217,650,795 214,236,234 173,953,975 172,102,870 170,813,736

(1) Figuresreportedfor2015,2014and2013arepresentedinaccordancewithIFRS.

(2) Assetoutinnote5oftheAnnualFinancialStatements,certainpreviouslyreportedDecember31,2014consolidatedbalancesheetlineitemshavebeenupdatedtoreflectadjustedfinalestimatesoffairvaluerelatedtotheJune16,2014jointacquisitionofOsiskoMiningCorporation("Osisko")bytheCompanyandYamanaGoldInc.("Yamana").

(3) Figuresreportedfor2012and2011havenotbeenrestatedtoconformtoIFRSandarepresentedinaccordancewithUSGAAP.

AGNICO EAGLE 1 ANNUAL INFORMATION FORM

GLOSSARY OF SELECTED MINING TERMS

"alteration" Anyphysicalorchemicalchangeinthemineralcompositionofarocksubsequenttoitsformation,generallyproducedbyweatheringorhydrothermalsolutions.Milderandmorelocalizedthanmetamorphism.

"anastomosing" Anetworkofbranchingandrejoiningfaultorveinsurfacesorsurfacetraces.

"andesite" Adark-coloured,fine-grainedcalc-alkalinevolcanicrockofintermediatecomposition.

"assay" Toanalyzetheproportionsofmetalsinanore;totestanoreormineralforcomposition,purity,weightorotherpropertiesofcommercialinterest.

"banded iron formation" Anironformationthatshowsmarkedbanding,generallyofiron-richmineralsandchertorfine-grainedquartz.

"bedrock" SolidrockexposedatthesurfaceoftheEarthoroverlainbyunconsolidatedmaterial,weatheredrockorsoil.

"bench" Aledgeinanopenpitminethatformsasinglelevelofoperationabovewhichmineralsorwasterockareexcavated.Theoreorwasteisremovedinsuccessivelayers(benches),severalofwhichmaybeinoperationsimultaneously.

"breccia" Arockinwhichangularrockfragmentsaresurroundedbyamassoffine-grainedminerals.

"brittle" Ofminerals,pronenesstofractureunderlowstress.Aqualityaffectingbehaviourduringcomminutionofore,wherebyonespeciesfracturesmorereadilythanothersinthematerialbeingcrushed.

"bulk emulsion" Waterresistantexplosivematerialpumpedintoadrilledblastholeandignitedremotelyinordertofracturerockintheminingcycle.Emulsionproductsareparticularlywellsuitedtowetconditions.

"by-product" Asecondarymetalormineralproductrecoveredfromtheprocessingofrock.

"carbon-in-leach (CIL)" Apreciousmetalsrecoverystepinthemill.Goldandsilverareleachedfromthegroundoreandatthesametimeadsorbedontogranulesofactivatedcarbon,whichisthenseparatedbyscreeningandprocessedtoremovethepreciousmetals.

"carbon-in-pulp (CIP)" Apreciousmetalsrecoverystepinthemill.Aftergoldandsilverhavebeenleachedfromgroundore,theyareadsorbedontogranulesofactivatedcarbon,whichisthenseparatedbyscreeningandprocessedtoremovethepreciousmetals.ACIPcircuitcomprisesaseriesoftanksthroughwhichleachedslurryflows.Goldiscapturedontocaptiveactivatedcarbonthatwillperiodicallybemovedcounter-currentlyfromtanktotank.Headtankcarbonisextractedperiodicallytofurtherrecoveradsorbedgoldbeforebeingreturnedtothecircuittailstank.

"chalcopyrite" Asulphidemineralofcopperandiron.

"concentrate" Thecleanproductrecoveredbyfrothflotationintheplant.

"conglomerate" Acoarse-grainedsedimentaryrockcomposedofroundedfragmentssetinafine-grainedcementedmatrix.

"contact" Aplaneorirregularsurfacebetweentwotypesoragesofrock.

"counter-current decantation" Theclarificationofwasherywaterandtheconcentrationoftailingsbytheuseofseveralthickenersinseries.Thewaterflowsintheoppositedirectionfromthesolids.Thefinalproductsareslurrythatisremovedandclearwaterthatisreusedinthecircuit.

2 AGNICO EAGLE ANNUAL INFORMATION FORM

"crosscut" Anundergroundpassagedrivenfromashafttowardstheore,at(ornear)rightanglestothestrikeofaveinorotherorebody.

"cut-off grade" Theminimummetalgradeinanorethatcanbeminedeconomically.

"cyanidation" Amethodofextractingexposedgoldorsilvergrainsfromcrushedorgroundorebydissolving(leaching)itinaweakcyanidesolution.Maybecarriedoutintanksinsideamillorinheapsoforeoutofdoors(heapleach).

"deposit" Anaturaloccurrenceofmineralormineralaggregate,insuchquantityandqualitytoinviteexploitation.

"development" Thepreparationofaminingpropertyorareasothatanorebodycanbeanalyzedanditstonnageandqualityestimated.Developmentisanintermediatestagebetweenexplorationandmining.

"diamond drill" Adrillingmachinewitharotating,hollow,diamond-studdedbitthatcutsacircularchannelaroundacore,whichcanberecoveredtoprovideamore-or-lesscontinuousandcompletecolumnarsampleoftherockpenetrated.

"dilution" Thecontaminationoforewithbarrenwallrockinstoping,increasingtonnageminedandloweringtheoveralloregrade.

"dip" Theangleatwhichavein,structureorrockbedisinclinedfromthehorizontalasmeasuredatrightanglestothestrike.

"disseminated" Saidofamineraldeposit(especiallyofmetals)inwhichthedesiredmineralsoccurasscatteredparticlesintherock,butinsufficientquantitytomakethedepositanore.Somedisseminateddepositsareverylarge.

"dore" Unrefinedgoldandsilverbullionbars,whichwillbefurtherrefinedtoalmostpuremetal.

"drift" Ahorizontalopeninginornearanorebodyandparalleltothelongdimensionoftheorebody,asopposedtoacrosscutthatcrossestheorebody.

"ductile" Ofrock,abletosustain,underagivensetofconditions,5%to10%deformationbeforefracturingorfaulting.

"dyke" Anearthenembankment,asaroundadrillsumportank,ortoimpoundabodyofwaterormilltailings.Also,atabularbodyofigneousrockthatcutsacrossthestructureofadjacentrocks.

"electrowinning" Anelectrochemicalprocessinwhichametaldissolvedwithinanelectrolyteisplatedontoanelectrode.Usedtorecovermetalssuchascopperandgoldfromsolutionintheleachingofconcentrates.

"envelope" 1.Theouterorcoveringpartofafold,especiallyofafoldedstructurethatincludessomesortofstructuralbreak.

2.Ametamorphicrocksurroundinganigneousintrusion.

3.Inamineral,anouterpartdifferentinoriginfromaninnerpart.

"epigenetic" Orebodiesformedbyhydrothermalfluidsandgasesthatwereintroducedintothehostrocksfromelsewhere,fillingcavitiesinthehostrock.

"epithermal" Referringtoamineraldepositthatformedlaterthantheenclosingrocksconsistingofveinsandreplacementbodies,containingpreciousmetalsor,morerarely,basemetals.

"extensional-shear vein" Aveinputinplaceinanextensionfracturecausedbythedeformationofarock.

"fault" Afractureorafracturezoneincrustalrocksalongwhichtherehasbeendisplacementofthetwosidesrelativetooneanotherparalleltothefracture.Thedisplacementmaybeafewinchesormanykilometreslong.


"feasibility study" Acomprehensivetechnicalandeconomicstudyoftheselecteddevelopmentoptionforamineralprojectthatincludesappropriatelydetailedassessmentsofrealisticallyassumedmining,processing,metallurgical,economic,marketing,legal,environmental,socialandgovernmentalconsiderations,togetherwithanyotherrelevantoperationalfactorsandadetailedfinancialanalysis,thatarenecessarytodemonstrateatthetimeofreportingthatextractionisreasonablyjustified(economicallymineable).Theresultsofthestudymayreasonablyserveasthebasisforafinaldecisionbyaproponentorfinancialinstitutiontoproceedwith,orfinance,thedevelopmentoftheproject.Theconfidencelevelofthestudywillbehigherthanthatofapre-feasibilitystudy.

"felsic" Atermusedtodescribelight-colouredrockscontainingfeldspar,feldspathoidsandsilica.

"flotation" Themethodofmineralseparationinwhichafrothcreatedbyavarietyofreagentsfloatssomefinelycrushedminerals,whereasothermineralssink.Themetal-richflotationconcentrateisthenskimmedoffthesurface.

"flowsheet" Adiagramshowingtheprogressofmaterialthroughatreatmentplant.

"foliation" Ageneraltermforaplanararrangementoffeaturesinanytypeofrock,especiallytheplanarstructurethatresultsinametamorphicrock.

"footwall" Therockbeneathaninclinedveinororedeposit(oppositeofahangingwall).

"fracture" Anybreakinarock,whetherornotitcausesdisplacement,duetomechanicalfailurebystress;includescracks,jointsandfaults.

"free gold" Goldnotcombinedwithothersubstances.

"glacial till" Dominantlyunsortedandunstratified,unconsolidatedrockdebris,depositeddirectlybyandunderneathaglacier.

"grade" Therelativequantityorthepercentageofmetalcontentofanorebody,e.g. ,gramsofgoldpertonneofrock,orpercentcopper.

"greenstone belt" Anareaunderlainbymetamorphosedvolcanicandsedimentaryrocks,usuallyinacontinentalshield.

"grouting" Theprocessofsealingoffawaterflowinrocksbyforcingathinslurryofcementorotherchemicalsintothecrevices;usuallydonethroughadiamonddrillhole.

"hanging wall" Therockontheuppersideofaveinororedeposit.

"head grade" Theaveragegradeoforefedintoamill.

"hectare" Ametricmeasurementofarea.1hectare=10,000squaremetres=2.47acres.

"horst" Anup-faultedblockofrock.

"hydrothermal alteration" Alterationofrocksormineralsbyreactionwithhydrothermal(magmatic)fluids.

"igneous rock" RockformedbythesolidificationofmoltenmaterialthatoriginatedwithintheEarth.

"indicated mineral resource" Thatpartofamineralresourceforwhichquantity,gradeorquality,densities,shapeandphysicalcharacteristicscanbeestimatedwithalevelofconfidencesufficienttoallowtheappropriateapplicationoftechnicalandeconomicparameterstosupportmineplanningandevaluationoftheeconomicviabilityofthedeposit.Theestimateisbasedondetailedandreliableexplorationandtestinginformationgatheredthroughappropriatetechniquesfromlocationssuchasoutcrops,trenches,pits,workingsanddrillholesthatarespacedcloselyenoughforgeologicalandgradecontinuitytobereasonablyassumed.

WhilethistermisrecognizedandrequiredbyCanadianregulations,theSECdoesnotrecognizeit.Investorsarecautionednottoassumethatanypartorallofthemineraldepositsinthiscategorywilleverbeconvertedintomineralreserves.


"inferred mineral resource" Thatpartofamineralresourceforwhichquantityandgradeorqualitycanbeestimatedonthebasisofgeologicalevidenceandlimitedsamplingandreasonablyassumed,butnotverified,geologicalandgradecontinuity.Theestimateisbasedonlimitedinformationandsamplinggatheredthroughappropriatetechniquesfromlocationssuchasoutcrops,trenches,pits,workingsanddrillholes.

WhilethistermisrecognizedandrequiredbyCanadianregulations,theSECdoesnotrecognizeit.Investorsarecautionednottoassumethatanypartorallofthemineraldepositsinthiscategorywilleverbeconvertedintomineralreserves.Investorsarecautionednottoassumethatpartoforallofaninferredmineralresourceexists,oriseconomicallyorlegallymineable.

"infill drilling" Drillingwithinadefinedmineralizedareatoimprovethedefinitionofknownmineralization.

"intrusive" Abodyofigneousrockformedbytheconsolidationofmagmaintrudedbelowsurfaceintootherrocks,incontrasttolavas,whichareextrudedupontheEarth'ssurface.

"iron formation" Achemicalsedimentaryrock,typicallythin-beddedorfinelylaminated,containingatleast15%ironofsedimentaryoriginandcommonlycontaininglayersofchert.

"ITH drill" Atypeofrockdrillinwhichahammerismountedinthehole,applyingpercussiveforcedirectlytothedrillbit.

"kilometre" Ametricmeasurementofdistance.1.0kilometre=1,000metres=0.62miles.

"leaching" Achemicalprocessfortheextractionofvaluablemineralsfromore;also,anaturalprocessbywhichgroundwatersdissolveminerals.

"lens" Ageologicaldepositthatisthickinthemiddleandtaperstowardstheends,resemblingaconvexlens.

"lithologic groups" Groupsofrockformations.

"lode" Amineraldepositconsistingofazoneofveins,veinletsordisseminations.

"longitudinal retreat" Anundergroundminingmethodwheretheoreisexcavatedinhorizontalslicesalongtheorebodyandthestopingstartsbelowandadvancesupwards.Theoreisrecoveredunderneathinthestope.

"mafic" Igneousrockscomposedmostlyofdark,iron-andmagnesium-richsilicateminerals.

"massive" Saidofamineraldeposit,especiallyofsulphides,characterizedbyagreatconcentrationoforeinoneplace,asopposedtoadisseminatedorvein-likedeposit.Saidofanyrockthathasahomogeneoustextureorfabricoveralargearea,withanabsenceoflayeringoranysimilardirectionalstructure.

"matrix" Thefine-grainedrockmaterialinwhichalargermineralisembedded.

"measured mineral resource" Thatpartofamineralresourceforwhichquantity,gradeorquality,densities,shapeandphysicalcharacteristicsaresowellestablishedthattheycanbeestimatedwithconfidencesufficienttoallowtheappropriateapplicationoftechnicalandeconomicparameterstosupportproductionplanningandevaluationoftheeconomicviabilityofthedeposit.Theestimateisbasedondetailedandreliableexploration,samplingandtestinginformationgatheredthroughappropriatetechniquesfromlocationssuchasoutcrops,trenches,pits,workingsanddrillholesthatarespacedcloselyenoughtoconfirmbothgeologicalandgradecontinuity.

WhilethistermisrecognizedandrequiredbyCanadianregulations,theSECdoesnotrecognizeit.Investorsarecautionednottoassumethatanypartorallofthemineraldepositsinthiscategorywilleverbeconvertedintomineralreserves.


"Merrill-Crowe process" Aseparationtechniqueforremovinggoldfromacyanidesolution.Thesolutionisseparatedfromtheorebymethodssuchasfiltrationandcounter-currentdecantation,andthenthegoldisprecipitatedontozincdust.Silverandcoppermayalsoprecipitate.Theprecipitateisfilteredtocapturethegoldslimes,whicharefurtherrefined,e.g. ,bysmelting,toremovethezincandbytreatingwithnitricacidtodissolvethesilver.

"metamorphism" Theprocessbywhichtheformorstructureofsedimentaryorigneousrocksischangedbyheatandpressure.

"mill" Amineraltreatmentplantinwhichcrushing,wetgrindingandfurthertreatmentoforeisconducted;alsoarevolvingdrumusedforthegrindingoforesinpreparationfortreatment.

"mineral resource" Aconcentrationoroccurrenceofdiamonds,naturalsolidinorganicmaterialornaturalsolidfossilizedorganicmaterialincludingbaseandpreciousmetals,coalandindustrialmineralsinorontheEarth'scrustinsuchformandquantityandofsuchagradeorqualitythatithasreasonableprospectsforeconomicextraction.Thelocation,quantity,grade,geologicalcharacteristicsandcontinuityofamineralresourceareknown,estimatedorinterpretedfromspecificgeologicalevidenceandknowledge.Investorsarecautionednottoassumethatanypartorallofthemineraldepositsinanycategoryofresourceswilleverbeconvertedintomineralreserves.

"mineral reserve" Theeconomicallymineablepartofameasuredorindicatedmineralresourcedemonstratedbyatleastapreliminaryfeasibilitystudy.Thisstudymustincludeadequateinformationonmining,processing,metallurgical,economicandotherrelevantfactorsthatdemonstrate,atthetimeofreporting,thateconomicextractioncanbejustified.Amineralreserveincludesdilutingmaterialsandallowancesforlossesthatmayoccurwhenthematerialismined.

"muck" Finelyblastedrock(oreorwaste)underground.

"net smelter return royalty" Aroyaltypaymentmadebyaproducerofmetalsbasedontheproceedsfromthesaleofmineralproductsafterdeductingoff-siteprocessinganddistributioncostsincludingsmelting,refining,transportationandinsurancecosts.

"ounce" Ameasurementofweight,especiallyusedforgold,silverandplatinumgroupmetals.1troyounce=31.1035grams.

"outcrop" ThepartofarockformationthatappearsatthesurfaceoftheEarth.

"oxidation" Achemicalreactioncausedbyexposuretooxygen,whichresultsinachangeinthechemicalcompositionofamineral.

"pillar" Ablockoforeorotherrockentirelysurroundedbystoping,leftintentionallyforpurposesofgroundcontroloronaccountoflowvalue.

"plunge" Theinclinationofafoldaxisorotherlinearstructurefromahorizontalplane,measuredintheverticalplane.

"polydeformed" Arockthathasbeensubjectedtomorethanoneinstanceoffolding,faulting,shearing,compressionorextensionasaresultofvarioustectonicforces.

"porphyritic" Rocktextureinwhichoneormoremineralshasalargergrainsizethantheaccompanyingminerals.

"porphyry" Anyigneousrockinwhichrelativelylargecrystalsaresetinafine-grainedgroundmass.


"preliminary feasibility study"or "pre-feasibility study"

Acomprehensivestudyofarangeofoptionsforthetechnicalandeconomicviabilityofamineralprojectthathasadvancedtoastagewhereapreferredminingmethod(inthecaseofundergroundmining)orthepitconfiguration(inthecaseofanopenpit)isestablished,andaneffectivemethodofmineralprocessingisdetermined.Itincludesafinancialanalysisbasedonreasonableassumptionsonmining,processing,metallurgical,economic,marketing,legal,environmental,socialandgovernmentalconsiderationsandtheevaluationofanyotherrelevantfactorswhicharesufficientforaqualifiedperson,actingreasonably,todetermineifallorpartofthemineralresourcemaybeclassifiedasamineralreserve.

"pressure oxidation" Aprocessbywhichsulphidemineralsareoxidizedinordertoexposegoldthatisencapsulatedintheminerallattice.Themaincomponentofapressureoxidationcircuitconsistsofapressurizedvessel(autoclave)wheretheoxygenlevel,processtemperatureandacidityaretheprimarycontrolparameters.

"probable mineral reserve" Theeconomicallymineablepartofanindicatedand,insomecircumstances,ameasuredmineralresourcedemonstratedbyatleastapreliminaryfeasibilitystudy.

"proven mineral reserve" Theeconomicallymineablepartofameasuredmineralresourcedemonstratedbyatleastapreliminaryfeasibilitystudy.

"pyrite" Ayellowironsulphidemineral,FeS2,normallyoflittlevalue.Itissometimesreferredtoas"fool'sgold".

"pyroclastic" Rocksproducedbyexplosiveoraerialejectionofash,fragmentsandglassymaterialfromavolcanicvent.

"recovery" Thepercentageofvaluablemetalintheorethatisrecoveredbymetallurgicaltreatment.

"rock burst" Asuddenandoftenviolentbreakingofamassofrockfromthewallsofamine,causedbyfailureofhighlystressedrockandtherapidreleaseofaccumulatedstrainenergy.

"run-of-mine ore" Theraw,minedmaterialasitisdelivered,priortosorting,stockpilingortreatment.

"sandstone" Asedimentaryrockconsistingofgrainsofsandcementedtogether.

"schist" Astronglyfoliatedcrystallinerockthatcanbereadilysplitintothinflakesorslabsduetothewell-developedparallelismofmorethan50%ofthemineralspresentinit,suchasmicaorhornblende.

"sedimentary rocks" Rocksresultingfromtheconsolidationofloosesedimentthathasaccumulatedinlayers.Examplesarelimestone,shaleandsandstone.

"semi-autogenous grinding(SAG)"

Amethodofgrindingrockwherebylargerchunksoftherockitselfandsteelballsformthegrindingmedia.

"shear" or "shearing" Thedeformationofrocksbylateralmovementalonginnumerableparallelplanes,generallyresultingfrompressureandproducingmetamorphicstructuressuchascleavageandschistosity.

"shear zone" Atabularzoneofrockthathasbeencrushedandbrecciatedbymanyparallelfracturesduetoshearstress.Suchanareaisoftenmineralizedbyore-formingsolutions.

"sill" Anintrusivesheetofigneousrockofroughlyuniformthicknessthathasbeenforcedbetweenthebeddingplanesofexistingrock.

"slurry" Finerockparticlesincirculatingwaterinatreatmentplant.

"stope" 1.Anyexcavationinamine,otherthandevelopmentworkings,madeforthepurposeofextractingore.

2.Toexcavateoreinanundergroundmine.


"strike" Thedirection,orbearingfromtruenorth,ofahorizontallineonaveinorrockformationatrightanglestothedip.

"stringers" Mineralveinletsorfilamentsoccurringinadiscontinuoussubparallelpatterninahostrock.

"sulphide" Amineralcharacterizedbythelinkageofsulphurwithametal,suchaspyrite,FeS2.

"tabular" Saidofafeaturehavingtwodimensionsthataremuchlargerorlongerthanthethird,suchasadyke.

"tailings" Materialrejectedfromamillaftertheeconomicallyandtechnicallyrecoverablevaluablemineralshavebeenextracted.

"tailings dam" or "tailingsimpoundment" or "tailingspond"

Areaclosedatthelowerendbyaconstrainingwallordamtowhichmilleffluentsaresent,theprimefunctionofwhichistoallowenoughtimeformetalstosettleoutorforcyanidetobenaturallydestroyedbeforethewaterisreturnedtothemillordischargedintothelocalwatershed.

"tenement" Therighttoenter,developandworkamineraldeposit.Includesaminingclaimoramininglease.Asynonymofmineraltitle.

"thickener" Avesselforreducingtheproportionofwaterinapulpbymeansofsedimentation.

"thickness" Thedistanceatrightanglesbetweenthehangingwallandthefootwallofalodeorlens.

"tonne" Ametricmeasurementofmass.1tonne=1,000kilograms=2,204.6pounds=1.1tons.

"transfer fault" Astructurethatcanaccommodatelateralvariationsofdeformationandstrain.

"transverse open stoping" Anundergroundminingmethodinwhichtheoreisexcavatedinhorizontalslicesperpendiculartotheorebodylengthandthestopingstartsbelowandadvancesupwards.Theoreisrecoveredunderneaththestopethroughadrawpointsystem.

"trench" Anarrowexcavationdugthroughoverburden,orblastedoutofrock,toexposeaveinororestructureforsamplingorobservation.

"vein" Amineralfillingofafaultorotherfractureinahostrock.

"wacke" A"dirty"sandstonethatconsistsofamixtureofpoorlysortedmineralandrockfragmentsinanabundantmatrixofclayandfinesilt.

"winze" Aninternalmineshaft.

"Zadra elution circuit" Theprocessinthispartofagoldmillstripsgoldandsilverfromcarbongranulesandputsthemintosolution.

"zone" Anareaofdistinctmineralization,i.e. ,adeposit.


CORPORATE STRUCTURE AgnicoEagleMinesLimitedisacorporationorganizedundertheBusiness Corporations Act (Ontario).TheCompanywasformedbyarticlesofamalgamationunderthelawsoftheProvinceofOntarioonJune1,1972,asaresultoftheamalgamationofAgnicoMinesLimited("AgnicoMines")andEagleGoldMinesLimited("Eagle").AgnicoMineswasincorporatedunderthelawsoftheProvinceofOntarioonJanuary21,1953underthename"CobaltConsolidatedMiningCorporationLimited".EaglewasincorporatedunderthelawsoftheProvinceofOntarioonAugust14,1945.

Since1972,severalcorporatealterationshavetakenplace.OnAugust22,1972,theCompany'sarticleswereamendedtopermittheCompanyto:(i)borrowmoneyonthecreditoftheCompany,(ii)issue,sellorpledgedebtobligationsand(iii)charge,mortgageorpledgetheCompany'sproperty.OnJune27,1980,ArticlesofAmendmentwerefiledtoallowtheCompanytousethename"MinesAgnico-EagleLimitée".OnJuly5,1984,theCompany'sarticleswereamendedtodeletealloftheobjectsoftheCompanylistedandspecifythatnorestrictionsapplytothebusinessorpowersthattheCompanymayexercise.OnJuly3,1986,ArticlesofAmendmentwerefiledtosettheminimumnumberofdirectorsoftheCompanyatfiveandthemaximumatnine.OnJuly29,1988,theCompany'sarticleswereamendedtoprovidethattheCompanyisauthorizedtoissueanunlimitednumberofshares.

OnDecember31,1992,theCompanyamalgamatedwithLuckyEagleMinesLimited.OnJune30,1993,themaximumnumberofdirectorsoftheCompanywasincreasedfromnineto12.OnJanuary1,1996,theCompanyamalgamatedwithGoldexMinesLimitedand1159885OntarioLimited.OnOctober17,2001,theCompanyfiledArticlesofArrangementwhichprovidedfortheamalgamationoftheCompanyandMentorExplorationandDevelopmentCo.OnJuly12,2002,thenameoftheCompanywaschangedto"Agnico-EagleMinesLimited/MinesAgnico-EagleLimitee".OnAugust1,2007,theCompanyamalgamatedwithCumberlandResourcesLtd.,Agnico-EagleAcquisitionCorporationandMeadowbankMiningCorporation.OnMay4,2010,themaximumnumberofdirectorsoftheCompanywasincreasedfrom12to15.

OnJanuary1,2011,theCompanyamalgamatedwith1816276OntarioInc.(theultimatesuccessorentitytoComaplexMineralsCorp.).OnJanuary1,2013,theCompanyamalgamatedwith1886120OntarioInc.(thesuccessorcorporationto9237-4925QuébecInc.).OnApril26,2013,ArticlesofAmendmentwerefiledtoeliminatethehyphenbetween"Agnico"and"Eagle"andtheofficialnameoftheCompanybecame"AgnicoEagleMinesLimited/MinesAgnicoEagleLimitée".

TheCompany'sheadandregisteredofficeislocatedatSuite400,145KingStreetEast,Toronto,Ontario,CanadaM5C2Y7;telephonenumber(416)947-1212;website:www.agnicoeagle.com .TheinformationcontainedontheCompany'swebsiteisnotpartofthisAIF.TheCompany'sprincipalplaceofbusinessintheUnitedStatesislocatedat1675E.PraterWay,Suite102,Sparks,Nevada89434.


ThefollowingchartsetsoutthecorporatestructureoftheCompany,eachofitssignificantsubsidiariesandcertainotherentities,togetherwiththejurisdictionoforganizationoftheCompanyandeachsuchsubsidiaryorentityasatMarch15,2016(allofwhicharedirectlyorindirectlywholly-ownedbytheCompany,unlessotherwiseindicated).


DESCRIPTION OF THE BUSINESS TheCompanyisanestablishedCanadian-basedinternationalgoldproducerwithminingoperationsinnorthwesternQuebec,northernMexico,northernFinlandandNunavutandexplorationactivitiesinCanada,Europe,LatinAmericaandtheUnitedStates.TheCompany'soperatinghistoryincludesoverthreedecadesofcontinuousgoldproduction,primarilyfromundergroundoperations.SinceitsformationonJune1,1972,theCompanyhasproducedapproximately12.7millionouncesofgold.

TheCompany'sstrategyistodeliverhighqualitygrowthwhilemaintaininghighperformancestandardsinhealth,safety,environmentalmattersandsocialacceptability;buildastrongpipelineofprojectstodrivefutureproduction;andemploythebestpeopleandmotivatethemtoreachtheirpotential.TheCompanyhasspentapproximately$3.6billiononminedevelopmentoverthelastsevenyears.Throughthisdevelopmentprogram,theCompanytransformeditselffromaregionallyfocused,singlemineproducertoamulti-mineinternationalgoldproducerwithsevenoperating,100%ownedmines,oneoperating50%ownedmine,andoneadvancedexploration/developmentproject.

Thefollowingtablesetsoutthedateofacquisition,thedateofcommencementofconstruction,thedateofachievingcommercialproductionandtheestimatedminelifefortheCompany'smines.

Date of Acquisition (1)Date of Commencement

of ConstructionDate of achieving

Commercial ProductionEstimated

Mine Life (2)

LaRonde mine 1992 1985 1988 2024

Lapa mine June2003 June2006 May2009 2016

Goldex mine (3) December1993 July2012 October2013 2024

Canadian Malartic mine June2014 n/a May2011 2026

Kittila mine November2005 June2006 May2009 2035

Meadowbank mine April2007 Pre-April2007 March2010 2018

Pinos Altos mine March2006 August2007 November2009 2024

La India mine November2011 September2012 February2014 2020

Notes:

(1) Datewhen100%ownershipwasacquired,otherthantheCanadianMalarticminewhichisthedatewhen50%ownershipwasacquired.

(2) EstimatedenddateforgoldproductionbasedontheCompany'scurrentlifeofmineplans.

(3) ConstructionofinfrastructureforpurposesofminingtheGoldexExtensionZone(the"GEZ")commencedinJuly2005andtheGEZachievedcommercialproductioninAugust2008.MiningoperationsontheGEZhavebeensuspendedsinceOctober2011.Inlate2013,miningandproductionbeganfromtheMandEZonesoftheGoldexmine.

Since1988,theLaRondemine,intheAbitibiregionofQuebec,hasbeentheCompany'sflagshipoperation,producingapproximately5.2millionouncesofgoldaswellasvaluableby-products.TheLapamine,oneoftheCompany'shighestgrademetalsmines,is11kilometreseastoftheLaRondemine,andtheGoldexmine,whichachievedcommercialproductionfromtheMandEZonesinOctober2013,is60kilometreseastoftheLaRondemine.ThesynergiesbetweenthesesitescontributetotheCompany'seffortstoreducecosts.TheCompany's50%ownedCanadianMalarticmine,alsointheAbitibiregionofQuebec,wasacquiredinJune,2014.TheKittilamineinFinland,whichachievedcommercialproductioninMay2009,hasalongreservelifeandhassignificantproductionexpansionpotential.TheCompany'sMeadowbankmine,inNunavut,achievedcommercialproductioninMarch2010andisexpectedtoproducethemostgold(approximately305,000ounces)ofanyoftheCompany'sminesin2016.ThePinosAltosmine,inMexico,achievedcommercialproductioninNovember2009andalsohassignificantproductionexpansionpotentialandtheLaIndiamine,alsoinMexico,achievedcommercialproductioninFebruary2014.Inaddition,theCompanyplanstopursueopportunitiesforgrowthingoldproductionandgoldreservesthroughtheprudentacquisitionordevelopmentofexplorationproperties,developmentproperties,producingpropertiesandotherminingbusinessesintheAmericasandEurope.

In2015,theCompanyproduced1,671,340ouncesofgoldattotalcashcostsperounceof$567onaby-productbasisandatall-insustainingcostsperounceof$810onaby-productbasis.For2016,theCompanyexpectstoproducebetween1.525and1.565millionouncesofgoldattotalcashcostsperounceofgoldonaby-productbasisbetween$590and$630andatall-insustainingcostsperouncebetween$850and$890onaby-productbasis.See"Introductory


Notes–NotetoInvestorsConcerningCertainMeasuresofPerformance"foradiscussionoftheuseofthenon-GAAPmeasurestotalcashcostsperounceandall-insustainingcostsperounce.TheCompanyhastraditionallysoldallofitsproductionatthespotpriceofgoldduetoitsgeneralpolicynottosellforwarditsfuturegoldproduction.

GENERAL DEVELOPMENT OF THE BUSINESS Three-Year History

2013

OnMay16,2013,theCompanycompleteditsacquisitionofalloftheissuedandoutstandingcommonsharesofUrastarGoldCorp.("Urastar"),aCanadian-basedgoldexplorationcompanythatwas,atthetime,listedontheTSXVentureExchange(the"TSX-V"),pursuanttoacourt-approvedplanofarrangementundertheBusiness Corporations Act (BritishColumbia).Urastarhelda100%interestincertainminingpropertiesinSonora,Mexico.Underthetermsofthearrangement,eachshareholderofUrastarreceivedC$0.25percommonshareandholdersofunexercisedin-the-moneywarrantsofUrastarreceivedC$0.15perwarrant,foraggregatecashconsiderationof$10.1million.Urastarisnowawholly-ownedsubsidiaryofAgnicoEagle.

InSeptember2013,pre-productioncommissioningactivitiescommencedattheLaIndiamine.

AsofOctober1,2013,commercialproductionwasachievedattheGoldexmine'sMandEZones.

CapitalexpendituresbytheCompanyin2013were$620.5million.Thisincluded$84.3millionattheLaRondemine,$22.7millionattheLapamine,$65.1millionattheGoldexmine,$83.8millionattheKittilamine,$109.3millionattheMeadowbankmine,$70.7millionatthePinosAltosmine(whichincludedapproximately$17.8millionattheCrestonMascotadepositatPinosAltos),$116.8millionattheLaIndiaproject,$61.4millionattheMeliadineprojectand$6.5millionatotherproperties.Inaddition,theCompanyincurred$4.9millionofexpendituresonminesiteexplorationand$39.3milliononexplorationactivitiesattheCompany'sexplorationpropertiesandoncorporatedevelopmentactivities.

2014

AsofFebruary1,2014,commercialproductionwasachievedattheLaIndiamine.

OnJune16,2014,theCompanyandYamanajointlyacquired100%oftheoutstandingsharesofOsiskopursuanttoacourt-approvedplanofarrangementundertheCanada Business Corporations Act (the"OsiskoArrangement")forconsiderationofapproximatelyC$3.9billionconsistingofapproximatelyC$1.0billionincashandacombinationofcommonsharesoftheCompany,commonsharesofYamanaandsharesofanewcompanythatwasspun-offundertheOsiskoArrangement.OsiskowasaCanadianbasedproducinggoldminingcompanythatwas,atthetime,listedontheTorontoStockExchange(the"TSX").Osiskowas100%owneroftheCanadianMalarticmineintheAbitibiregionofQuebec.UndertheOsiskoArrangement,eachOsiskosharewasexchangedfor:(i)C$2.09incash(C$1.045persharefromeachoftheCompanyandYamana);(ii)0.07264ofacommonshareoftheCompany;(iii)0.26471ofacommonshareofYamana;and(iv)0.1ofonecommonshareofOsiskoGoldRoyaltiesLtd("NewOsisko"),thenewlyformedspun-offcompanythatcommencedtradingontheTSXimmediatelyfollowingtheOsiskoArrangement.

InconnectionwiththeOsiskoArrangement,substantiallyalloftheassetsandobligationsrelatingtotheCanadianMalarticmineinQuebecweretransferredtoCanadianMalarticGP(the"Partnership"),anewlyformedgeneralpartnershipinwhichtheCompanyandYamanaeachownanindirect50%interest.TheCompanyandYamanaformedajointmanagementcommitteetooperatetheCanadianMalarticmine.OnJune17,2014,OsiskoandtheacquisitioncorporationformedbytheCompanyandYamanatoacquireOsiskoamalgamatedtoform"CanadianMalarticCorporation"inwhichAgnicoandYamanaeachholdanindirect50%interest.CanadianMalarticCorporationcontinuestohold,amongotherthings,Osisko'sKirklandLake,HammondReef,PandoraandWood-Pandora(50%interest)assetsandproperties.TheCompanyandYamanawilljointlyexploreandpotentiallydeveloptheKirklandLakeassets,andcontinueexplorationattheHammondReefprojectandthePandoraandWood-Pandoraproperties,throughCanadianMalarticCorporation.

PursuanttotheOsiskoArrangement,thefollowingassetsofOsiskoweretransferredtoNewOsisko:(i)a5.0%netsmelterroyaltyontheCanadianMalarticmine;(ii)C$157.0millionincash;(iii)a2.0%netsmelterroyaltyontheKirklandLakeassets,theHammondReefproject,andcertainotherexplorationpropertiesretainedbyCanadianMalarticCorporation;(iv)allassetsandliabilitiesofOsiskorelatingtotheGuerrerocampinMexico;and(v)certainotherinvestmentsandassets.


TheCompany'sandYamana'srelationshipwithrespecttotheCanadianMalarticmineisgovernedbyaunanimousshareholdersagreementwithrespecttoCanadianMalarticCorporationandageneralpartnershipagreementwithrespecttothePartnership.

DirecttransactioncoststotalingC$16.7millionwereincludedinthecostoftheinvestmentinOsisko.TheCompany'sshareofOsisko'sJune16,2014purchasepricewascomprisedof33,923,212oftheCompany'scommonsharesissuedtoformerholdersofOsiskoshares,C$502,059,784.01incashand871,680oftheCompany'scommonsharesissuedandheldbythedepositaryinrespectofunsecuredconvertibledebenturespreviouslyissuedbyOsiskothatremainedoutstandingfollowingtheOsiskoArrangement.OnJune30,2015,thenegotiatedearlysettlementofalloftheoutstandingunsecuredconvertibledebentureswascompleted.Asaresultofthissettlement,871,680commonsharesoftheCompanywithafairvalueofapproximately$24.8millionwerereleasedbythedepositarytothedebentureholders,alongwithacashpaymentofapproximately$10.1million.Additionalcashconsiderationof$3.2millionwaspaidtotheholdersoftheconvertibledebenturesuponsettlement.

AbusinessacquisitionreportinrespectoftheOsiskoArrangementwasfiledbytheCompanyontheSystemforElectronicDocumentAnalysisandRetrieval("SEDAR")onAugust22,2014.

OnNovember28,2014,theCompanycompleteditsacquisitionofalloftheissuedandoutstandingcommonsharesofCaydenResourcesInc.("Cayden"),aCanadianbasedgoldexplorationcompanylistedontheTSX-V,pursuanttoacourt-approvedplanofarrangementundertheBusinessCorporations Act (BritishColumbia).Caydenindirectlyholdsa100%interest,oranoptiontoearna100%interest,incertainminingpropertiesinJaliscoandGuerrero,Mexico,includingtheElBarquenoproperty.Underthetermsofthearrangement,eachshareholderofCaydenreceived0.09ofacommonshareoftheCompanyandC$0.01incash.Cayden,whichisnoworganizedunderthelawsofMexico,isnowanindirectwholly-ownedsubsidiaryofAgnicoEagle.

CapitalexpendituresbytheCompanyin2014were$475.4million.Thisincluded$76.6millionattheLaRondemine,$20.2millionattheLapamine,$34.3millionattheGoldexmine,$36.1millionattheCanadianMalarticmine,$106.2millionattheKittilamine,$48.4millionatthePinosAltosmine,$10.9millionattheCrestonMascotadepositatPinosAltos,$22.7millionattheLaIndiamine,$65.9millionattheMeadowbankmine,$48.3millionattheMeliadineprojectand$5.9millionatotherproperties.Inaddition,theCompanyincurred$25.9millionofexpendituresonminesiteexplorationand$56.0milliononexplorationactivitiesattheCompany'sexplorationpropertiesandoncorporatedevelopmentactivities.

2015

OnFebruary23,2015,AgnicoEagleenteredintoabindingletterofintent(the"LOI")withCanadianMalarticGP,YamanaandAbitibiRoyaltiesInc.("AbitibiRoyalties")regardingtheMalarticCHLprospectwhichabutstheCanadianMalarticmineandinwhichCanadianMalarticCorporationhelda70%interest,withtheremaining30%interestheldbyAbitibiRoyalties.OnMarch19,2015,AbitibiRoyaltiessoldits30%interestintheMalarticCHLprospecttoCanadianMalarticGP(the"CHLTransaction")inexchangefor459,197commonsharesoftheCompanyand3,549,685Yamanacommonshares,withavalueofapproximatelyC$35million(basedontherespectiveclosingpricesofsuchsharesontheTSXonFebruary20,2015,thedateimmediatelypriortothepublicannouncementbyAbitibiRoyaltiesofenteringintotheLOI),and3%netsmelterreturnroyaltiestoAbitibiRoyaltiesandNewOsiskoontheprospect.Inaddition,aspartoftheCHLTransactionallprioragreements,claimsandproceedingsrelatingtotheMalarticCHLprospect,includingthosepreviouslyinstitutedbyAbitibiRoyaltiesagainstOsiskopriortotheCompanyandYamanacompletingtheOsiskoArrangementwereterminated,settledandreleased.

PriortocompletionoftheOsiskoArrangementonJune6,2014,CliftonStarResourcesInc.("Clifton")institutedproceedingsagainstOsisko(nowCanadianMalarticCorporation)seeking,amongotherthings,anorderthatOsiskopayCliftonC$22.5millionindamages.Intheproceedings,Cliftonalleged,amongotherthings,thatOsiskowasobligatedtolendCliftonC$22.5milliononoraroundDecember1,2012pursuanttoaDecember10,2009commitmentletterandaDecember10,2009optionandjointventureagreement,eachbetweenCliftonandOsisko,andthatOsisko'sfailuretoadvancesuchloanresultedindamagestoClifton.CliftonfurtherallegedthatsuchloanwasintendedtobeusedtomakepaymentsundercertainoptionagreementsbetweenCliftonandthirdpartieswhichentitledCliftontoacquiresharesofsuchthirdpartiesthatownedinterestsintheconcessionscomprisingthe"DuparquetProject".FollowingthejointacquisitionofOsiskobytheCompanyandYamanaonJune16,2014,theCompanyandYamanaengagedindiscussionswithCliftontoadvancethesettlementofsuchclaims.EffectiveMarch2,2015,CanadianMalarticCorporation(asthesuccessortoOsisko)enteredintoasettlementagreementwithClifton,pursuanttowhichCanadianMalarticCorporationpaidCliftonapproximatelyC$5.27millioninconsiderationforafullandfinalreleaseofallclaimsarisingfromthefacts


describedintheCliftonproceedings.Concurrently,undertwoseparatenon-brokeredprivateplacements,eachoftheCompanyandYamanasubscribedfor4,772,786commonsharesofCliftonatapriceofC$0.60pershare,fortotalproceedstoCliftonofapproximatelyC$5.73million.

OnJune9,2015,theCompanycompleteditsacquisitionofalloftheissuedandoutstandingcommonsharesofSoltoroLtd.("Soltoro"),aCanadianbasedgoldexplorationcompanylistedontheTSX-V,pursuanttoacourt-approvedplanofarrangementundertheCanada Business CorporationsAct .Soltoroindirectlyholdsa100%interest,oranoptiontoearna100%interest,incertainminingpropertiesinJalisco,Mexico,includingtheElRayopropertywhichiscontiguouswiththeCompany'sElBarquenoproperty.Underthetermsofthearrangement,eachshareholderofSoltororeceived0.00793ofacommonshareoftheCompany,C$0.01incashandonecommonshareofanewlyformedOntariocompanynamedPalaminaCorp.valuedatC$0.02pershare.Soltoroisnowawholly-ownedsubsidiaryofAgnicoEagle.

OnJune11,2015,theCompanyacquiredfromOrexMineralsInc.("Orex")55.0%oftheissuedandoutstandingcommonsharesofGunnarnMiningAB("Gunnarn"),whichholdstheBarseleprojectinnorthernSweden.Considerationfortheacquisitionwascomprisedof$6millionpaidtoOrexatclosingandadditionalpaymentsof$2millionincashorAgnicoEaglecommonshares(attheCompany'ssolediscretion)duetoOrexoneachofthefirstandsecondanniversariesoftheclosing.TheCompanyhasalsocommittedtoincurring$7.0millioninexplorationexpendituresassociatedwiththeBarseleprojectbyJune11,2018,andmayearnanadditional15.0%interestinGunnarniftheCompanycompletesapre-feasibilitystudyrelatedtotheBarseleproject.TheCompanyholdsamajorityoftheseatsontheboardofdirectorsofGunnarnandisthesoleoperatoroftheBarseleproject.

OnSeptember30,2015,theCompanyenteredintoanotepurchaseagreementwithRessourcesQuébecInc.,asubsidiaryofInvestissementQuébec,providingfortheissuanceof$50millionprincipalamountof4.15%seniorunsecurednotesdue2025(the"2015NotePurchaseAgreement").TheCompanyhasagreedtoapplyanamountequaltoorgreaterthanthenetproceedsfromtheissuanceofthenotestowardstheexpansion,development,upgradeormaintenanceofminingprojectsintheProvinceofQuébec.Foradditionaldetailssee"MaterialContracts–NotePurchaseAgreements"below.

CapitalexpendituresbytheCompanyin2015were$449.8million.Thisincluded$67.3millionattheLaRondemine,$6.5millionattheLapamine,$48.8millionattheGoldexmine,$43.4millionattheCanadianMalarticmine,$56.4millionattheKittilamine,$61.8millionatthePinosAltosmine,$4.2millionattheCrestonMascotadepositatPinosAltos,$23.4millionattheLaIndiamine,$65.2millionattheMeadowbankmine,$66.7millionattheMeliadineprojectand$6.0millionatotherproperties.Inaddition,theCompanyincurred$10.2millionofexpendituresonminesiteexplorationand$100.2milliononexplorationactivitiesattheCompany'sexplorationpropertiesandoncorporatedevelopmentactivities.


ThefollowingtablesetsouttheCompany'sexpectedcapitalexpendituresfor2016.

Estimated 2016 Capital Expenditures

(millionsof$) SustainingDevelopment

ProjectsCapitalized Exploration

Northern Business LaRonde 62 – 2Lapa – – –Goldex 10 64 3Kittila 56 10 3Meadowbank 41 – –Meliadine – 96 –CanadianMalartic 59 2 – 228 172 8

Southern Business PinosAltos 54 7 2LaIndia 8 – 2CrestonMascota 7 – 1 69 7 5

ProjectEval/CorpDev OtherExploration – – 2 Total Expenditures 297 179 15

Pre-2013

Inthesecondquarterof2004,theCompanyacquiredanapproximate14%ownershipinterestinRiddarhyttanResourcesAB("Riddarhyttan"),aSwedishpreciousandbasemetalsexplorationanddevelopmentcompanythatwasatthetimelistedontheStockholmStockExchange.InNovember2005,theCompanycompletedatenderoffer(the"RiddarhyttanOffer")foralloftheissuedandoutstandingsharesofRiddarhyttanthatitdidnotown.TheCompanyissued10,023,882ofitscommonsharesandpaidandcommittedanaggregateof$5.1millioncashasconsiderationtoRiddarhyttanshareholdersinconnectionwiththeRiddarhyttanOffer.OnMarch28,2011,RiddarhyttanwasmergedwithAgnicoEagleABandAgnicoEagleSwedenAB,withAgnicoEagleSwedenABasthecontinuingentity.TheKittilamineiscurrently100%ownedbyAgnicoEagleFinlandOy,whichiswholly-ownedbyAgnicoEagleSwedenAB,anindirectsubsidiaryoftheCompany.

Inthefirstquarterof2005,theCompanyenteredintoanexplorationandoptionagreementwithIndustriasPenolesS.A.deC.V.("Penoles")toacquirethePinosAltospropertyinnorthernMexico.ThePinosAltospropertyiscomprisedofapproximately11,000hectaresintheSierraMadregoldbelt,approximately225kilometreswestofthecityofChihuahuainthestateofChihuahuainnorthernMexico.InFebruary2006,theCompanyexerciseditsoptionandacquiredthePinosAltospropertyonMarch15,2006.Underthetermsoftheexplorationandoptionagreement,thepurchasepriceof$66.8millionwascomprisedof$32.5millionincashand2,063,635commonsharesoftheCompany.

InFebruary2007,theCompanymadeanexchangeofferforalloftheoutstandingsharesofCumberlandResourcesLtd.("Cumberland")notalreadyownedbytheCompany.Atthetime,Cumberlandwasapre-productiondevelopmentstagecompanylistedontheTSXandAmericanStockExchangewhoseprimaryassetwastheMeadowbankproperty.InMay2007,theCompanyacquiredapproximately92%oftheissuedandoutstandingsharesofCumberlandthatitdidnotpreviouslyownand,inJuly2007,theCompanycompletedtheacquisitionofallCumberlandsharesbywayofacompulsoryacquisition.TheCompanyissued13,768,510ofitscommonsharesandpaid$9.6millionincashasconsiderationtoCumberlandshareholdersinconnectionwithitsacquisitionofCumberland.

InApril2010,theCompanyenteredintoanagreementinprinciplewithComaplexMineralsCorp.("Comaplex")toacquirealloftheoutstandingsharesofComaplexthatitdidnotalreadyown.Atthetime,Comaplexowneda100%interestinthe


advancedstageMeliadinegoldproperty,whichislocatedapproximately300kilometressoutheastoftheCompany'sMeadowbankmine.InMay2010,theCompanyexecutedthedefinitiveagreementswithComaplexand,inJuly2010byplanofarrangement,theCompanyacquired100%oftheMeliadinegoldpropertythroughtheacquisitionofComaplex,whichwasrenamedMeliadineHoldingsInc.Pursuanttothearrangement,ComaplextransferredtoGeomarkExplorationLtd.allassetsandrelatedliabilitiesotherthanthoserelatingtotheMeliadineproject.Inconnectionwiththearrangement,theCompanyissued10,210,848ofitscommonsharesasconsiderationtoComaplexshareholders.

InSeptember2011,theCompanyenteredintoanacquisitionagreementwithGraydResourceCorporation("Grayd"),aCanadian-basednaturalresourcecompanylistedontheTSX-V,pursuanttowhichtheCompanyagreedtomakeanoffertoacquirealloftheissuedandoutstandingcommonsharesofGrayd.Atthetime,Graydhelda100%interestintheLaIndiapropertylocatedintheMulatosGoldBeltofSonora,MexicoandhadrecentlydiscoveredtheTarachigoldporphyryprospectlocatedapproximatelytenkilometresnorthoftheLaIndiaproperty.InOctober2011,theCompanymadetheofferbywayofatake-overbidcircular,asamendedandsupplemented,and,inNovember2011,acquiredapproximately95%oftheoutstandingcommonsharesofGrayd.InJanuary2012,theCompanycompletedacompulsoryacquisitionoftheremainingoutstandingcommonsharesofGraydandGraydbecameawholly-ownedsubsidiaryoftheCompany.Inaggregate,theCompanyissued1,319,418ofitscommonsharesandpaidC$179.7millionincashasconsiderationtoGraydshareholdersinconnectionwiththetransaction.

OPERATIONS AND PRODUCTION Business Units and Foreign Operations

TheCompanyoperatesthroughthreebusinessunits:NorthernBusiness,SouthernBusinessandExploration.

TheCompany'sNorthernBusinessiscomprisedoftheCompany'soperationsinCanadaandFinland.TheCompany'sCanadianpropertiesincludetheLaRondemine,theLapamine,theGoldexmine,theMeadowbankmineandtheMeliadineproject,eachofwhichisa100%interesthelddirectlybytheCompany,anda50%interestintheCanadianMalarticMine,whichisheldindirectlythroughawholly-ownedsubsidiaryoftheCompanyandCanadianMalarticCorporation.TheCompany'soperationsinFinlandareconductedthroughitsindirectsubsidiary,AgnicoEagleFinlandOy,whichownstheKittilamine.In2015,theNorthernBusinessaccountedforapproximately78.9%oftheCompany'sgoldproduction.In2016,theCompanyanticipatesthattheNorthernBusinesswillaccountforapproximately79.3%oftheCompany'sgoldproduction.

TheCompany'sSouthernBusinessiscomprisedoftheCompany'soperationsinMexico.TheCompany'sPinosAltosmine,includingtheCrestonMascotadeposit,isheldthroughitssubsidiary,AgnicoEagleMexicoS.A.deC.V.TheLaIndiamineisownedbytheCompany'sindirectsubsidiary,AgnicoSonora,S.A.deC.V.In2015,theSouthernBusinessaccountedforapproximately21.1%oftheCompany'sgoldproduction.In2016,theCompanyanticipatesthattheSouthernBusinesswillaccountforapproximately20.7%oftheCompany'sgoldproduction.

TheCompany'sExplorationgroupfocusesprimarilyontheidentificationofnewmineralreservesandmineralresourcesandnewdevelopmentopportunitiesinpoliticallystableandprovengoldproducingregions.CurrentexplorationactivitiesareconcentratedinCanada,Europe,LatinAmericaandtheUnitedStates.Severalprojectswereevaluatedduring2015intheseregionswheretheCompanybelievesthepotentialforgoldoccurrencesisexcellentandwhichtheCompanybelievestobepoliticallystableandsupportiveoftheminingindustry.TheCompanycurrentlymanages70propertiesinCanada,5propertiesintheUnitedStates,3groupsofpropertiesinFinland,2propertiesinSwedenand18propertiesinMexico.ExplorationactivitiesaremanagedfromofficesinVald'Or,Quebec;Reno,Nevada;Chihuahua,HermosilloandGuadalajara,Mexico;Kittila,Finland;Storuman,Sweden;andVancouver,BritishColumbia.

Northern Business

LaRondeMine

TheLaRondemineissituatedapproximatelyhalfwaybetweenRouyn-NorandaandVald'OrinnorthwesternQuebec(approximately470kilometresnorthwestofMontreal,Quebec)inthemunicipalitiesofPreissacandCadillac.AtDecember31,2015,theLaRondeminewasestimatedtohaveprovenandprobablemineralreservescontainingapproximately3.1millionouncesofgoldcomprisedof18.2milliontonnesoforegrading5.31gramspertonne.TheLaRondemineconsistsoftheLaRondepropertyandtheadjacentElCocoandTerrexproperties,eachofwhichis100%ownedandoperatedbytheCompany.TheLaRondeminecanbeaccessedeitherfromVald'OrintheeastorfromRouyn-Norandainthewest,eachofwhicharelocatedapproximately60kilometresfromtheLaRondemineviaQuebecprovincial


highwayNo.117.TheLaRondemineissituatedapproximatelytwokilometresnorthofhighwayNo.117onQuebecregionalhighwayNo.395.TheCompanyhasaccesstotheCanadianNationalRailwayatCadillac,Quebec,approximatelysixkilometresfromtheLaRondemine.

TheCompanyfirstacquiredaninterestintheLaRondepropertyin1974throughanindirectinvestmentinDumagamiMinesLimited("Dumagami").TheCompanyacquired100%oftheoutstandingsharesofDumagamionDecember19,1989,andonDecember29,1992,Dumagamitransferredallofitspropertyandassets,includingtheLaRondemine,totheCompanyandsubsequentlydissolved.

TheLaRondemineoperatesunderminingleasesobtainedfromtheMinistryofEnergyandNaturalResources(Quebec)andundercertificatesofapprovalgrantedbytheMinistryofSustainableDevelopment,EnvironmentandtheFightAgainstClimateChange(Quebec).TheLaRondepropertyconsistsof36contiguousminingclaimsandoneprovincialmininglease.TheElCocopropertyconsistsof22contiguousminingclaimsandoneprovincialmininglease.TheTerrexpropertyconsistsof21miningclaimsandoneprovincialminingleasethatwasacquiredinJuly2014.TheminingleasesontheLaRonde,ElCocoandTerrexpropertiesexpirein2018,2021and2034,respectively,andareautomaticallyrenewableforthreefurtherten-yeartermsuponpaymentofasmallfee.TheCompanyalsohasthreesurfacerightsleasesthatrelatetothewaterpipelinerightofwayfromLakePreissacandtheeasternextensionoftheLaRondetailingspond#7ontheElCocoproperty.Thesurfacerightsleasesarerenewableannually.

LocationMapoftheLaRondeMine(asatDecember31,2015)

TheLaRondemineincludesundergroundoperationsattheLaRondeandElCocopropertiesthatcanbothbeaccessedfromthePennaShaft,amill,atreatmentplant,asecondarycrusherbuildingandrelatedfacilities.In2003,explorationworkstartedtoextendoutsideoftheLaRondepropertyontotheTerrexpropertywhereadown-plungeextensionofZone20Northwasdiscovered.TheTerrexpropertyissubjecttoa5%netprofitsroyaltyinfavourofDelferGoldMinesInc.TheCompanydoesnotexpecttopayroyaltiesinrespectofthispartofthepropertyin2016.Inaddition,theCompanyowns100%oftheSphinxpropertyimmediatelytotheeastoftheElCocoproperty.In2015,85%oftheoreprocessedfromtheLaRondeminewasextractedfromthedeeperportionoftheLaRondemine(thatis,belowLevel245)orthe"LaRondemineextension".In2016,theCompanyanticipatesthatapproximately89%oftheoreprocessedwillbefromthisdeeperpartofthemine.


TheCompanyexpectsfutureby-productmetalproductionattheLaRondeminetodeclineasoperationscontinuetoshifttowardsdeepersectionsoftheminewheregoldgradesarehigherandby-productmetalsarelessprevalent.Theassociateddecreaseinby-productrevenuesisexpectedtoresultinhighertotalcashcostsperounceonaby-productbasisattributabletooreextractedfromthesepartsofthemine.

MapoftheAbitibiregionshowingthelocationoftheLaRonde,Lapa,GoldexandCanadianMalarticMines


Mining and Milling Facilities

SurfacePlanoftheLaRondeMine(asatDecember31,2015)

TheLaRondeminewasoriginallydevelopedwitha1,207-metreshaft(Shaft#1)andanundergroundrampaccesssystem.TherampaccesssystemisavailabledowntoLevel25ofShaft#1andcontinuesdowntoLevel299atthePennaShaft.ThemineralreserveaccessiblefromShaft#1wasdepletedinSeptember2000andShaft#1isnolongerinuse.Asecondproductionshaft(Shaft#2),locatedapproximately1.2kilometrestotheeastofShaft#1,wascompletedin1994toadepthof525metresandwasusedtomineZones6and7.BothorezonesweredepletedinMarch2000andtheworkingswereallowedtoflooduptoLevel6(approximately280metres).Athirdshaft(thePennaShaft),locatedapproximately800metrestotheeastofShaft#1,wascompleteddowntoadepthof2,250metresinMarch2000.ThePennaShaftisusedtomineZones20North,20South,6and7.

In2006,theCompanyinitiatedconstructionoftheLaRondemineextension.HoistingfromthisdeeperpartoftheLaRondeminebeganinthefourthquarterof2011andcommercialproductionwasachievedinNovember2011.AccesstothedeeperpartoftheLaRondemineisprovidedthrougha823-metreinternalshaft(Shaft#4)startingfromLevel203,foratotaldepthof2,858metresbelowthesurfacewhichwascompletedinNovember2009.Arampisusedtoaccessthelowerpartoftheorebodydownto3,110metresbelowthesurface.AninternalwinzesystemisusedtohoistorefromdepthtofacilitiesonLevel215,approximately2,150metresbelowthesurface,whereitistransferredtothePennaShafthoist.

ProductionfromtheLaRondemineextensioncontinuestomovetowardsanticipatedsteady-statelevels.Asaresult,logisticalproblems,suchascongestionintheundergroundworkings,occurfromtimetotime.TheCompanyanticipatesthattheseissues,andanyotherissuesthatmaypreventordelayextractionandtransportationoforefromaparticular


stope,willbelessprevalentwhenthestopedevelopmentworkatdepthismoreadvanced.Mostofthedelaysencounteredduring2015wererelatedtoseismicity.

ThecoolingplantonLevel262beganoperatinginDecember2013.Thiscoolingsystemreducesthefrequencyofheatrelateddelaysexperiencedinpreviousyearsinthedeepestpartofthemine.Theventilationnetworkisexpectedtocontinuetoexpandoverthenextfewyearstoincreasetheairflowinthedeeperareasofthemine.

In2015,theCompanycompletedtheinstallationofacoarseoreconveyorsystemthatextendsfromLevel292tothecrusheronLevel280.Thenewconveyorsystemwascommissionedinthesecondhalfof2015.Aneworepassandsilodesignedtofeedtheconveyorsystemareexpectedtobecommissionedinthesecondquarterof2016.Thenewconveyorisexpectedtoimproveminingflexibilityandincreasetherobustnessofthesystem.Thissystemisexpectedtoreducecongestioninthedeeperportionsofthemineandincreasethecapacitytomovematerial.

Mining Methods

TheprimarysourceoforeattheLaRondeminecontinuestobefromundergroundminingmethods.During2015,twominingmethodswereused:longitudinalretreatwithcementedrockbackfillorpastebackfillandtransverseopenstopingwithcementedrockbackfill,pasteorunconsolidatedbackfill.Inaddition,toaddressconcernsregardingthefrequencyandintensityofseismiceventsencounteredatthelowerlevelsoftheLaRondemine,ahybridofthesetwomethodshasbeendevelopedandused.Intheundergroundmine,sublevelsaredrivenatbetween30-metreand40-metreverticalintervals,dependingonthedepth.Stopesareundercutin15-metrewidepanels.Inthelongitudinalmethod,panelsareminedin15-metresectionsandbackfilledwith100%cementedrockbackfillorpastebackfill.Thepastebackfillplantwascompletedin2000andislocatedonthesurfaceattheprocessingfacility.Inthetransverseopenstopingmethod,approximately50%oftheoreisminedinthefirstpassandfilledwithcementedrockbackfillorpastebackfill.Onthesecondpass,theremainderoftheoreisminedandfilledwithunconsolidatedwasterockbackfillorcementedpastebackfill.

ThethroughputatLaRondein2015averaged6,141tonnesperdaycomparedwith6,244tonnesperdayin2014(basedon334workingdays).Thereducedthroughputin2015wasduetothelowerspecificgravityofthematerialandthecontinuingtransitiontothelowermine,wherefactorssuchasheat,congestion,seismicityandlackofoperationalflexibilityundergroundhadanegativeimpactonthemine'sabilitytoprovidetheplannedtonnagetothemill.In2015,approximately85%oftheorewasextracted(mucked)fromtheLaRondemineextension.In2016,thisproportionisexpectedtobeapproximately89%.

TheCompany'soperationsattheLaRondeminereachmorethanthreekilometresbelowthesurface.Thereareveryfewresourcesavailabletomodelthegeomechanicalconditionsatthisdepth,whereoperationsaresubjecttohighstresslevels.TheCompanyconductsperiodictechnicalreviewsofitsoperationsattheselevelsusingconsultantswithexperienceindeepmining.TheCompanyusestheresultsofthesetechnicalreviewstoadaptbestminingpracticesandadjusttheminingsequenceforitsoperationsattheselevels.

Surface Facilities

SurfacefacilitiesattheLaRondemineincludeaprocessingplantwithadailycapacityof7,200tonnesofore,whichhasbeenexpandedfourtimessince1987fromtheoriginalrateof1,630tonnesperday.Beginningin1999,transitiontotheLaRondemine'spolymetallicmassivesulphideorebodyrequiredseveralmodificationstotheprocessingplant.In2008,theinstallationofalimitedcopper/leadseparationflotationcircuit,followingthecopperflotationcircuit,wascompleted.Alsoin2008,acyanidationplantbeganoperationforthetreatmentofsulphideconcentratefromtheGoldexmine.ACILcircuitwascompletedandbeganoperationinApril2013toreplacetheexistingLaRondepreciousmetalMerrill-Crowecircuit.TheLaRondemineisalsothesitefortheLapamineoreprocessingplant(1,500tonnesperday),whichwascommissionedinthesecondquarterof2009.

Theorerequiresaseriesofgrinding,copper/leadflotationandseparation,zincflotationandzinctailspreciousmetalsleachingcircuits,nowfollowedbyCILrecovery.Pastebackfillandcyanidedestructionplantsoperateintermittently.Thetailingsareahasadedicatedcyanidedestructionandmetalsprecipitationplantthatwaterpassesthroughpriortorecirculatingtothemill.Duringthesummerof2014,theinstallationofanewseriesofprocessingtanksbeganinordertoincreasetheprocessingtime.ThisinstallationwascompletedinMarch2015withthereplacementoftheoldseriesoftanksthathavebeeninoperationsince1993.Abiologicalwatertreatmentplantwascommissionedin2005toaddressthebuild-upofthiocyanateinthetailingspondsattheLaRondemine.Thisbuild-upwastheresultofthehighsulphidecontentoftheLaRondemineoreandhighrateofrecirculationoftheprocesswater.Theplantusesbacteriatooxidizeanddestroythiocyanateinthewaterandremovesphosphatepriortoitsreleasetotheenvironment.


TheGoldexconcentratecircuitconsistsofpulpreceivedfromtheGoldexmillviatruckandsubsequentleachingofthepulpwithcyanide.TheleachedmaterialissenttotheLapaCILcircuitforgoldrecoveryalongwithLaparesidualpulp.TheGoldexconcentratecircuitceasedtooperateinNovember2011followingthesuspensionofminingoperationsatGoldex.Inthefourthquarterof2013,miningoperationresumedintheMandEZonesoftheGoldexmineandtheGoldexconcentratecircuitresumedoperation.FromMay2014toApril2015,theGoldexconcentratewasprocessedintheLapaCILcircuit.SinceApril2015,theGoldexconcentratehasbeenprocessedintheLaRondeCIPcircuit.

TheLapamineoreprocessingplantconsistsofatwo-stagegrindingcircuittoreducethegranularityoftheore.Agravityrecoverycircuitthatisincorporatedintothegrindingcircuitrecoversupto45%oftheavailablegold,dependingonfeedgrades.TheresidualpulpisleachedinaconventionalCILcircuittodissolvethebalanceofthepreciousmetal.Acarbonstripcircuitrecoversthegoldfromthecarbonwhichisrecycledtotheleachcircuit.

Production and Mineral Recoveries

During2015,theLaRondeminehadpayableproductionof267,921ouncesofgold,915,720ouncesofsilver,3,501tonnesofzincand4,941tonnesofcopperfrom2,241,424tonnesoforegrading3.91gramsofgoldpertonneand16.47gramsofsilverpertonne,0.31%zincand0.27%copper.Thetotalcashcostsperounceofgoldproducedonaby-productbasisatLaRondein2015was$590andonaco-productbasiswas$760.TheLaRondeprocessingfacilityaveraged6,141tonnesoforeperdayandoperated93.15%ofavailabletime.TheminesitecostspertonneatLaRondewasC$99.71.Goldandsilverrecoveryaveraged95.02%and77.17%,respectively.Zincrecoveryaveraged50.22%withaconcentratequalityof51.93%zinc.Copperrecoveryaveraged81.35%withaconcentratequalityof20.65%copper.

ThefollowingtablesetsoutthemetalrecoveriesandconcentrategradesattheLaRondeminein2015.

Copper Concentrate (25,282 tonnes

produced)

Zinc Concentrate (7,947 tonnes produced)

Head

Grades Grade Recovery Grade Recovery

Overall Metal

RecoveriesPayable

Production

Gold 3.91g/t 235.7g/t 68.02% 19.2g/t 1.73% 95.09% 267,921oz

Silver 16.47g/t 644.7g/t 44.16% 194.6g/t 4.23% 84.25% 915,720oz

Copper 0.27% 20.65% 86.03% 0% 0% 86.03% 4,942t

Zinc 0.31% 1.66% 6.04% 51.93% 59.26% 59.26% 3,501t

AnnualproductionattheLaRondeminein2016isexpectedtobeapproximately275,000ouncesofgold,1,030,000ouncesofsilver,4,575tonnesofcopperand4,117tonnesofzincfrom2.1milliontonnesoforegrading4.28gramspertonneofgold,20.0gramspertonneofsilver,0.30%copperand0.35%zinc.Thetotalcashcostsperounceofgoldproducedin2016onaby-productbasisareexpectedtobe$592,withgoldrecoveryestimatedat94.9%,silverrecoveryof76.0%,copperrecoveryof80.8%andzincrecoveryof56.1%.GoldrecoveryattheLaRondemineisdistributedapproximatelyasfollows:68.0%inthecopperconcentrate,1.8%inthezincconcentrateand25.3%vialeaching.MinesitecostspertonneofC$114areexpectedin2016.

Environmental, Permitting and Social Matters

Currently,wateristreatedatvariousfacilitiesattheLaRondemine.Watercontainedinthetailingsthatistobeusedasundergroundbackfillistreatedtodegradecyanideusingasulphurdioxideandairprocess.Thetailingsenteringthetailingspondarefirstdecantedandtheclearwatersubjectedtonaturalcyanidedegradation.Thiswateristhentransferredtopolishingpond#1toundergoasecondarytreatmentataplantlocatedbetweenpolishingponds#1and#2thatusesaperoxysilicateprocesstodestroycyanide,andlimeandcoagulant(ferricsulfate)areusedtoprecipitatemetals.Thetailingspondoccupiesanareaofabout175hectares.Wasterockthatisnotusedundergroundforbackfillisbroughtuptothesurfaceandstoredincloseproximitytothetailingspondtobeusedtobuildcofferdamsandberms


insidethepondtoincreasestoragecapacity.Awasterockpilecontaininglessthan100,000tonnesofwasteandoccupyingaboutninehectaresislocatednorthofthemill.

DuetothehighsulphurcontentoftheLaRondemineore,theCompanyhashadtoaddresstoxicityissuesinthetailingspondssincethe1990s.Thetreatmentprocesshasbeenstablesinceintroducingandoptimizingabiologicaltreatmentplantin2004,andtheeffluenthasremainednon-toxicsince2006.In2006,theCompanycommencedanammoniastrippingoperationinvolvinganeffluentpartiallytreatedbythebiologicaltreatmentplantwhichallowedanincreaseintreatmentflowrate,whilekeepingthefinaleffluenttoxicity-free.Inaddition,waterfromacidrockdrainagearoundthemillsandthewastestockpilearetreatedtoremovemetalspriortodischargeatahighdensitysludgelimetreatmentplantlocatedattheLaRondemill.In2015,thefinalphaseoftheconstructionofamajorcofferdamwascompletedtoanelevationof356metres.Bermswillbecompletedin2016tofinalizethe356cofferdamconcept.

Capital Expenditures

CapitalexpendituresattheLaRondemineduring2015wereapproximately$67.3million,whichincludedsustainingcapitalexpenditures,deferredexpenseandincludedcapitalizeddrilling.Budgeted2016capitalexpendituresattheLaRondemineare$62million,excludingcapitalizeddrilling.

Development

In2015,atotalof12,795metresoflateraldevelopmentwascompleted.Developmentwasfocusedonthepreparationofthelowermineproductionhorizon.Atotalof7,318metresofdevelopmentworkwascompletedfortheLaRondemineextensioninfrastructureandtheramptoaccesstheLaRondemineextension.

TheCompanyisalsoevaluatingthepotentialtodevelopandminetheBousquetZone5ontheadjoiningBousquetpropertyusingundergroundrampaccess.TheminingmethodislikelytobesimilartothatcurrentlyemployedattheGoldexmine(long-holestoping,withcementedpastebackfill),andprocessingcoulduseexcesscapacityfromtheLapacircuitatLaRonde.Dewateringoftheoldpitisunderwayandpermitapplicationstocollectabulksampleareexpectedtobesubmittedshortly.Aninternaltechnicalstudyiscurrentlyexpectedtobecompletedbytheendof2016.

Atotalof12,700metresoflateraldevelopmentisplannedfor2016.Themainfocusofdevelopmentremainsthelowermine(LaRondeextensionarea),thedevelopmenttowardthelowestlevelsandtheWestmineportion.

Geology, Mineralization and Exploration

Geology

TheLaRondepropertyislocatednearthesouthernboundaryoftheArchean-age(2.7billionyearsold)AbitibiSubprovinceandthePontiacSubprovincewithintheSuperiorGeologicalProvinceoftheCanadianShield.ThemostimportantregionalstructureistheCadillac-LarderLake("CLL")faultzone,markingthecontactbetweentheAbitibiandPontiacSubprovinces,locatedapproximatelytwokilometrestothesouthoftheLaRondeproperty.

ThegeologythatunderliestheLaRondemineconsistsofthreeeast-west-trending,steeplysouth-dippingandgenerallysouth-facingregionalgroupsofrockformations.Fromnorthtosouth,theyare:(i)400metres(approximatetruethickness)oftheKewagamaGroup,whichismadeupofathickbandofinterbeddedwacke;(ii)1,500metresoftheBlakeRiverGroup,avolcanicassemblagethathostsalltheknowneconomicmineralizationontheproperty;and(iii)500metresoftheCadillacGroup,madeupofathickbandofwackeinterbeddedwithpeliticschistandminorironformation.

Zonesofstrongsericiteandchloritealterationthatenclosemassivetodisseminatedsulphidemineralization(includingtheorethatisminedforgold,silver,zincandcopperattheLaRondemine)followsteeplydipping,east-west-trending,anastomosingshearzonestructureswithintheBlakeRiverGroupvolcanicunitsacrosstheproperty.TheseshearzonesarepartofthelargerDoyon-DumagamiStructuralZonethathostsseveralimportantgoldoccurrences(includingtheDoyongoldmine,theWestwoodprojectandtheformerBousquetmines)andhasbeentracedforovertenkilometreswithintheBlakeRiverGroup,fromtheLaRondeminewestwardtotheMouskagoldmine.

Mineralization

TheLaRondedepositisaworld-classgold-richvolcanogenicmassivesulphide(VMS)deposit.LaRondelenseswereformedmainlybysulphideprecipitationfromhydrothermalfluidsontheseafloorandbyreplacementbelowlenses.ThestackingoftheLaRondelensesistheresultofsuccessivevolcanicevents,intercalatedbycyclesofhydrothermatactivityassociatedwithreactivationofsynvolcanicfaults.


Thegold-bearingzonesattheLaRondeminearelensesofdisseminatedstringersthroughtomassiveaggregatesofcoarsepyritewithzinc,copperandsilvercontent.Tenzonesthatvaryinsizefrom50,000to40,000,000tonneshavebeenidentified,ofwhichfourare(orarebelievedtobe)economic.Goldcontentisnotproportionaltothetotalsulphidecontentbutdoesincreasewithcoppercontent.Goldvaluesarealsohigherinareaswherethepyritelensesarecrosscutbytightlyspacednorth-southfractures.

Thesehistoricalrelationships,whichwerenotedatLaRondeShaft#1'sMainZone,aremaintainedatthePennaShaftzones.Thezinc-silver(i.e.Zone20North)mineralizationwithlowergoldvalues,commonintheuppermine,gradesintogold-coppermineralizationwithinthelowermine.ThepredominantbasemetalsulphideswithintheLaRondeminearechalcopyrite(copper)andsphalerite(zinc).

TheCompanybelievesthatZone20Northisoneofthelargestgold-bearingmassivesulphidemineralizedzonesintheworldandoneofthelargestknownmineralizedzonesintheAbitibiregionofOntarioandQuebec.Zone20NorthcontainsthemajorityofthemineralreservesandmineralresourcesattheLaRondemine,including17.9milliontonnesofprovenandprobablemineralreservesgrading5.36gramsofgoldpertonne,representing98%ofthetotalprovenandprobablemineralreservesattheLaRondemine,6.3milliontonnesofindicatedmineralresourcesgrading3.54gramsofgoldpertonne,representing92%ofthetotalmeasuredandindicatedmineralresourcesattheLaRondemine,and7.8milliontonnesofinferredmineralresourcesgrading4.44gramsofgoldpertonne,representing85%ofthetotalinferredmineralresourcesattheLaRondemine.

Zone20Northextendsbetween700metresbelowthesurfaceandatleast3,700metresbelowthesurface,andremainsopenatdepth.Withincreasedaccessonthelowerlevelsofthemine(i.e. ,belowLevel215andfromtheinternalshaftonlevels257and278),thetransformationfromazinc/silverorebodytoagold/copperdepositisexpectedtocontinueduring2016.

Zone20Northcanbedividedintoanupperzinc/silverenrichedgoldpoorzoneandalowergold/copperenrichedzone.Thezinc/silverzonehasbeentracedoveraverticaldistanceof1,700metresandahorizontaldistanceof570metres,withthicknessesapproaching40metres.Thegold/copperzonehasbeentracedoveraverticaldistanceofover2,200metresandahorizontaldistanceof900metres,withthicknessesvaryingfromthreeto40metres.Thezinc/silverzoneconsistsofmassivezinc/silvermineralizationcontaining50%to90%massivepyriteand10%to50%massivelightbrownsphalerite.Thegold/copperzonemineralizationconsistsof30%to70%finelydisseminatedtomassivepyritecontaining1%to10%chalcopyriteveinlets,minordisseminatedsphaleriteandrarespecksofvisiblegold.Goldgradesaregenerallyrelatedtothechalcopyriteorcoppercontent.Atdepth,themassivesulphidelensbecomesricheringoldandcopper.During2015,2.0milliontonnesoforegrading4.02gramsofgoldpertonne,15.91gramsofsilverpertonne,0.22%zincand0.28%copperwereminedfromZone20North.

Exploration and Drilling

ThecombinedamountofgoldinprovenandprobablemineralreservesattheLaRondemineattheendof2015was3.11millionounces(18.2milliontonnesoforegrading5.31gramsofgoldpertonne,19.73gramsofsilverpertonne,0.24%copperand0.81%zinc),whichrepresentsadecreaseof323,000containedouncesofgoldfromtheendof2014,afterproducing267,921ouncesofgold(282,000ouncesin-situgoldminedin2015).Thereductioninmineralreservesisprincipallyassociatedwithoreminedduring2015anddelineationanddefinitiondrillingdoneattheedgesandinthedeepestpartoftheorebody,respectively.UndergroundindicatedmineralresourcesattheLaRondemineincreasedby51,000tonnesoforetoatotalof6.8milliontonnesoforegrading3.49gramsofgoldpertonne,18.25gramsofsilverpertonne,0.24%copperand0.82%zinc,primarilyduetopositivediamonddrillingresultsintheconversiondrillingonthewesternmarginabovelevel284andbelowthedeeperlevelofmineralreserves(level311).UndergroundinferredmineralresourcesattheLaRondemineincreasedby348,000tonnesoforetoatotalof9.1milliontonnesoforegrading4.26gramsofgoldpertonne,15.07gramsofsilverpertonne,0.23%copperand0.90%zinc.TheconversionofinferredmineralresourcestoindicatedmineralresourcesinZone20Northatdepthwasoffsetbypositiveexplorationdrillingbelow3.4kilometresdepth.

DiamonddrillingisusedforexplorationontheLaRondeproperty.In2015,26holes(8,994metres)weredrilledfordefinition(conversion)drillingand23holes(10,511metres)wereforexploration.ExpendituresondiamonddrillingattheLaRondemineduring2015wereapproximately$2.9million,including$1.4millionindrillingexpenseschargedtocapitalcostsattheLaRondemine,and$1.5millionexpensedasexplorationdrilling.

Themainfocusofthe2015explorationprogramwascontinuingtheinvestigationandconversionofZone20NorthatdepthandexplorationoftheZone6and7horizonsatdepthfromthenewaccessesdevelopedin2012and2013onLevels290,292and293.The2015conversionprogramonZone20Northwasfocusedonconversionfrominferredto


indicatedmineralresourcesabovelevel281onthewesternmarginandatdepth,intheeasternandcenterportionsofthedeposit(belowtheactuallimitofmineralreserves).Thepositiveresultsobtainedinthisprogramallowedtheadditionofindicatedmineralresourcesbetweenlevel269and281onthewestmarginandcontinuedtoconfirmtheextensionoftheorebodyto3.3kilometresbelowthesurface,or200metresbelowthecurrentmaximumdepthofmineralreserves.Theconversionprogramwillcontinuein2016through2018,andwillinvestigatetheorebodyto3.7kilometresbelowthesurfaceandtothewest.Aspartofthe2015explorationprogram,drillingwasconductedontheeastandcenterportionoftheZone20Northbetween3.4and3.7kilometersbelowthesurface.Positiveresultsallowedtheadditionofinferredmineralresourcesatdepth,mostlytotheeastoftheorebody.Thiscampaignwillcontinuetothewestin2016.The2015explorationprogramalsoincludedafollowupcampaignontheZone6and7horizonsfromthenewlydevelopedaccessesonLevel293.In2012,adeepholefromLevel215intersectedtheZone6horizonatadepthof3,551metresbelowthesurface.The22.8metrethickmassivesulphidezonehadthesamecharacteristicsasotherdepositsontheproperty.In2013,afirstfollowupcampaignwasplannedfromLevel278todeterminetheextentofthedepositbutthecampaignwasstoppedduetoexcessivedeviationduringthedrillingofthefirsthole.TheCompanydecidedtodelaytheprogramuntilnewaccessesweredevelopedfromthelowerlevelsofthemine(Level293)andtheaccessonLevel293wasdevelopedin2014.ThedrillingcampaignstartedinOctober2014andwillcontinueinto2016totestthecontinuityofZone6from2.9to3.2kilometresbelowthesurface.Anotherdrillingaccessisplannedtobedevelopedfrom2016through2019toprovidebetterpositioningforanextensivediamonddrillingprogramonZone6toadepthof3.7kilometres.

In2016,theCompanyexpectstospend$1.9millionon14,115metresofdefinition(conversion)drillingand$2.0millionon11,850metresofexplorationdrilling,foratotalof$3.9millionattheLaRondemine.

LapaMine

TheLapamine,whichachievedcommercialproductioninMay2009,islocatedapproximately11kilometreseastoftheLaRondeminenearCadillac,QuebecandisaccessiblebyQuebecprovincialhighwayNo.117.AtDecember31,2015,theLapaminewasestimatedtocontainprovenandprobablemineralreservesof0.78millionouncesofgoldcomprisedof0.44milliontonnesoforegrading5.49gramspertonne.TheLapapropertyismadeupoftheTonawandaproperty,whichconsistsof44contiguousminingclaimsandoneprovincialmininglease,andtheZulapaproperty,whichconsistsofoneminingconcession.TheminingleaseatLapaexpiresin2029.

LocationMapoftheLapaMine(asatDecember31,2015)


TheCompany'sinitialinterestintheLapapropertywasacquiredin2002throughanoptionagreementwithBreakwaterResourcesLtd.("Breakwater").TheCompanyundertookanaggressiveexplorationprogramanddiscoveredanewgolddepositalmost300metresbelowthesurface.In2003,theCompanypurchasedtheLapapropertyfromBreakwaterforapaymentof$8.9million,a1%netsmelterreturnroyaltyontheTonawandapropertyanda0.5%netsmelterreturnroyaltyontheZulapaproperty.In2008,theCompanypurchasedallroyaltiesfromBreakwaterforC$6.35million.Inaddition,boththeZulapaandTonawandapropertiesaresubjecttoa5%netprofitroyaltypayabletoDelferGoldMinesInc.In2004,anadditionalminingclaimwasaddedtotheCompany'sholdingsattheLapamineandinJanuary2009,aminingleasewasenteredintowiththeMinistryofEnergyandNaturalResources(Quebec).


SurfacePlanoftheLapaMine(asatDecember31,2015)

TheLapapropertyhostsanundergroundminingoperationandtheoreistruckedtoaprocessingfacilityattheLaRondemine,whichhasbeenmodifiedtotreattheore,recoverthegoldandstoretheresidues.TailingsfromtheLapaminearedepositedinthetailingspondattheLaRondemine.

InJuly2004,theCompanyinitiatedthesinkingofan825-metredeepshaftattheLapaproperty.InApril2006,2,800tonnesofdevelopmentorewasextractedatLapaandwasestimatedtocontain,onaverage,10.65gramsofgoldpertonne.Theseresultsandresultsfromothersamplingmethodswereincorporatedintoafeasibilitystudyand,inJune2006,theCompanyacceleratedconstructionoftheLapamine.Thisconstructionincludedextendingtheshafttoadepthof1,369metres,whichwascompletedinOctober2007.SignificantadditionalconstructionwasrequiredinorderfortheLapaminetoachievecommercialproductioninMay2009,includingtheconstructionoftheLapamineoreprocessingfacilityattheLaRondemine.


Mining Methods

TwoundergroundminingmethodsareusedattheLapamine:longitudinalretreatwithcementedbackfillandlocallytransverseopenstopingwithcementedbackfill.Sublevelsaredrivenat30-metreverticalintervals.Stopesareminedin12-metresectionsandbackfilledwith100%cementedrockbackfill.TheundergroundinfrastructureattheLapamineispredominantlylocatedinareaswithstablerockconditions.However,incertainareas,theundergroundinfrastructureislocatedinatalcchloriteschist(mainlyorezones),whichmayhaveahigherpotentialofinstability.ThisriskofinstabilityismanagedattheLapaminethroughagroundcontrolprogram.ExcavatedorefromtheLapamineistruckedviaprovincialhighwaytotheprocessingfacilityattheLaRondemine.

Surface Facilities

TheinfrastructureontheLapapropertyincludestherefurbishedformerLaRondeShaft#1headframeandshafthouse,servicebuildings,offices,asettlingpondforwastewater,dryfacilities,anorebin,adieselreservoirandawatertreatmentplant.AbackfillplantwascommissionedinDecember2008andthesedimentationpondwasextendedin2007tocontrolsuspendedsolidsfromundergrounddewateringdischarge.

OrefromtheLapamineisprocessedindedicatedmillingfacilitiesintegratedintothemillattheLaRondemine.Withanaverageproductionof1,651tonnesperdayin2015,themineoperatedconsistentlyaboveitsdesignrateof1,500tonnesperday.Dilution,mainlyassociatedwithtalcchloriteschistfromthesouthwall,averaged71%in2015,consistentwithprioryears.


During2015,theLapaminehadpayableproductionof90,967ouncesofgoldfrom559,926tonnesoforegrading5.83gramsofgoldpertonne.ThetotalcashcostsperounceofgoldproducedatLapain2015was$590onaby-productbasisandwas$591onaco-productbasisandtheLapaprocessingfacilityaveraged1,534tonnesperdayandoperatedapproximately93.7%ofavailabletime.Goldrecoveryaveraged86.47%andtheminesitecostspertonneatLapawereC$117in2015.

ThefollowingtablesetsoutthemetalrecoveriesattheLapaminein2015.

Head Grade

Overall Metal

RecoveryPayable

Production

Gold 5.83g/t 86.47% 90,967oz

Goldproductionduring2016attheLapamineisexpectedtobeapproximately60,000ouncesfrom0.41milliontonnesoforegrading5.3gramsofgoldpertonneatestimatedtotalcashcostsperounceofapproximately$640onaby-productbasis,andestimatedgoldrecoveryof86.8%.MinesitecostspertonneofapproximatelyC$123areexpectedin2016.Basedonthelifeofmineplan,2016isexpectedtobethefinalyearoffullproductionattheLapamine.


100%ofthewaterusedundergroundattheLapaminewasinitiallyre-circulatedfromminedewateringaftersettlinginthesedimentationpond.Toreduceammonialevelbuild-upandreducetheammoniacontentinthewater,theCompanybuilta3.5-kilometresurfacepipelinetoobtainfreshwaterfromtheHevaRiver.ThepipelinewascommissionedinNovember2009.TheCompanyalsocommissionedawatertreatmentplantonsiteinthefourthquarterof2010toremovetheammoniaintheminedewateringwater.Outputiscurrentlywithinthetargetrangeatapproximatelytenpartspermillionofammoniaandaverageefficiencyisatapproximately70%.

Inthesecondquarterof2012,anOberlinfiltrationunitwasinstalledinsidethetreatmentplanttoimprovetheremovalofsuspendedsolidsfromwatercomingfromundergroundoperations.Despitetheadditionalfiltration,theprocessremainssensitivetovariationsintheconcentrationsofsuspendedsolidsandmanagingitrequiresparticularattention.Thewasterockpilenaturallydrainstowardsthesedimentationpond.Awasterocksamplingprogramimplementedduringtheshaftsinkingphaseverifiedthenon-acidgeneratingnatureofthewasterock.WatereffluentfromthesedimentationpondissampledasrequiredundertheQuebecandCanadianminingeffluentguidelines.TheorefromtheLapamineis


transportedandprocessedattheLapamill,whichislocatedadjacenttotheLaRondemill.TheLapatailingsaresenttotheLaRondeminetailingsarea.

TheCertificatesofAuthorizationtoproceedwithmineproductionandwithmillconstructionwereissuedbytheMinistryofSustainableDevelopment,EnvironmentandtheFightAgainstClimateChange(Quebec)inOctoberandDecember2007,respectively.TheCertificateofAuthorizationformillandtailingsproductionwasreceivedin2008.

ArevisiontotheclosureplanfortheLapaminewassubmittedtotheMinistryofEnergyandNaturalResources(Quebec)in2009andwasapprovedin2012.Financialassurancehasbeenprovidedbasedontheclosureplan.


In2015,theCompanyincurredapproximately$5.3millionincapitalexpendituresattheLapamine,whichincludeddeferreddevelopmentandsustainingcapitalexpenditures(includingundergroundconstructionandminingequipment),butexcludedcapitalizeddrilling.NocapitalexpendituresattheLapamineareexpectedin2016.

Development

In2015,atotalof3,919metresoflateraldevelopmentwascompleted.Developmentfocusedonpermanentdrifts(rampsandhaulageway),stopepreparationandaccesstosatellitezonesandthelowerportionsoftheContactZone.

Atotalof482metresoflateraldevelopmentisplannedfor2016.Themainfocusofdevelopmentworkwillbestopepreparationandaccesstotheorebody.


Geology

TheLapapropertyislocatednearthesouthernboundaryoftheArchean-age(2.7billionyearsold)AbitibiSubprovinceandthePontiacSubprovincewithintheSuperiorProvinceoftheCanadianShield.ThemostimportantregionalstructureistheCLLfaultzonemarkingthecontactbetweentheAbitibiandPontiacSubprovinces.Thefaultzonepassesthroughthepropertyfromwesttoeast,andismarkedbyschistsandmafictoultramaficvolcanicflowsthatcomprisethePichégroup(uptoapproximately300metresthickintheminearea).OntheLapaproperty,thefaultzonedisplaysa"Z"shapedfoldtowhichallofthelithologicgroupsintheregionconform.FeldspathicdykescutthePichégroup,especiallynearthefold.NorthofthePichégroupliestheCadillacsedimentarygroup,whichconsistsof500metresormoreofwell-bandedwacke,conglomerateandsiltstonewithintercalationsofironformation.ThePontiacgroupsedimentaryrocks(uptoapproximately300metresthick)thatoccurtothesouthofthePichégrouparesimilartotheCadillacgroupbutdonotcontainconglomeratenorironformation.

Mineralization

GoldoccurrencesintheCadillac-RivièreHévasectorareallveintypeepigeneticdepositsspatiallyassociatedwiththeCadillac-LarderLakedeformationzone.Assuch,allthedepositsoccurwithinorproximaltothePichéGroup.Thesedepositsarerelativelyarsenic-enrichedandoccurasquartzveinsandveinletsorassulphidedisseminations.ItisgenerallyagreedthatthegoldmineralizationintheCadillacregionwasemplacedafterregionaldeformationandmetamorphism.

TheLapadepositiscomprisedoftheContactZoneandfivesatellitezones.TheContactZoneaccountsforapproximately60%ofthemineralreserves.

Theorezonesaremadeupofmultiplequartzveinsandveinlets,oftensmokyandanastomosing,withinashearedandalteredenvelopecontainingminorsulphidesandvisiblegold.TheContactZoneisgenerallylocatedatthecontactbetweenthePichégroupandtheCadillacgroup.ThesatellitezonesarelocatedwithinthePichégroupatadistancevaryingfromtento50metresfromthecontactwiththeCadillacgroup,exceptforthesatellitezones7and8at150metresfromthissamecontact,andtheContactNorthZone,whichislocatedapproximatelytenmetresnorthoftheContactZonewithintheCadillacgroup.Theshearedenvelopeconsistsofmillimetre-thickfoliationbandsofbiotiteorsericitewithsilicaand,inplaces,cutsacrossrockunits.Quartzveinsandmillimetre-sizedveinletsparalleltothefoliationaccountfor5%to25%ofthemineralization.Visiblegoldiscommonintheveinsandveinletsbutcanalsobefoundinthealteredhostrock.Sulphidesaccountfor1%to3%ofthemineralization;themostcommonsulphides,inorderofdecreasingimportance,arearsenopyrite,pyrite,pyrrhotiteandstibnite.Graphiteisalsorarelyobservedasinclusionsinsmokyquartzveins.


TheContactandsatellitezonesaretabularmineralizedenvelopesorientedeast-westanddippingverysteeplytothenorth,turningsouthatdepth.Theeconomicportionofthezonehasbeentracedfromdepthsofapproximately450metrestomorethan1,500metresbelowthesurface.TheContactZonehasanaveragestrikelengthof300metres,variesinthicknessfrom2.8to5.0metresandisopenatdepth.Locally,somethickerintervalshavebeenintersectedbuttheircontinuityhasnotbeendemonstrated.ThesatellitezoneshavethicknessessimilartotheContactZone.


TheLapaprojecthadalonghistoryofworkbypreviousownersbeforebeingacquiredbytheCompanyin2003.Thisincludedproductionof345,844tonnesoforegrading4.3gramspertonneofgoldbyLapa-CadillacGoldMinesfrom1938to1943,andthecompletionof15,100metresofdrillingfromundergroundoperationsduringthisperiod.GoldmineralizationwasintersectedwithinthePichévolcanicgroupbyCanadianMalarticGoldMines,whichdrilledeightholes(1,200metres)in1955.From1981until1989,Breakwatercompletedline-cutting,groundgeophysics,geologicalsurveys,drilled164holes(26,616metres)andexcavateda759-metre-longexplorationramp,recognizingfivegold-bearinghorizonsinthePichévolcanicgroup.In1988,theCompanypreparedamineralresourceestimateforthe"Highway"zoneof676,177tonnesoforegrading5.3gramspertonneofgold(suchhistoricestimateisnotcompliantwithNI43-101standards).In1999,CambiorExplorationCanadadrilledfourholes(2,926metres)testingthedepthcontinuityofZoneAandtheContactZone.

Overall,therewasadecreaseofapproximately92,000ouncesofgoldinmineralreservesattheLapaminein2015,to78,000ouncesofgold(0.4milliontonnesoforegrading5.49gramsofgoldpertonne),afterproducing90,967ouncesofgold(105,000ouncesin-situgoldmined).Thenetdecreasewasaresultoftheconversionofindicatedmineralresourcesintomineralreserves,offsetbyproduction.UndergroundmeasuredandindicatedmineralresourcesattheLapamineincreasedby67,000tonnesoforein2015toatotalof1.1milliontonnesoforegrading4.26gramsofgoldpertonne,mainlyduetoconversiondrillingintheLapaDeepsector.Approximately326,000tonnesofinferredmineralresourcesgrading6.52gramsofgoldpertonnewereaddedin2015foratotalof1.4milliontonnesoforegrading6.52gramsofgoldpertonne,asaresultofsurfaceandundergroundexplorationdrillingin2015.Drillingandevaluationwillcontinuein2016.

In2015,atotalof138holesweredrilledontheLapapropertyforatotallengthof29,960metres.Ofthedrillingin2015,89holes(13,692metres)werefordefinition(conversion)and49holes(16,268metres)wereforexploration.ExpendituresondiamonddrillingattheLapamineduring2015wereapproximately$2.3million,including$1.2millionindefinitiondrillingexpenseschargedtocapitalcostsand$1.1millionexpensedonexplorationdrilling.

FourexplorationdiamonddrillingprogramswerecompletedattheLapamineduring2015.ThefirstprogramwasexecutedfromsurfacetargetingtheZulapaZ8corridorinordertoaddmineralresources.ThesecondprogramconcentratedonexpandingtheZulapaZone7atdepth.TherewerepositiveresultsintheZulapaZ8zonesurfacedrillingandtheundergroundZulapaZ7zonedeepexplorationprogram.Additionaldrillinginbothoftheseareasisplannedin2016.

ThegoalofthethirdprogramwastoaddandconvertmineralresourcesintomineralreservesinZulapaZone7and73.However,drillingdemonstratedanon-exploitablenarrowlensintheZulapaZ73zone.ThefourthprogramwasexecutedfromtheexplorationtrackdriftonLevel101(onekilometrebelowsurface)testingtheeasternextensionoftheContactEastZoneandthewesternportionofthePichégroupvolcanicrockonthePandoraproperty(inwhichtheCompanyholdsanindirect50%interestthroughCanadianMalarticCorporation).Technicaldifficultieswereencounteredintheholesdrilledfromtheexplorationtrackdrift,becausethedrillinganglewastooclosetothefoliationangle.Furthertestdrillingwillbedoneatdepthin2016,aswideareasarestillunexplored.

In2016,theCompanyexpectstospendapproximately$0.8millionon10,400metresofexplorationdrillingattheLapamineand$1.3millionon15,000metresofundergroundexplorationdrillingonthePandoraproperty.Atotalof1,080metresoflateraldevelopmentisplannedfor2016onthetrackedexplorationdriftonthePandoraproperty.

GoldexMine

TheGoldexmineislocatedintheCityofVald'Or,Quebec,approximately60kilometreseastoftheLaRondemine,andisaccessiblebyQuebecprovincialhighwayNo.117.TheprovenandprobablemineralreservesatGoldexasatDecember31,2015wereestimatedatapproximately0.67millionouncesofgoldcomprisedof12.9milliontonnesoforegrading1.61gramspertonne,allintheM,EandDZones.


TheGoldexmineoperatesunderaminingleaseobtainedfromtheMinistryofEnergyandNaturalResources(Quebec)andundercertificatesofapprovalgrantedbytheMinistryofSustainableDevelopment,EnvironmentandtheFightAgainstClimateChange(Quebec).TheGoldexpropertyconsistsof22contiguousminingclaimsand,sinceApril2008,oneprovincialmininglease.Thepropertyismadeupofthreeblocks:theProbeblock;theDaltonblock;andtheGoldexExtensionblock.Theclaimsarerenewableeverysecondyearuponpaymentofasmallfee.Theminingleaseexpiresin2028andisautomaticallyrenewableforthreefurtherten-yeartermsuponpaymentofasmallfee.TheCompanyalsohasonesurfaceleasethatisusedfortheauxiliarytailingspond.Thisleaseisrenewableannuallyuponpaymentofafee.

TheGEZ,whichwasthegolddepositonwhichtheCompanywasfocusingitsproductioneffortsbeforeproductionwassuspendedindefinitelyonOctober19,2011,wasdiscoveredin1989ontheGoldexExtensionblock(althoughtheCompanybelievesasmallportionoftheGEZoccursontheProbeblock).OnNovember29,2012,theCompanypurchasedthe5%netsmelterreturnroyaltyinterestontheProbeblockfromProbeMinesLimited("Probe")forcashconsiderationofC$14million.AnadditionalC$4millionwaspaidbytheCompanytoProbein2015ascertainproductionthresholdswereachievedontheProbeblockin2014.

LocationMapoftheGoldexMine(asatDecember31,2015)

AgnicoEaglehashelda100%interestintheGoldexpropertysinceDecember1993,whentheCompanyacquiredtheremaining46.3%interestinGoldexMinesLimitedthatitdidnotalreadyown.Inlate1997,theCompanycompletedaminingstudythatindicatedthattheGEZdepositwasnoteconomicallyviabletomineatthethen-prevailinggoldprice(approximately$323perounceofgold)usingtheminingapproachchosenandthedrill-hole-indicatedgrade.Thepropertywasplacedoncareandmaintenanceandtheworkingswereallowedtoflood.InFebruary2005,anewmineralreserveandmineralresourceestimatewascompletedfortheGEZwhich,coupledwithafeasibilitystudy,ledtoaprobablemineralreserveestimateof1.6millionouncesofgoldcontainedin20.1milliontonnesoforegrading2.54gramsofgoldpertonne.TheGEZresourcemodelwasrevisedand,inMarch2005,theCompanyapprovedafeasibilitystudyandtheconstructionoftheGoldexmine.ThemineachievedcommercialproductiononAugust1,2008.


BasedontheresultsofascopingstudycompletedinJuly2009,theCompanydecidedtoexpandthemineandmilloperationsatGoldexto8,000tonnesperday.Thisprojectwascompletedin2010.Capitalcostsinconnectionwiththeexpansiontotaled$10million.Thecrusherfortheexpansionwascommissionedattheendofthefirstquarterof2010atarateof7,811tonnesperday.

OnOctober19,2011,theCompanysuspendedminingoperationsandgoldproductionfromtheGEZ,followingthereceiptofrecommendationsfromindependentconsultantstohaltundergroundminingoperationsduringtheinvestigationintogeotechnicalconcernswiththerockabovethemininghorizon.Asaresult,theCompanywroteoffsubstantiallyallofitsinvestmentintheGoldexmine(approximately$254million),recordedaclosureprovisionofapproximately$44millionandreclassifiedalloftheremaining1.6millionouncesofprovenandprobablemineralreserves,otherthantheorestockpiledonthesurface,asmineralresourcesinthethirdquarterof2011.ThesurfacestockpilewasprocessedintheGoldexmillbyOctober30,2011.Surfaceremediation,intheformofcementinjectionandothercorrectiveworktothemine'ssurfaceinfrastructure(includingtoShaft#2)wascarriedoutin2012and2013.

TheCompanydoesnotexpecttoproducemoregoldfromtheGEZuntilthegeotechnicalconcernswiththerockabovethemininghorizonareresolved,whichmayneveroccur.

InJuly2012,theCompanyapprovedthedevelopmentoftheMandEZonesoftheGoldexmine.Productionfromthesezonesbeganinthefourthquarterof2013andcommercialproductionwasachievedinOctober2013.DevelopmentworkiscontinuingundergroundontheMandEZones.

In2013,afeasibilitystudywascarriedoutontheM2,M3,M4andM5Zones,nowpartoftheMZone,andtheeastpartoftheEZone.ThisfeasibilitystudyindicatedthatminingthesezonesconcurrentlywiththeMandEZonesappearedeconomical.TheCompanyanticipatesthatthecommencementofoperationsonthesenewsatellitezoneswillresultinincreaseddailythroughputofthemineandminelifebeingextendedfurtherinto2017.

In2015,followingthecompletionofapositiveinternaltechnicalstudy,theGoldexDeep1projectwasapprovedforproductionbyAgnicoEagle'sboardofdirectors(the"Board"or"BoardofDirectors").ThestudyfocusedonminingthelowerpartoftheDxZoneandthetoppartoftheDZonefromadepthof850metresto1,200metres.TheCompanyplanstoundertakedevelopmentfromthecurrentGoldexinfrastructure,withexistingequipmentandpersonnel.Theplannedminingmethodislong-holestopingwithcementedpastebackfill,whichisthesamemethodascurrentlyusedattheMandEZones.



SurfacePlanoftheGoldexMine(asatDecember31,2015)

ThesurfacefacilitiesatGoldexincludeaheadframe,ahoistroom,anorestoragefacility,aprocessingplant,apastebackfillplantandasurfacebuildingcontainingamechanicalshop,awarehouseandanoffice.Inaddition,theGoldexpropertyhasa790-metredeepshaft(Shaft#1),whichhistoricallywasusedtoprovideaccesstoundergroundworkings.Shaft#1isnowpredominantlyusedforgettingmaterialintothemineandservesasanemergencyexitfromthemine.

Thesinkingofanewproductionshaftwascompletedin2007.Thisshaft(Shaft#2)isa5.5-metrediametershaftwitha50-centimetrethickconcreteliningandisusedforventilationaswellashoistingpurposes.Shaft#2is865metresdeepandincludesfivestations.Arefurbishedfrictionhoistwasinstalledforproductionandserviceduties,andanauxiliaryhoistwasinstalledforemergencyandpersonnelservice.

RehabilitationoftheoldrampnearShaft#1wascompletedin2015toaccesstheupperportionoftheMZone.Therampwillbeusedforgettingmaterialintothemineandasanemergencyexit.Inaddition,anewheatingsystematsurfacewasinstalledinearly2015.

Mining Method

TheCompanyminestheMandEZonesusingprimaryandsecondarystopemethods.DrillingiscarriedoutwithITHdrills.Productionholesareeither4.5or6.5inchesindiameter.Bulkemulsionisusedastheprimaryexplosiveforstopeblasting.Forbothzones,stopesareapproximately55metreshigh.Thewidthandlengthofindividualstopesvarybasedonlocalrockmassquality,butanaveragestopeisexpectedtorangebetween60,000and120,000tonnes.OrehandlingintheMZoneisdonewith15yardload-haul-dumpmachines.Thisequipmentunloadsintoanorepassaccessiblefrom


eachlevel.IntheEZone,locatedbelowthebottomofShaft#2,orehandlingisdonewith15yardload-haul-dumpmachinesand45tonnetrucks.

Allstopesaresupportedwith10-15metrecablebolts.Inaddition,thestabilityofcertainstopesisremotelymonitoredinrealtime.TheCompanyalsousespastebackfilltoallowforahighextractionratioandtoincreaselongtermstability.

ThesameminingmethodwillbeusedintheDeep1ZoneasisusedintheMandEZones,exceptthataRail-VeyorsystemwillbeusedfororehandlingbetweenthelowermostlevelofDeep1(Level120)andthecurrentorehandlingfacilities(Level76).TheRail-VeyorloadingsystemonLevel120willbefedviaarockbreakerroomatLevel115.ForLevels85to115,15yardloadhauldumpmachineswillunloadintoanorepassreportingtotherockbreakerroomonLevel115.ForthestopesonLevel120,45tonnetruckswillbeusedfororehandlingtoLevel115.

Surface Facilities

PlantconstructionatGoldexcommencedinthesecondquarterof2006andwascompletedinthefirstquarterof2008.Theplantreacheddesigncapacityinthesecondquarterof2009.GrindingattheGoldexmillwasinitiallydonethroughatwo-stagecircuitcomprisedofaSAGmillandaballmill.In2009,asurfacecrusherwasaddedtoreducethesizeoforetransferredtothesurfacefrom150millimetresto50millimetres.Alamellardecanterwasalsoaddedtorecoversmallparticlespresentinthewateroverflowoftheconcentratethickener.Theunderflowpumpforthisthickenerwasupgradedfollowingflotationcircuitmodificationtoincreasethepullrateofthesmallparticles.Approximatelytwo-thirdsofthegoldisrecoveredthroughagravitycircuit,passedovershakingtablesandsmeltedonsite.Theremainderofthegoldandpyriteisrecoveredthroughaflotationprocess.TheconcentrateisthenthickenedandtruckedtothemillattheLaRondeminewhereitisfurthertreatedbycyanidation.GoldrecoveredisconsolidatedwithpreciousmetalsfromtheLaRondeandLapamines.

In2013,anewbackfillplantwasbuiltonthesite.TheplantprovidesfillfortheMandEZonestopes.Thetailingthickenerunderflowfeedsthebackfillplantandtwodiskfiltersincreasethedensitybeforethecontinuousmixerwherebinderisaddedataratioofapproximately3.6%beforebeingsenttotheundergroundminewithapositivedisplacementpump.Currently,thecapacityofthebackfillplantisapproximately6,200tonnesperday.

In2013,metallurgicaltestingonorefromtheMandEZonesshowedthatthecementinthebackfillwouldhaveanegativeimpactontheefficiencyoftheflotationcircuit.Asaresult,apHcontrol(usingcarbondioxide),areservoirandcontrolvalveswereaddedtothemill.

TheoreproductionrateatGoldexin2015averaged6,549tonnesperday,comparedwith5,799tonnesperdayin2014.Theincreasedthroughputin2015waslargelyduetoacceleratedmininglevelscomparedtothe2014period.


In2015,metallurgicaltestswerecompletedontheDeep1oretoverifyitscompatibilitywiththecurrentoperationalparametersemployedattheGoldexmill,includinghardnesstests,grindabilitysizing,gravimetricrecoveryandflotationalrecoveryofgold.

During2015,theGoldexminehadpayableproductionof115,426ouncesofgoldfrom2.3milliontonnesoforegrading1.66gramsofgoldpertonne.ThetotalcashcostsperounceofgoldproducedatGoldexin2015was$538onaby-productbasisandonaco-productbasis.TheGoldexprocessingfacilityaveraged6,336tonnesoforeperday.Goldrecoveryaveraged93.43%.TheminesitecostspertonneatGoldexin2015wereC$33.

ThefollowingtablesetsoutthemetalrecoveriesattheGoldexminein2015.

Head Grade

Overall Metal

RecoveryPayable

Production

Gold 1.66g/t 93.43% 115,426oz

Goldproductionduring2016attheGoldexmineisexpectedtobeapproximately105,000ouncesfrom2.3milliontonnesoforegrading1.52gramsofgoldpertonneatestimatedtotalcashcostsperounceofapproximately$601onaby-productbasis,withestimatedgoldrecoveryof92.6%.MinesitecostspertonneofapproximatelyC$35areexpectedin2016.



EnvironmentalpermitsfortheconstructionandoperationofanoreextractinginfrastructureattheGoldexminewerereceivedfromtheMinistryofSustainableDevelopment,EnvironmentandtheFightAgainstClimateChange(Quebec)inOctober2005.Thepermitsalsocoveredtheconstructionandoperationofasedimentationpondforminewatertreatmentandsewagefacilities.InJune2011,thepermitswererevisedtoallowfortheexpansionofthemineandmilloperationsto9,500tonnesperday.InJune2012,environmentalpermitswerereceivedfortheconstructionandoperationofapastebackfillplantinconnectionwiththedevelopmentoftheMandEZones.

InNovember2006,theCompanyandtheQuebecgovernmentsignedanagreementpermittingtheCompanytodisposeGoldextailingsattheManitousite,atailingssiteformerlyusedbyanunrelatedthirdpartyandabandonedtotheQuebecgovernment.TheManitoutailingssitehasissuesrelatingtoaciddrainage,andtheconstructionoftailingsfacilitiesbytheCompanyandthedepositionoftailingsfromGoldexontheManitoutailingssitewasacceptedbytheMinistryofSustainableDevelopment,EnvironmentandtheFightAgainstClimateChange(Quebec)asavalidrehabilitationmethodtoaddresstheacidgenerationproblematManitou.Undertheagreement,theCompanymanagestheconstructionandoperationofthetailingsfacilitiesandtheQuebecgovernmentpaysalladditionalcostsabovetheCompany'sbudgetfortailingsfacilitiessetoutintheGoldexfeasibilitystudy.TheQuebecgovernmentretainsresponsibilityforallenvironmentalcontaminationattheManitoutailingssiteandforfinalclosureofthefacilities.TheCompanyhasalsobuiltaseparatetailingsdepositarea(auxiliarytailingspond)neartheGoldexmine.EnvironmentalpermitsfortheconstructionandoperationoftheauxiliarytailingspondwerereceivedinMarch2007.TherehabilitationoftheManitoutailingssiteisexpectedtocontinueduringtheminingoftheMandEZones.

Internaldykeswerebuiltin2013attheManitoutailingssitetomakebetteruseofthereducedquantityofavailabletailingsforrehabilitationoftheManitousite.

AsatDecember31,2015,theestimatedremainingreclamationcostsrelatingtotheGoldexmineareapproximately$11.8million.


CapitalexpendituresattheGoldexmineduring2015wereapproximately$44.7million,whichincludedsustainingcapitalexpenditures,expansionconstructionanddeferredexpenses,butexcludedcapitalizeddrilling.Totalestimatedcapitalexpendituresfor2016are$76million,excludingcapitalizeddrilling.

Development

During2015,approximately10,853metresoflateraldevelopmentwerecompletedattheGoldexmine.Atotalof817metresofverticaldevelopmentwasalsocompletedinordertoestablishboththeorepasssystemservicingtheMZoneandtheventilationnetworkservicingtheMandDeep1Zones.In2015,rehabilitationofthesurfacerampwascompleted,whichprovidesincreasedoperationalflexibilityandaccesstotheM2andM5satellitezones.

Atotalof12,929metresoflateraldevelopmentisplannedforallzonesin2016,while604metresofverticaldevelopmentwillbenecessarytoextendtheorepasssystemandtoensureproperventilationoftheupperpartoftheMandDeep1Zones.In2016,40,000metresofadditionaldrillingisplannedfortheDeep1Zone.However,themajorityofthebudgetwillbefortheconstructionoftheundergroundgarageandore-handlingfacilities,includingtheRail-Veyorsystem,therock-breakerroomandtheelectricaldistributionnetwork.


Geology

TheGoldexpropertyislocatednearthesouthernboundaryoftheArchean-age(2.7billionyearsold)AbitibiSubprovince,atypicalgranite-greenstoneterranelocatedwithintheSuperiorProvinceoftheCanadianShield.ThesoutherncontactoftheAbitibiSubprovincewiththePontiacSubprovinceismarkedbytheeast-southeasttrendingCLLfaultzone,themostimportantregionalstructuralfeature.TheGoldexdepositishostedwithinaquartzdioritesill,the"GoldexGranodiorite",locatedinasuccessionofmafictoultramaficvolcanicrocksthatareallgenerallyorientedwest-northwest.

In2015,explorationeffortsatGoldexwerefocusedontheM,EandDeepZones.Thesezonesaredefinedbytheintensityofthequartztourmalineveinstockworkandgoldassays.In2015,withtheincreaseddensityofdrilling,theM,M2andMxzoneswereconsolidatedintotheMZoneandtheDxandDzoneswereconsolidatedintotheDeep1Zone.NoexplorationwasconductedonthePZonein2015.


TheMZonehasanapproximatelengthof440metres,aheightof350metresandathicknessof130metres.TheEZone,adjacenttotheeasternendoftheGEZ,hasanapproximatelengthof250metres,aheightof290metresandathicknessof130metres.TheDeep1Zoneisapproximately90metresbelowtheGEZandextendsto1,500metresbelowthesurface.Itappearstohaveanapproximatestrikelengthof350metres,aheightof600metresandthicknessof120metres.

Mineralization

GoldmineralizationatGoldexcorrespondstotheclassicalquartz-tourmalineveinlode-golddeposittype.Thegold-bearingquartz-tourmalinepyriteveinsandveinstockwork,hostedwithinaquartz-dioritedyke,aretheresultofastrongstructuralcontrol,relatedtoductileshearingandbrittlefaulting.Themostsignificantstructuredirectlyrelatedtomineralizationisadiscreteshearzone,theGoldexMylonite,whichisuptofivemetreswideandoccurswithintheGoldexGranodiorite,justsouthoftheDeep1ZoneandnorthoftheMZone.

AcoupleofveinsetsexistwithintheM,E,Deep1andPZones,ofwhichthemainsetconsistsofextensional-shearveinsdippingapproximately30degreessouth.Theveinsetsandassociatedalterationhaloscombinetoformstackedenvelopesupto30metresthick.

Moderatetostrongalbite-carbonatealterationofthehost-rockquartzdioritesurroundsthequartz-tourmaline-pyriteveinsandcoversalmost80%ofthemineralizedzone;outsideoftheenvelopes,priorchloritealterationaffectsthequartzdioriteandgivesitadarkergrey-greencolour.Occasionally,enclavesofrelativelyunalteredmediumgrey-green-colouredquartzdiorite(withnoveiningorgold)arefoundwithintheM,EandDeep1Zones;theyareremovedwiththerestofthestope'soretoallowforasmoothstopeshape,requiredforminingpurposes.

Mostofthegoldoccursasmicroscopicparticlesthatarealmostalwaysassociatedwithpyrite,generallyadjacenttograinsandcrystalsbutalso20%includedwithinthepyrite.Thegold-bearingpyriteoccursinthequartz-tourmalineveinsandinnarrowfracturesinthealbite-carbonate-alteredquartzdiorite(generallyimmediatelyadjacenttotheveins).


ExplorationontheGoldexpropertywasconcentratedinthreeperiodsfrom1963to1996.Duringtheperiodfrom1985to1996,Shaft#1wassunkto457metres,followedby3,810metresoflateraldevelopmentand520metresofslashing,abulksampleofroughly55,886tonnesandapproximately32,000metresofdiamonddrillingintheMainZone.Concurrently,widelyspaceddrilling,comprisedofapproximately50diamonddrillholes,ledtothediscoveryandbeginningofthedevelopmentoftheGEZ.In1996,Shaft#1wasdeepenedto790metres,followedby853metresoflateraldevelopment,cross-cutsandslashing,twobulksamplesfor136,200tonnesand23,000metresofundergrounddrillinginGEZ.

ThecombinedamountofgoldinprovenandprobablemineralreservesattheGoldexmineattheendof2015was0.67millionounces(12.9milliontonnesoforegrading1.61gramsofgoldpertonne),whichrepresentsanincreaseofapproximately328,000ouncesofgoldinreservesfromtheendof2014,afterproducing115,426ouncesofgold(123,000ouncesin-situgoldmined).Theincreaseislargelyduetothesuccessfulconversionofmineralresourcestomineralreserves,mainlyintheDZoneaswellasintheMandEZones.ThesearetheinitialDZoneprobablemineralreserves(354,000ouncesofgoldin6.3milliontonnesoforegrading1.75gramsofgoldpertonne)relatedtotheapprovalofminingtheDeep1project,announcedinJuly2015.Themineralreservegradeincreased8%from1.49gramsofgoldpertonneattheendof2014to1.61gramsofgoldpertonneattheendof2015.UndergroundmeasuredandindicatedmineralresourcesattheGoldexmineincreasedby0.7milliontonnesoforeto34.4milliontonnesoforegrading1.87gramsofgoldpertonne,primarilyduetoconversionofinferredtoindicatedmineralresources,reductionofthecut-offgradeandpositivedrillingresultsintheE,DxandDeepZones.In2015,therewasadecreaseininferredmineralresourcesofapproximately4.6milliontonnesoforeto24.6milliontonnesoforegrading1.53gramsofgoldpertonne.Thisdecreaseintheinferredmineralresourceswasprimarilyduetoaconversionofinferredtoindicatedmineralresources,reductionofthecut-offgradeandpositivedrillingresultsintheE,Mx,M,DxandDeepZones.

DiamonddrillingatGoldexin2015totaled449holesforatotallengthof73,085metres.Ofthistotal,69holes(12,187metres)wereforexplorationoftheM,Deep1andSouthZonesatacostof$0.6million,210holes(47,567metres)wereforconversiondrillingprincipallyintheDeep1andMxZonesatacostof$2.7million,138holes(10,477metres)weredelineationdrillingintheMandEZonesatacostof$0.5millionand32holes(2,854.8metres)wereholesdrilledfortheengineeringandminingdepartmentsatacostof$0.3million.Otherexploration-relatedexpensesin2015includedrampdevelopmentandametallurgicalstudyoftheDeepZoneore.

In2016,theCompanyexpectstospend$1.0millionon14,300metresofexplorationdrilling,$3.3millionon32,300metresofconversiondrillingand$0.8millionon10,000metresofdelineationdrilling.


CanadianMalarticMine

TheCanadianMalarticmineislocatedapproximately25kilometreswestoftheCityofVal-d'Orand80kilometreseastofCityofRouyn-Noranda.TheminelieswithinthetownofMalartic.ItstraddlesthetownshipsofFournière,MalarticandSurimau.AtDecember31,2015,theCanadianMalarticminewasestimatedtohaveprovenandprobablemineralreservescontainingapproximately7.73millionouncesofgoldcomprisedof221.53milliontonnesoforegrading1.08gramspertonne.

TheCompanyacquiredits50%interestintheCanadianMalarticmineonJune16,2014throughitsjointacquisitionofOsiskowithYamana.See"GeneralDevelopmentoftheBusiness–Three-YearHistory–2014"forfurtherdetailsoftheCompany'sacquisitionofits50%interestintheCanadianMalarticmine.

TheCanadianMalarticmineoperatesunderminingleasesobtainedfromtheMinistryofEnergyandNaturalResources(Quebec)andundercertificatesofapprovalgrantedbytheMinistryofSustainableDevelopment,EnvironmentandtheFightAgainstClimateChange(Quebec).TheCanadianMalarticmineiscomprisedoftheEastAmphiproperty,theCHLMalarticprospectandtheCanadianMalarticproperty.TheCanadianMalarticmineconsistsofacontiguousblockcomprisingoneminingconcession,fiveminingleasesand208miningclaims.

ExpirationdatesfortheminingleasesontheCanadianMalarticpropertyvarybetweenMarch23,2019andFebruary17,2034,andareautomaticallyrenewableforthreefurtherten-yeartermsuponpaymentofasmallfee.

TheCanadianMalarticminecanbeaccessedeitherfromVald'OrintheeastorfromRouyn-NorandainthewestviaQuebecprovincialhighwayNo.117.Apavedroadrunningnorth-southfromthetownofMalartictowardsMourierLakecutsthroughthecentralareaoftheCanadianMalarticproperty.TheCanadianMalarticpropertyisfurtheraccessiblebyaseriesofloggingroadsandtrails.TheCanadianMalarticmineisalsoservicedbyarail-linewhichcutsthroughthemiddleofthetownofMalartic.ThenearestairportislocatedinVal-d'Or,about25kmeastoftheCanadianMalarticmine.

Abufferzone135metreswidehasbeendevelopedalongthenorthernlimitoftheopenpittomitigatetheimpactsofminingactivitiesonthecitizensofMalartic.Insidethisbufferzone,alandscapedridgewasbuiltmainlyusingrockandtopsoilproducedduringpre-strippingwork.Theheightofthislandscapedridgeis15metreswheretheconcentrationofresidentsishigherandfivetosixmetresnearlesspopulatedareas.


LocationMapoftheCanadianMalarticMine(asatDecember31,2015)

TheCanadianMalarticmineincludesopenpitoperations,anadministration/warehousebuilding,amineoffice/truckshopbuilding,aprocessplantandthecrushingplant.

FollowingthejointacquisitionoftheCanadianMalarticminebytheCompanyandYamana,mostoftheminingclaimsaresubjecttoa5%netsmelterreturnroyaltypayabletoNewOsisko.TheminingclaimscomprisingtheCHLMalarticprospectaresubjectto3%netsmelterreturnroyaltiespayabletoeachofNewOsiskoandAbitibiRoyaltiesInc.Inaddition,ofthe208miningclaimsconstitutingtheCanadianMalarticproperty,101arealsosubjecttoothernetsmelterreturnroyaltiesthatvarybetween1%and2%,payableundervaryingcircumstances.In2015thePartnership,whichistheoperatoroftheCanadianMalarticmine,paidC$53.0millionintheaggregatewithrespecttothesenetsmelterreturnroyalties,andexpectstopayapproximatelyC$50.8millionin2016.

GoldwasfirstdiscoveredintheMalarticareain1923.GoldproductionontheCanadianMalarticpropertybeganin1935andcontinueduninterrupteduntil1965.Followingvariousownershipchangesovertheensuingyears,OsiskoacquiredownershipoftheCanadianMalarticpropertyin2004.BasedonafeasibilitystudycompletedinDecember2008,Osiskocompletedconstructionofa55,000tonneperdaymillcomplex,tailingsimpoundmentarea,5millioncubicmetrepolishingpondandroadnetworkbyFebruary2011andthemillwascommissionedinMarch2011.TheCanadianMalarticmineachievedcommercialproductiononMay19,2011.From2011untilDecember31,2015,theCanadianMalarticmineproduced2.17millionouncesofgoldand1.90millionouncesofsilverfrom78.4milliontonnesoforegrading0.97gramsofgoldpertonneand1.04gramsofsilverpertonne.

AsofDecember31,2010,theCanadianMalarticminehadreceivedallformalgovernmentpermitsrequiredforitsconstructionandrelatedactivities,withtheexceptionoftheauthorizationforthemillandmineoperations.TheofficialcertificateofauthorizationforthemillandoperationswasgrantedonMarch31,2011,atwhichpointtheCanadianMalarticminewasfullypermitted.



SurfacePlanoftheCanadianMalarticMine(asatDecember31,2015)

TheCanadianMalarticmineisalargeopenpitoperationcomprisingtheCanadianMalarticandBarnatpits.ThePartnershipcontinuestoworkwiththeQuebecMinistryofTransportandthetownofMalarticonthedeviationofQuebecprovincialhighwayNo.117togainaccesstothehighergradeBarnatdeposit.ThefinallayoutandtheenvironmentalimpactassessmentwerecompletedbytheendofJanuary2015.TheenvironmentalimpactassessmentisunderreviewbytheMinistryofSustainableDevelopment,EnvironmentandtheFightAgainstClimateChange(Quebec).AnswerstothefirstsetofquestionsposedbytheMinistryweresubmittedinSeptember2015andanswerstothesecondsetofquestionsposedbytheMinistryweresubmittedinJanuary2016.

Mining Methods

MiningattheCanadianMalarticmineisdonebyopenpitmethodusingexcavatorsandtrucks.Inordertomaximizeproductivityandlimitthenumberofunitsoperatinginthepit,largescaleequipmentwasselectedforthemineoperation.Theprimaryloadingtoolsarehydraulicexcavators,withwheelloadersusedasasecondaryloadingtool.Themineproductionschedulewasdevelopedtofeedthemillatanominalrateof55,000tonnesperday.Thecontinuityandconsistencyofthemineralization,coupledwithtightdefinitiondrilling,andconfirmedbysixyearsofminingoperations,demonstratetheamenabilityofthemineralreservesandmineralresourcestotheselectedminingmethod.

ThethroughputattheCanadianMalarticminein2015averaged52,300tonnesperdaycomparedwith51,248tonnesperdayin2014.Theincreasedthroughputin2015waslargelyduetomilloptimization,additionalcrushedorefromtheportablecrusherandmillstability.


Surface Facilities

SurfacefacilitiesattheCanadianMalarticmineincludetheadministration/warehousebuilding,themineoffice/truckshopbuilding,theprocessplantandthecrushingplant.Theprocessingplanthasadailycapacityof55,000tonnesofore.

Oreisprocessedthroughconventionalcyanidation.Oreblastedfromthepitisfirstcrushedbyagyratorycrusherfollowedbysecondarycrushingpriortogrinding.GroundorefeedssuccessivelyintoleachandCIPcircuits.

AZadraelutioncircuitisusedtoextractthegoldfromtheloadedcarbon.Pregnantsolutionisprocessedviaelectrowinningandtheresultingprecipitateissmeltedintogold/silverdorebars.

Milltailsarethickenedanddetoxified,reducingcyanidelevelsbelow20partspermillion.Followingastudysupportingthechange-overoftheexistingCombinox(sulfurdioxide–hydrogenperoxide)cyanidedetoxifyingprocessintoaCaro's(sulfuricacide–hydrogenperoxide)acidprocess,constructionwasinitiatedinthesecondhalfof2015andisexpectedtobecompletedinthesecondquarterof2016.Detoxifiedslurryissubsequentlypumpedtoaconventionaltailingsfacility.


SincetheJune16,2014acquisitionofOsisko,AgnicoEagleandYamanahaveeachhelda50%interestintheCanadianMalarticmine.During2015,AgnicoEagle'sshareoftheCanadianMalarticmine'spayableproductionwas285,809ouncesofgoldand300,454ouncesofsilverfrom9,544,764tonnesoforegrading1.05gramsofgoldpertonneand1.27gramsofsilverpertonne.ThetotalcashcostsperounceofgoldproducedatCanadianMalarticin2015was$596onaby-productbasisandwas$613onaco-productbasisandtheCanadianMalarticprocessingfacilityaveraged52,300tonnesoforeperdayandoperated93.6%ofavailabletime.Goldandsilverrecoveryaveraged88.8%and77.0%,respectively.TheminesitecostspertonneatCanadianMalarticin2015wereC$20.

ThefollowingtablesetsoutthemetalrecoveriesattheCanadianMalarticmineona100%basisin2015.

Head Grade

Overall Metal

RecoveryPayable

Production

Gold 1.05g/t 88.8% 571,617ozSilver 1.27g/t 77.0% 600,908oz

TheCompany's50%shareofannualproductionattheCanadianMalarticminein2016isexpectedtoconsistofapproximately280,000ouncesofgoldand288,000ouncesofsilverfrom9.5milliontonnesoforegrading1.03gramsofgoldpertonneand1.20gramsofsilverpertonne.Thetotalcashcostsperouncein2016areexpectedtobeapproximately$593perounceonaby-productbasis,withestimatedgoldrecoveryof89.3%andsilverrecoveryof77.0%.MinesitecostspertonneofapproximatelyC$23areexpectedin2016.


Since2010,therehavebeen67non-conformanceblastnotices,65non-conformancenoisenotices,19non-conformancenoticesforairquality,6non-conformancenoticesforwaterquality(surfaceandfinaleffluent)and18othernon-conformancenotices.In2015,anactionplanwasdevelopedandimplementedbythePartnershiptomitigatenoise,vibrations,atmosphericemissionsandancillaryissues.Mitigationmeasureswereputinplacetoimprovetheprocessandavoidanynon-conformance.Themine'steamofon-siteenvironmentalexpertscontinuouslymonitorregulatorycomplianceintermsofapprovals,permitsandobservanceofdirectivesandrequirements.

Theoriginaldesignofthewasterockpilewasdevelopedtoaccommodateapproximately326milliontonnesofmechanicallyplacedwasterockrequiringatotalstoragevolumeofapproximately161millioncubicmetres.

Theexistingpolishingpondiscontainedwithinthecurrentauthorizedfootprintofthetailingsmanagementfacility.Thispondwillbeusedasacelltostoretailingsbeginninginmid-2016.InAugust2015,thePartnershipstartedtheconstructionofanewpolishingpondeastofdykeA.ThisnewpolishingpondisexpectedtobeoperationalinApril,2016.Theexistingpolishingpond,convertedintoatailingscell,willbetheeighthcellofthetailingsmanagementfacilitywithanestimatedcapacityof48milliontonnes,adding2.5yearsofoperationtothetailingsmanagementfacilitycapacityforatotalof148milliontonnesand7.5yearsofoperation.Thetotalcapacityofthecurrenttailingsmanagementfacilityisestimatedat198milliontonnes.Theexpansionoftheopenpit,withtheproductionfromtheBarnatpit,willincreasethe


totalamountoftailingsto342milliontonnes,requiringanadditional144milliontonnesintailingsstoragecapacity.ThePartnershipplanstostoretailingsinanextendedtailingsfacilityandintheCanadianMalarticpitattheendofitsoperations.Accordingtotheminingplan,attheendofminelife,50to100milliontonnesoftailingswillbedepositedinthepit.Therestofthetailings,aminimumof59andamaximumof109milliontonnes,willbedepositedintheextendedtailingsfacility.

RegulatoryapprovalfortheproposedtailingsdepositionintheCanadianMalarticpitandtheexpansionofthecurrentlyauthorizedtailingsareaarepartoftheapprovalprocessfortheCanadianMalarticpitextension(Barnatdeposit)subjecttotheenvironmentalimpactassessmentprocessoftheQuebecEnvironment Quality Act .TheenvironmentalimpactassessmenthasbeencompletedandisunderreviewbytheMinistryofSustainableDevelopment,EnvironmentandtheFightAgainstClimateChange(Quebec).GolderAssociatesLtd.isdesigningthetailingsextensioncomponentandispreparingahydrogeologicalstudytodemonstratethattheCanadianMalarticpitwouldprovideahydraulictrapandcontainthetailingswithminimumenvironmentalrisk.DelayintheexpectedtimingofthepermitsrequiredfortheCanadianMalarticpitextensioncouldhaveanegativeimpactontheminingsequenceatCanadianMalartic.

AnannualhydrologicalsitebalanceismaintainedtoprovideayearlyestimateofwatervolumesthatmustbemanagedinthedifferentstructuresofthewatermanagementsystemoftheCanadianMalarticmineduringanaverageclimaticyear(intermsofprecipitation).ResultsofthishydrologicalbalanceindicatethatexcesswaterfromtheSoutheastPondwilleventuallyneedtobereleasedintotheenvironment.Awatertreatmentplantwascommissionedin2015toensurethatthewatertobereleasedtotheenvironmentmeetswaterqualityrequirements.Thiswatertreatmentplantreducestherisksassociatedwithsurfacewatermanagementandaddsflexibilitytothesystem.

Reclamationandclosurecostshavebeenestimatedforrehabilitatingthetailingsfacilityandwastedump,vegetatingthesurroundingarea,dismantlingtheplantandassociatedinfrastructure,andperformingenvironmentalinspectionandmonitoringforaperiodoftenyears.ThereclamationandclosurecostisestimatedtobeC$65.5million.Financialassurancehasbeenprovidedbasedontheclosureplan.


CapitalexpendituresattheCanadianMalarticmineduring2015wereapproximately$43.4million,whichincludedsustainingcapitalexpendituresanddeferredexpense,butexcludedcapitalizeddrilling.Budgeted2016capitalexpendituresattheCanadianMalarticmineare$61million,excludingcapitalizeddrilling.

Development

DevelopmentactivitiesattheCanadianMalarticminein2015primarilyconsistedofstrippingactivities.Developmentactivitiesin2016areexpectedtoincludeadditionalstrippingactivities.


Geology

TheCanadianMalarticpropertystraddlesthesouthernmarginoftheeasternportionoftheAbitibiSubprovince,anArcheangreenstonebeltsituatedinthesoutheasternpartoftheSuperiorProvinceoftheCanadianShield.TheAbitibiSubprovinceislimitedtothenorthbygneissesandplutonsoftheOpaticaSubprovince,andtothesouthbymetasedimentsandintrusiverocksofthePontiacSubprovince.ThecontactbetweenthePontiacSubprovinceandtherocksoftheAbitibigreenstonebeltischaracterizedbyamajorfaultcorridor,theeast-westtrendingLarderLake–CadillacFaultZone("LLCFZ").ThisstructurerunsfromLarderLake,OntariothroughRouyn-Noranda,Cadillac,Malartic,Val-d'OrandLouvicourt,Québec,atwhichpointitistruncatedbytheGrenvilleFront.

TheregionalstratigraphyofthesoutheasternAbitibiareaisdividedintogroupsofalternatingvolcanicandsedimentaryrocks,generallyorientedatN280°–N330°andseparatedbyfaultzones.Themainlithostratigraphicdivisionsinthisregionare,fromsouthtonorth,thePontiacGroupofthePontiacSubprovinceandthePiché,Cadillac,BlakeRiver,KewagamaandMalarticgroupsoftheAbitibiSubprovince.ThevariouslithologicalgroupswithintheAbitibiSubprovincearemetamorphosedtogreenschistfacies.MetamorphicgradeincreasestowardthesouthernlimitoftheAbitibibelt,whererocksofthePichéGroupandthenorthernpartofthePontiacGrouphavebeenmetamorphosedtouppergreenschistfacies.

ThemajorityoftheCanadianMalarticpropertyisunderlainbymetasedimentaryunitsofthePontiacGroup,lyingimmediatelysouthoftheLLCFZ.Thenorth-centralportionofthepropertycoversanapproximately9.5kilometresectionoftheLLCFZcorridorandisunderlainbymafic-ultramaficmetavolcanicrocksofthePichéGroupcutbyporphyriticand


dioriticintrusions.TheCadillacGroupcoversthenorthernpartoftheproperty(northoftheLLCFZ).Itconsistsofgreywackecontaininglensesofconglomerate.

Mineralization

SurfacedrillingbyLacMineralsLtd.inthe1980sdefinedseveralnear-surfacemineralizedzonesnowincludedintheCanadianMalarticdeposit(theF,P,A,WolfeandGilbertzones),allexpressionsofalarger,continuousmineralizedsystemlocatedatdeptharoundthehistoricalundergroundworkingsoftheCanadianMalarticandSladenmines.Inadditiontothese,theWesternPorphyryZoneoccurs1kmnortheastofthemainCanadianMalarticdepositandtheGouldiemineralizedzoneoccursapproximately1.2kmsoutheastofthemainCanadianMalarticdeposit,althoughtherelationshipbetweenthesezonesandthemaindepositispresentlyunknown.

MineralizationintheCanadianMalarticdepositoccursasacontinuousshellof1to5%disseminatedpyriteassociatedwithfinenativegoldandtracesofchalcopyrite,sphaleriteandtellurides.ThegoldresourceismostlyhostedbyalteredclasticsedimentsofthePontiacGroup(70%)overlyinganepizonaldioriticporphyryintrusion.Aportionofthedepositalsooccursintheupperportionsoftheporphyrybody(30%).

TheSouthBarnatdepositislocatedtothenorthandsouthoftheoldSouthBarnatandEastMalarticmineworkings,largelyalongthesouthernedgeoftheLLCFZ.Thedisseminated/stockworkgoldmineralizationatSouthBarnatishostedbothinpotassic-altered,silicifiedgreywackesofthePontiacGroup(southofthefaultcontact)andinpotassic-alteredporphyrydykesandschistose,carbonatizedandbiotiticultramaficrocks(northofthefaultcontact).

SeveralmineralizedzoneshavebeendocumentedwithintheLLCFZ(SouthBarnat,Buckshot,EastMalartic,Jeffrey,Odyssey,EastAmphi,Fourax),allofwhicharegenerallyspatiallyassociatedwithstockworksanddisseminationswithindioriticorfelsicporphyriticintrusions.


GoldwasfirstdiscoveredintheMalarticareain1923bytheGouldieBrothersatwhatisnowdesignatedtheGouldieZone.Duringtheperiodfrom1935to1983,theCanadianMalartic,Barnat/SladenandEastMalarticminesproducedapproximately5.5millionouncesofgoldand1.9millionouncesofsilver,mostlyfromundergroundoperations.

ThecombinedamountofgoldinprovenandprobablemineralreservesattheCanadianMalarticmineattheendof2015was3.86millionounces(110.8milliontonnesoforegrading1.08gramspertonnegold),whichrepresentsadecreaseofapproximately466,000ouncesofgoldascomparedtotheendof2014,afterproducing285,809ouncesofgold(340,000ouncesin-situgoldmined).Thereductioninmineralreserveswasprincipallyassociatedwithoreminedduring2015.Theremainderofthedeclinewasduetoaslightreductioninthepitshellsrelatedtotheincorporationofthe5%netsmelterreturnroyaltypayabletoOsiskoGoldRoyaltiesLtd.,andtheterminationoftheGouldieopenpit.OpenpitmeasuredandindicatedmineralresourcesattheCanadianMalarticminedecreasedby22.7milliontonnesoforein2015to12.8milliontonnesoforegrading1.51gramsofgoldpertonne,duetoadjustingtheapproachtotheout-pitresourcesbyincreasingthecut-offgrade.Thesameapproachresultedinremoving18.2milliontonnesoforefromtheopenpitinferredmineralresourcesatCanadianMalartic,leaving4.5milliontonnesoforegrading1.47gramsofgoldpertonne.AllnumbersshownforCanadianMalarticreflectAgnicoEagle's50%ownershipinthemine.

DiamonddrillingisusedforexplorationontheCanadianMalarticproperty.In2015,noholesweredrilledfordefinition(conversion)drilling,but44holes(35,870metres)wereforexploration.ExpendituresondiamonddrillingattheCanadianMalarticmineduring2015wereapproximately$1.2million(50%basis).

Themainfocusofthe2015explorationprogramwasthePorphyry#12intrusion,hosttotheOdysseyNorthandSouthtargetsidentifiedin2014.Severalholesextendedmineralizationonthefootwall/northcontact(Northzone)andthehangingwall/southcontact(Southzone)ofPorphyry#12.

In2016,thePartnershipexpectstospend$7.7millionon60kilometresofexplorationdrillingattheCanadianMalarticmine.Explorationprogramsareplannedin2016toevaluateopenpitandundergroundtargetsandtofurtherdefinetheextentofmineralizationattheOdysseyzone.

KittilaMine

TheKittilamine,whichcommencedcommercialproductioninMay2009,islocatedinnorthernFinlandapproximately900kilometresnorthofHelsinkiand50kilometresnortheastofthetownofKittila.AtDecember31,2015,theKittilaminewasestimatedtocontainprovenandprobablemineralreservesof4.35millionouncesofgoldcomprisedof28.2million


tonnesoforegrading4.80gramsofgoldpertonne.TheKittilamineisaccessiblebypavedroadfromthevillageofKiistala,whichislocatedonthesouthernportionofthemainclaimblock.ThegolddepositislocatednearthesmallvillageofRouravaara,approximatelytenkilometresnorthofthevillageofKiistala.

ThetotallandholdingssurroundingandincludingtheKittilaminecomprisetwomininglicencesand187tenements.ThetenementsformacontinuousblockaroundtheKittilaandKuotkomininglicences.TheblockhasbeendividedintotheSuurikuusikkoarea(whichincludestheRouravaaraarea),theSuurikuusikkoWestarea,theSuurikuusikkoEastarea,andtheKittilaandKuotkomininglicences.TheKuotkomininglicenceislocatedapproximately15kilometersnorthoftheKittilämine.TheKuotkomininglicenceiscurrentlyintheenvironmentalreviewprocess.

Theboundaryofthemininglicenceisdeterminedbyground-surveyedpoints,whereastheboundariesofthetenementsarenotrequiredtobesurveyed.AllofthetenementsattheKittilamineareregisteredinthenameofAgnicoEagleFinlandOy,anindirect,wholly-ownedsubsidiaryoftheCompany.Theexpirydatesofthetenementsvary,withtheearliestexpirydatebeingMay2016.Tenementsareinitiallyvalidforfouryears,providedexplorationworkintheareaisreportedannuallyandasmallannualfeeispaidtomaintaintitle;extensionsoftitlescanbegrantedfor11additionalyearsuponpaymentofaslightlyhigherfeeandactiveexplorationinthearea.AgnicoEagleFinlandOyalsoholdsthemininglicenceinrespectoftheKittilamine.Themineissubjecttoa2.0%netsmelterreturnroyaltypayabletotheRepublicofFinland.

ThemineislocatedwithintheArcticCircle,buttheclimateismoderatedbytheGulfStreamoffthecoastofNorway,suchthatnorthernFinland'sclimateiscomparabletothatofeasternCanada.Wintertemperaturesrangefromminustentominus30degreesCelsius,whereassummertemperaturesrangefromtendegreesCelsiustothemid-20s.Explorationandminingworkcanbecarriedoutyear-round.Becauseofitsnorthernlatitude,winterdaysareextremelyshortwithabriefperiodof24-hourdarknessaroundthewintersolstice.Conversely,summerdaysareverylongwithabriefperiodof24-hourdaylightinearlysummeraroundthesummersolstice.

LocationMapoftheKittilaMine(asatDecember31,2015)

TheCompanyacquiredits100%,indirectinterestintheKittilaminethroughtheacquisitionoftheSwedishcompanyRiddarhyttanResourcesABinNovember2005.InJune2006,onthebasisofanindependentlyreviewedfeasibilitystudy,theCompanyapprovedconstructionoftheKittilamine.MiningatKittilastartedinitiallyasopenpitmining.OpenpitminingwascompletedinNovember2012andallminingiscurrentlycarriedoutfromtheundergroundviarampaccess.Theinitialundergroundstopewasminedinearly2010.Oreisprocessedina3,000-tonneperdaysurfaceprocessingplantthatwascommissionedinlate2008.LimitedgoldconcentrateproductionstartedinSeptember2008andgolddore


barproductioncommencedinJanuary2009.AdecisiontoincreasethemineproductionwasmadeinFebruary2013andtheprocessingcapacitywasexpandedfrom3,000tonnesperdayto3,750tonnesperday.Theexpansionprojectwascompletedaheadofschedulein2014,andfinalexpansiontie-inswerecompletedduringascheduledmaintenanceshut-downinSeptember.Theramping-upofprocessingcapacitycontinuedtoyear-end,occasionallyreachingover4,000tonnesperday.


SurfacePlanoftheKittilaMine(asatDecember31,2015)

TheorebodiesatKittilawereinitiallyminedfromtwoopenpits,followedbyundergroundoperationstominethedepositsfurtherbeneaththesurface.Smalleradditionalopenpitswillbeusedtomineanyremainingmineralreservesclosetothesurfaceinthefuture.OpenpitminingstartedinMay2008andtheextractedorewasstockpiled.AsofDecember31,2015,atotalof7.7milliontonnesoforehavebeenprocessed,includingorefromtheopenpitsandunderground,0.51milliontonnesoforearecurrentlystockpiledand38.6milliontonnesofwasterockhavebeenexcavated,includingbothopenpitandundergroundexcavation.Workhascontinuedthroughout2015todeveloptheexplorationandRimpiramps,aswellasotherworktoaccesstheundergroundmineralreserves.Totalunderground(lateralandvertical)developmentattheendof2015wasapproximately65,700metres.Undergroundminingcommencedinthefourthquarterof2010and,attheendof2015,atotalof4.83milliontonnesoforehasbeenminedfromtheundergroundportionofthemine.


Mining Methods

AttheKittilamine,theSuurikuusikkoandtheRouravaaraorebodiesarecurrentlyminedbyundergroundminingmethodsandaccesstotheundergroundmineisviaramp.Approximately4,500tonnesoforeperdayarefedtotheconcentrator,exceedingthenominalcapacityof3,750tonnesperday.Theundergroundminingmethodisopenstopingwithdelayedbackfill.Stopesarebetween25and40metreshighandyieldbetween10,000and40,000tonnesoforeperstope.Toensuresufficientoreproductionisavailableinthefuturetosupplythemill,over11,000metresoftunnelswillbedevelopedeachyear.Afterextraction,stopesarefilledwithpastebackfillorcementedbackfilltoenablethesafeextractionoforeinadjacentstopes.Oreistruckedtothesurfacecrusherviatherampaccesssystem.

Surface Facilities

Constructionoftheprocessingplantandassociatedequipmentwascompletedin2008.FacilitiesattheKittilamineincludeofficebuildings,amaintenancefacilityforminingequipment,awarehouse,asecondmaintenanceshop,anoxygenplant,aprocessingplant,apastebackfillplant,atankfarm,acrusher,conveyorhousingsandanorebin.Inaddition,therearesometemporarystructuresforcontractorofficesandworkareas.

TheoreattheKittilamineistreatedbygrinding,flotation,pressureoxidationandCILcircuits.Aftergrinding,oreprocessingconsistsoftwostages.Inthefirststage,oreisenrichedbyflotationand,inthesecondstage,thegoldisextractedbypressureoxidationandCILprocesses.Attheendofthesecondstage,goldisrecoveredfromthecarboninaZadraelutioncircuitandrecoveredfromthesolutionusingelectrowinningandfinallypouredintodorebarsusinganelectricinductionfurnace.

During2015,flotationrecoveriesaveraged93.0%.Recoveriesinthesecondstageoftheprocessin2015averaged83.2%andglobalrecoverieswere84.8%.


In2015,theKittilaminehadpayableproductionof177,374ouncesofgoldfrom1,464,038tonnesoforegrading4.44gramsofgoldpertonne.ThetotalcashcostsperounceofgoldproducedatKittilain2015was$709onaby-productbasisand$710onaco-productbasis.In2015,theKittilaprocessingfacilityaveraged5,156tonnesoforeperdayandoperatedapproximately78%ofavailabletime.Goldrecoveryaveraged84.8%.TheminesitecostspertonneatKittilawere€76in2015.

ThefollowingtablesetsoutthemetalrecoveriesattheKittilaminein2015.

Head Grade

Overall Metal

RecoveryPayable

Production

Gold 4.44g/t 84.8% 177,374oz

In2016,theKittilamineisexpectedtoproduceapproximately200,000ouncesofgoldfrom1.57milliontonnesoforegrading4.7gramsofgoldpertonneatestimatedtotalcashcostsperounceofapproximately$646onaby-productbasis,withestimatedgoldrecoveryof84.5%.Minesitecostspertonneofapproximately€75areexpectedin2016.


AgnicoEagleFinlandOycurrentlyholdsamininglicence,anenvironmentalpermitandoperationalpermitsinrespectoftheKittilamine.Allpermitsnecessarytobeginproductionwerereceivedduring2008.

Theconstructionofthefirstphaseofthetailingsdamwascompletedinthefallof2008.Workonthesecondphasewascompletedin2010andincludedtheexpansionofthetailingsarea.Workonthethirdphasebeganin2013andincludesworktoheightenthedam.Workonthethirdphaseisexpectedtocontinueforseveralyears.

OnSeptember14,2015,duringroutineinspectionsofthedam,waterseepagewasdiscoveredfromaholdingpond(NP3).TheseepagewasobservedatthetoeoftheNP3damandhassincebeenidentifiedtobeoccurringthroughthelineratthebottomoftheholdingpond.Theoriginalflowrateoftheseepagewasestimatedtobeapproximately350cubicmetersperhour(m3/hr),however,theflowratehasbeenreducedtoapproximately250m3/hrbythedepositionofmoraineontheaffectedpondbottom.Within36hoursoffirstdetectingtheseepage,dischargeofseepagewatertothe


environmenthadstoppedasallwaterfromtheuncontrolleddischargewascollectedandpumpedbackintheholdingpondorthewatermanagementsystem.Theseepagewaterwasclearandwaterqualitywaswithintheparametersofthepermit.Mitigationmeasures,includingwatertransfertoarecentlyconstructedwaterreservoirandmorainedepositioninthepondintheareaoftheseepage,followedbytailingsdepositiontofurthersealthearea,wereappliedthroughoutthefallandweresuccessfulinreducingtheseepagetonearnormalseepagelevelsforsuchinfrastructure.Seepageisbeingmonitoredandpumpedbacktothepondonacontinuousbasis.Adetailedactionplanforapermanentsolutionwasdevelopedbyateamofinternalandexternalexpertsandthisplaniscurrentlybeingimplemented.

Waterfromdewateringthemineandwaterusedinthemineandmilliscollectedandtreatedbysedimentation.EmissionsandenvironmentalimpactaremonitoredinaccordancewiththecomprehensivemonitoringprogramthathasbeenapprovedbytheFinnishenvironmentalauthorities.Workonenhancingthescrubbingofmillgaseshasresultedinadesigntorecoverheatlossanduseittoheatbuildings,andthisworkiscontinuing.Financialassuranceisprovidedtotheenvironmentalauthoritiesonanannualbasisintheamountprescribedbytheenvironmentalpermit.

TheenvironmentalpermitrenewalwasreceivedinJuly2013.ThisrenewalcontainsadditionaleffluentcriteriaandtheCompanyhasappealedthetimingofcompliancewithsuchcriteriatoallowforstudiesanddesigntotakeplacefornewwatertreatmentasrequired.AdecisionbytheAdministrativeCourtreviewingtheappealwasreceivedinthefirstquarterof2015grantingtheCompany'sappealinpart.TheCompanyhasalsorespondedtoanotherappeallodgedbyathirdparty.Followingwatertreatmenttestsandpiloting,theCompanyiscurrentlydesigningawatertreatmentsystemtoensurecompliancewiththerequirementsofthenewpermit.Thiswatertreatmentsystemshouldbeconstructedandcommissionedin2016.ThefinaldecisionoftheAdministrativeCourtonthenewpermitisexpectedinmid-2016.


CapitalexpendituresattheKittilamineduring2015totaledapproximately$56.4million,whichincludedmillexpansionconstruction,millmodification,undergrounddevelopmentandsustainingcapitalcosts,butexcludescapitalizeddrilling.

TheCompanyexpectscapitalexpendituresduring2016attheKittilaminetobeapproximately$66million,excludingcapitalizeddrilling.

Development

In2015,undergrounddevelopmentcontinuedinboththeSuurikuusikkoandRouravaaraminingareas.ThedrivingofarampfromsurfacetowardsthenewRimpizonewasalsoinitiatedin2014.Atotalof13,641metresoframpandsublevelaccessdevelopmentwerecompletedduringtheyear.Atotalof171,337tonnesoforefromdevelopmentand1,313,319tonnesofstopeorewereminedin2015.TheCompanyexpectstocompleteapproximately13,875metresoflateraldevelopmentand1,620metresofverticaldevelopmentduring2016.


Geology

TheKittilamineissituatedwithintheKittilaGreenstonebelt,partoftheLaplandGreenstonebeltintheProterozoic-ageSvecofenniangeologicprovince.TheappearanceandgeologyoftheareaissimilartothatoftheAbitibiregionoftheCanadianShield.InnorthernFinland,thebedrockistypicallycoveredbyathinbutuniformblanketofunconsolidatedglacialtill.Bedrockexposuresarescarceandirregularlydistributed.

ThemineareaisunderlainbymaficvolcanicandsedimentaryrocksmetamorphosedtogreenschistassemblagesandassignedtotheKittilagroup.Themajorrockunitstrendnorthtonorth-northeastandarenear-vertical.Thevolcanicsarefurthersub-dividedintoiron-richtholeiiticbasaltslocatedtothewestandmagnesium-richtholeiiticbasalt,coarsevolcaniclasticunits,graphiticschistandminorchemicalsedimentaryrockslocatedtotheeast.Thecontactbetweenthesetworockunitsconsistsofatransitionalzone(the"PorkonenFormation")varyingbetween50and200metresinthickness.Thiszoneisstronglysheared,brecciatedandcharacterizedbyintensehydrothermalalterationandgoldmineralization,featuresconsistentwithmajorbrittle-ductiledeformationzones.Thezoneispartofamajornorth-northeast-orientedshearzone(the"SuurikuusikkoTrend").

Mineralization

ThePorkonenFormationhoststheKittilagolddeposit,whichcontainsmultiplemineralizedzonesstretchingoverastrikelengthofmorethan25kilometres.MostoftheworkattheKittilaminehasbeenfocusedonthe4.5-kilometrestretchthathoststheknowngoldinmineralreservesandmineralresources.Fromnorthtosouth,thezonesareRimminvuoma


("Rimpi-S"),thedeepextensionofRimminvuoma("RimpiDeep"),NorthRouravaara("Roura-N"),CentralRouravaara("Roura-C"),depthextensionofRouravaaraandSuurikuusikko("Suuri/RouraDeep"),Suurikuusikko("Suuri"),EtelaandKetola.TheSuuriandSuuri/RouraDeepzonesincludeseveralparallelsub-zonesthathavepreviouslybeenreferredtoasMainEast,MainCentralandMainWest.TheSuurizonehostsapproximately17%ofthecurrentprobablegoldreserveestimateonacontained-goldbasis,whileSuuriDeephasapproximately21%,Roura-Capproximately5%,RouraDeepapproximately27%,Roura-Napproximately0.1%,RimpiDeepapproximately23%,Rimpi-Sapproximately6%,Ketolaapproximately1%andEtelaapproximately0.1%.

Goldmineralizationinthesezonesisassociatedwithintensehydrothermalalteration(carbonate-albite-sulphide),andisalmostexclusivelyrefractory,lockedinsidefine-grainedsulphideminerals:arsenopyrite(approximately73%)orpyrite(approximately23%).Therestisfreegold,whichismanifestedasextremelysmallgrainsofgoldinpyrite.


In2015,provenandprobablegoldreservesdecreasedbyapproximately171,000ouncesto4.35millionouncesofgold(28.2milliontonnesoforegrading4.80gramspertonne),afterproducing177,374ouncesofgold(209,000ouncesin-situgoldmined).Thisdecreasewasprimarilyduetooremilledin2015,partiallyoffsetbysuccessfulconversionofmineralresourcestomineralreserves.MeasuredandindicatedmineralresourcesatDecember31,2015increasedby1.8milliontonnesfrom2014to15.9milliontonnesoforegrading3.02gramsofgoldpertonne.Inferredmineralresourcesincreasedby2.9milliontonnesfrom2014to11.8milliontonnesoforegrading4.64gramsofgoldpertonneduetosuccessfulexplorationdrillingintheRouraandRimpiDeepzones.ThisincludesinitialinferredmineralresourcesintheSisarZone,whichwasdiscoveredin2015.

DiamonddrillingisusedforexplorationontheKittilaproperty.In2015,mostoftheworkonthemininglicenceareafocusedontheRouraandRimpiareas.From1987throughtheendof2015,atotalof4,034drillholes,totaling835,029metres,havebeencompletedontheproperty.Atotalof604drillholeswerecompletedin2015foralengthof59,179metres.Ofthesedrillholes,499holes(33,577metres)werefordelineationdrilling,29holes(4,517metres)wereforconversiondrillingand34holes(19,039metres)wererelatedtomineexploration.Totalexpendituresfordiamonddrillingin2015were$6.9million,including$0.4millionfordefinition(conversion)drillingand$4.3millionforexploration.

In2015,atotalof56drillholes,totaling7,304metresweredrilledontheKuotkomininglicencearea.Ofthesedrillholes,16holes(1,354metres)wereforconversiondrillingand40holes(5,950metres)wereforexplorationdrilling.TotalexpendituresforthedrillingcarriedoutintheKuotkoareain2015were$0.7million,including$0.2millionfordefinition(conversion)drillingand$0.5millionforexploration.Attheendof2015,theKuotkodepositcontainedinferredmineralresourcesof1.8milliontonnesoforegrading2.9gramsofgoldpertonne.

OutsideoftheKittilaandKuotkomininglicenceareas,systematicdiamonddrillingandtarget-focusedgroundgeophysicscontinuedalongtheSuurikuusikkoTrend,andanumberofnewtargetsweretestedbydiamonddrillingin2015.Atotalof24diamonddrillholestotaling6,031metresweredrilledonexplorationtargetsoutsideofthemininglicenceareain2015,atacostof$2.5million.

The2016explorationbudgetfortheKittilamineisapproximately$8.1million($7.1millionfor36,000metresofminesiteexplorationdrillingand$0.9millionfor7,900metresofresourceconversiondrilling).ThisdrillingisplannedtofurtherexploretheKittilagoldreserveandresourcepotentialandtoevaluatethepotentialtodeveloptherecentlydiscoveredSisarZoneasanewmininghorizonatKittila.Inaddition,$1.0millionofexplorationexpenditures,including6,600metresofdiamonddrilling,isplannedin2016forfurtherexplorationontheKuotkoarea.Outsideofthemininglicenceareas,$2.5millionofexplorationexpenditures,including4,700metresofdiamonddrilling,isplannedin2016forexplorationalongtheSuurikuusikko,KapsaandHanhimaaTrends.

MeadowbankMine

TheMeadowbankmine,whichachievedcommercialproductioninMarch2010,islocatedintheThirdPortageLakeareaintheKivalliqDistrictofNunavutinnorthernCanada,approximately70kilometresnorthofBakerLake.AtDecember31,2015,theMeadowbankminewasestimatedtocontainprovenandprobablemineralreservesof0.94millionouncesofgoldcomprisedof10.8milliontonnesoforegradinganaverageof2.72gramsofgoldpertonne.TheCompanyacquiredits100%interestintheMeadowbankminein2007astheresultoftheacquisitionofCumberlandResourcesLtd.


LocationMapoftheMeadowbankMine(asatDecember31,2015)


TheMeadowbankmineisheldundertenCrownminingleases,fourexplorationconcessionsand40Crownmineralclaims.TheCrownminingleases,whichcoverthePortage,GooseandGooseSouthdeposits,areadministeredunderfederallegislation.TheCrownminingleases,whichhaverenewableten-yearterms,havenoannualworkcommitmentsbutaresubjecttoannualrentfeesthatvaryaccordingtotheirrenewaldate.TheCrownminingleasesexpireineither2016or2019.TheproductionleasewiththeKivalliqInuitAssociation("KIA")isasurfaceleaseandrequiresthepaymentofC$158,865annually.Productionfromsubsurfaceleaseareasissubjecttoaroyaltyofupto14%oftheadjustednetprofits,asdefinedintheNorthwest Territories and Nunavut Mining Regulations .InordertoconductexplorationontheInuit-ownedlandsatMeadowbank,theCompanymustreceiveapprovalforanannualworkproposalfromtheKIA,thebodythatholdsthesurfacerightsintheKivalliqDistrictandadministerslanduseintheregionthroughvariousboards.TheNunavutWaterBoard(the"NWB"),onesuchboard,providedtherecommendationtotheDepartmentofAboriginalAffairsandNorthernDevelopmentCanadatogranttheMeadowbankmine'sconstructionandoperatinglicencesinJuly2008.TheCompanyhasobtainedalloftheapprovalsandlicencesrequiredtobuildandoperatetheMeadowbankmine.

ThefourMeadowbankexplorationconcessionsaregrantedbyNunavutTunngavikInc.("NTI"),thecorporationresponsibleforadministeringsubsurfacemineralrightsonInuit-ownedlandsinNunavut.In2016,explorationconcessionscoveringtheVaultdepositatMeadowbankwillrequireannualrentalfeesofapproximatelyC$57,000.Duringtheexplorationphase,theconcessionscanbeheldforupto20yearsandtheconcessionscanbeconvertedintoproductionleaseswithannualfeesofC$1perhectare,withnoannualworkcommitments.

In2012,theCompanysignedaproductionleasewithNTIcoveringtheextractionandprocessingofgoldfromtheVaultdeposit.ThisleaseauthorizestheCompanytomineandprocessgoldfromtheVaultdepositandsetsinplaceroyaltypaymentsthatareequivalenttothosebeingpaidbytheCompanyatthePortageandGoosepits.Productionfromtheconcessionsissubjecttoa12%netprofitsinterestroyaltyfromwhichannualdeductionsarelimitedto85%ofthegrossrevenue.

The40Crownmineralclaimsaresubjecttolandfeesandworkcommitments.Landfeesarepayableonlywhenworkisfiled.Themostrecentfilingwasin2012,whenapproximately$7,254inlandfeeswerepaidand$4,426,941inassessmentworkwassubmitted.

TheMeadowbankareaisconsideredtohaveanaridarcticclimatewithtemperaturesrangingfrom5tominus40degreesCelsiusinthewinter(fromOctobertoMay)andfromminus5to25degreesCelsiusthroughoutthesummer(fromJunetoSeptember).Surfacegeologicalworkcanbecarriedoutfrommid-Maytomid-October,whilemining,millingandexplorationdrillingcantakeplacethroughouttheyear,thoughoutdoorworkcanbehamperedinDecemberandJanuarybythecoldanddarkness.

TheMeadowbankmineisaccessiblefromBakerLake,located70kilometrestothesouth,overa110-kilometreall-weatherroadcompletedinMarch2008.BakerLakeprovides2.5monthsofsummershippingaccessviaHudsonBayandyear-roundairportfacilities.TheMeadowbankminealsohasa1,752-metrelonggravelairstrip,permittingaccessbyair.Fuel,equipment,bulkmaterialsandsuppliesareshippedbybargeandshipfromMontreal,Quebec(orHudsonBayportfacilities)intoBakerLakeduringthesummerportaccessperiodthatstartsattheendofJulyineachyear.Fuelandsuppliesaretransportedyear-roundtothesitefromBakerLakebyconventionaltractortrailerunits.Scheduledandcharteredflightsprovidetransportationforpersonnelandaircargo.



SurfacePlanoftheMeadowbankMine(asatDecember31,2015)

SurfacePlanoftheVaultDeposit(asatDecember31,2015)


Meadowbankhasthreemajordepositsthathavesufficientdrillingdefinitiontosustainmineralreserves:Portage,GooseandVault.TheGoosepitwasdepletedinApril2015.TheareasurroundingtheVaultpithastwosmallerareasthatarebeingdevelopedasfuturepits:thePhaserandBBPhaserpits.Thesepitsareexpectedtobeginoperationattheendof2017.AllrequiredaggregatesusedintheminingprocessareproducedfromwastematerialtakenfromthePortageandVaultpits.In2008,adewateringdykewasconstructedinordertoaccessthenorthhalfofthePortagepitinpreparationforproductionin2010.ConstructionoftheBay-Goosedyke,amajordewateringdykerequiredtoaccessthesouthernportionofthePortageandtheGoosepits,commencedin2009andwascompletedin2011.Threetailingsimpoundmentdykes:SaddleDam1,SaddleDam2andStormwaterDyke,werebuiltin2009and2010.ThefinalelevationofStormwaterdykewascompletedin2014.Constructionofthemaintailingsimpoundmentdyke,CentralDyke,beganin2012.AdditionalphasesofconstructionontheCentralDykeareexpectedtocontinuethroughouttheminelife.Constructionoftheeight-kilometrelongaccessroadtotheVaultpitbeganin2012andwascompletedin2013.

Mining Methods

MiningattheMeadowbankmineisdonebyopenpitmethodusingexcavatorsandtrucks.Theoreisextractedconventionallyusingdrillingandblasting,thenhauledbytruckstoaprimarygyratorycrusheradjacenttothemill.Themarginal-gradematerial(materialgradingunderthecut-offgradeatagoldpriceof$1,100perounce,butwhichhasthepotentialtoincreasethemineralreservesattheendoftheminelifeifthethencurrentmetalpricesmakesitsprocessingeconomical)isstockpiledseparately.Also,stockpilesoflow-gradematerialcurrentlylowerthanthemillfeedgradehavebeencreated.Themajorityofthislow-gradematerialwasprocessedin2014.Theremainderwillbeprocessedattheendoftheminelife.Wasterockishauledtooneofthreewastestoragesareasontheproperty,usedfordykeconstructionmaterialorbackfilledintotheminedoutarea.

MiningfirstcommencedinthePortagepitin2010andintheGoosepitinMarch2012,andcommercialproductionattheVaultpitwasachievedinApril2014.MiningoperationsattheGoosepitceasedin2015.MiningoperationsattheVaultpitandPortagepitareexpectedtoceasein2018.

Surface Facilities

Sitefacilitiesincludeamillbuilding,amechanicalshop,apowerhousebuilding,anassaylabandaheavyvehiclemaintenanceshop.Astructurecomprisedoftwoseparatecrushersflankthemainprocesscomplex.Powerissuppliedbya26.4-megawattdieselelectricpowergenerationplantwithheatrecoveryandanonsitefuelstorage(5.6millionlitres)anddistributionsystem.Themill-service-powercomplexisconnectedtotheaccommodationscomplexbyenclosedcorridors.InJanuary2012,theCompanyidentifiednaturallyoccurringasbestosfibresindustsamplestakenfromthesecondarycrusherbuildingattheMeadowbankmineandsubsequentlyfoundsmallconcentrationsoffibresintheorecomingfromcertainareasoftheopenpitmines.TheCompanyhasinstitutedadditionalmonitoringandanasbestosmanagementprogramatthesite.

TheaccommodationscomplexattheMeadowbankmineconsistsofapermanentcampandatemporarycamptoaccommodateadditionalworkers.Thecampissupportedbyasewagetreatment,solidwastedisposalandpotablewaterplant.In2008,theexplorationgroupwasrelocatedeightkilometressouthoftheminesitelocationtoaseparatecampwithan80-personcapacity.

FacilitiesconstructedatBakerLakeincludeabargelandingsitelocatedthreekilometreseastofthecommunityandastoragecompound.Afuelstorageanddistributioncomplexwithcapacityfor60-millionlitresofdieselfueland2-millionlitresofjetfuelislocatednexttothebargelandingfacility.

In2013,newfacilitieswerebuiltneartheVaultdeposit,whichislocatedapproximatelyeightkilometresfromtheminecomplex.Thesefacilitiesincludeaheatedshelterforemployees,astoragearea,afuelfarm,anelectricalpowergenerationplantandawatertreatmentplant.

Theprocessdesignisbasedonaconventionalgoldplantflowsheetconsistingoftwo-stagecrushing,grinding,gravityconcentration,cyanideleachingandgoldrecoveryinaCIPcircuit.Themillwasdesignedtooperateyear-round,withanannualdesigncapacityof3.1milliontonnes(8,500tonnesperday).Theadditionofasecondarycrusherinearlysummer2011increasedtheoverallprocessedtonnescapacityinthemillto3.6milliontonnesperyear(9,840tonnesperday).SincetheinstallationofthepermanentsecondarycrusherinJune2011,theplanthasconsistentlyexceeded8,500tonnesperday.Basedonprojectionsfrommetallurgicaltestswork,theoverallgoldrecoveryisprojectedtobeapproximately91.2%forthelife-of-mine,withapproximately18%goldrecoveredfromthegravitycircuit.


Therun-of-mineoreistransportedtothecrusherusingoff-roadtrucks.Theoreisdumpedintothegyratorycrusherorintostockpilesdesignatedbyore-type.Thefeedfromtheprimarycrusherisconveyedtotheconecrusherinclosedcircuitwithavibratingscreen.Thecrushedoreisdeliveredtothecoarseorestockpileandorefromthestockpileisconveyedtothemill.ThegrindingcircuitiscomprisedofaprimarySAGmilloperatedinopencircuitandasecondaryballmilloperatedinclosedcircuitwithcyclones.Aportionofthecycloneunderflowstreamissenttotheconcentrator,whichseparatestheheavymineralsfromtheore.Thegrindingcircuitincorporatesagravityprocesstorecoverfreegoldandthefreegoldconcentrateisleachedinanintensivecyanideleach-directelectrowinningrecoveryprocess.

Thecycloneoverflowissenttothegrindingthickener.Theclarifiedoverflowisrecycledtothegrindingcircuitandthickenedunderflowispumpedtoapre-aerationandleachcircuit.Thecyanidecircuitconsistsofseventanks,providingapproximately42hoursofretentiontime.TheleachedslurryflowstoatrainofsixCIPtanks.Goldinthesolutionflowingfromtheleachingcircuitisadsorbedintotheactivatedcarbon.GoldisrecoveredfromthecarboninaZadraelutioncircuitandisrecoveredfromthesolutionusinganelectrowinningrecoveryprocess.Thegoldsludgeisthenpouredintodorebarsusinganelectricinductionfurnace.

TheCIPtailingsaretreatedforthedestructionofcyanideusingthestandardsulphur-dioxide-airprocess.Thedetoxifiedtailingsarethenpumpedtothepermanenttailingsfacility.Thetailingsstorageisdesignedforzerodischarge,withallprocesswaterbeingreclaimedforre-useinthemilltominimizewaterrequirements.


During2015,theMeadowbankminehadpayableproductionof381,804ouncesofgoldfrom4,032,851tonnesoforegrading3.16gramsofgoldpertonne.ThetotalcashcostsperounceofgoldproducedatMeadowbankin2015was$613onaby-productbasisand$623onaco-productbasis.In2015,theMeadowbankprocessingfacilityaveraged11,049tonnesoforeperdayandoperated94.96%ofavailabletimeandgoldrecoveryaveraged93.10%.TheminesitecostspertonneatMeadowbankwereC$70in2015.

ThefollowingtablesetsoutthemetalrecoveriesattheMeadowbankminein2015.Millprocessingexceededextractionfromtheminein2015;10,944tonnescamefromthemarginalstockpileand13,607tonnesfromthelow-gradestockpile.

Head Grade

Overall Metal

RecoveryPayable

Production

Gold 3.16g/t 93.10% 381,804oz

Goldproductionduring2016atMeadowbankisexpectedtobeapproximately305,000ouncesfrom3.9milliontonnesoforegrading2.73gramsofgoldpertonneatestimatedtotalcashcostsperounceofapproximately$750onaby-productbasis,withestimatedgoldrecoveryof90.0%.MinesitecostspertonneofapproximatelyC$77areexpectedin2016.

Environmental Matters (including Inuit Impact and Benefit Agreement), Permitting and Social Matters

ThedevelopmentoftheMeadowbankminewassubjecttoanextensiveenvironmentalreviewprocessundertheNunavutLandClaimsAgreement(the"NLCA")administeredbytheNunavutImpactReviewBoard(the"NIRB").OnDecember30,2006,apredecessortotheCompanyreceivedtheProjectCertificatefromtheNIRB,whichincludedthetermsandconditionstoensuretheenvironmentalintegrityofthedevelopmentprocess.InJuly2008,theCompanyreceivedawaterlicencefromtheNWBforconstructionandoperationoftheminesubjecttoadditionaltermsandconditions.BothauthorizationswereapprovedbythethenMinisterofAboriginalAffairsandNorthernDevelopmentCanada.Thiswaterlicencewasrenewedin2015foraperiodoftenyears.

InFebruary2007,apredecessortotheCompanyandtheNunavutgovernmentsignedaDevelopmentPartnershipAgreement(the"DPA")withrespecttotheMeadowbankmine.TheDPAprovidesaframeworkforstakeholders,includingthefederalandmunicipalgovernmentsandtheKIA,tomaximizethelong-termsocio-economicbenefitsoftheMeadowbankminetoNunavut.

AnInuitImpactandBenefitAgreementfortheMeadowbankmine(the"MeadowbankIIBA")wassignedwiththeKIAinMarch2006.ThisagreementwasrenegotiatedandanamendedMeadowbankIIBAwassignedonOctober18,2011.TheMeadowbankIIBAensuresthatlocalemployment,trainingandbusinessopportunitiesarisingfromallphasesofthe


projectareaccessibletotheKivalliqInuit.TheMeadowbankIIBAalsooutlinesthespecialconsiderationsandcompensationthatmustbeprovidedtotheInuitregardingtraditional,socialandculturalmatters.

InJuly2008,theCompanysignedaproductionleasefortheconstructionandtheoperationofthemine,themillandallrelatedactivities.ThisproductionleasewasamendedonMay2,2013toexpandthesurfaceareagrantedunderthelease.InApril2008,theCompanyandtheKIAsignedawatercompensationagreementfortheMeadowbankmineaddressingInuitrightsundertheLandClaimsAgreementrespectingcompensationforwateruseandwaterimpactsassociatedwiththemine.

AseriesoffourdykeshavebeenbuilttoisolatetheminingactivitiesatthePortageandGoosedepositsfromneighbouringlakes.Anadditionaldykewasbuiltin2013toisolatetheminingactivitiesattheVaultdeposit.WasterockfromthePortage,GooseandVaultpitsisprimarilystoredinthePortageandVaultrockstoragefacilities,andaportionofthewasteisplacedinthePortagePit.Thecontrolstrategyforwasterockstorageincludesfreezecontrolofthewasterockthroughpermafrostencapsulationandcappingwithaninsulatingconvectivelayerofneutralizingrock(ultramaficandnon-acidgeneratingvolcanicrocks).TheVaultrockstoragefacilitydoesnotrequireaninsulatingconvectivelayerduetothenon-acidgeneratingnatureoftherockinthatarea.WasterockdepositedinthePortagepitwillbecoveredwithwaterduringtheclosurephaseofthepitwhichwillpreventanyacidgeneration.Becausethesiteisunderlainbygreaterthan400metresofpermafrost,thewasterockbelowthecappinglayerisexpectedtofreeze,resultinginlow(ifany)ratesofacidrockdrainagegenerationinthelongterm.

TailingsarestoredinthedewateredportionoftheSecondPortageLake.Thetailingsaredepositedontailingsbeacheswithinatwo-celltailingsstoragefacilityisolatedbythecentraldykeandaseriesoffivesaddledams.Areclamationpondislocatedwithinthetailingsstoragefacility.Depositionoftailingsbeganinthesouthcellinthefourthquarterof2014.TailingsdepositionwascompletedintheNorthCellin2015andreclamationcappinghascommenced.Thecontrolstrategytominimizewaterinfiltrationintothetailingsstoragefacilityandthemigrationofconstituentsoutofthefacilityincludesfreezecontrolofthetailingsthroughpermafrostencapsulationandthroughcomprehensive,engineereddykeliners.Aminimumtwo-metrethickdrycoverofacidneutralizingultramaficrockbackfillwillbeplacedoverthetailingsasaninsulatingconvectivelayertoconfinethepermafrostactivelayerwithinrelativelyinerttailingsmaterials.

Thewatermanagementobjectivefortheprojectistominimizethepotentialimpactonthequalityofsurfacewaterandgroundwaterresourcesatthesite.Diversionditcheswereconstructedin2012todivertcleanrunoffwaterawayfromareasaffectedbythemineorminingactivities.Followingafieldinvestigationin2014,acontactwaterinterceptiontrenchwasconstructedtocollectseepagewaterdowngradientfromthemillpriortoenteringintothenearbylake.Allcontactwateroriginatingfromtheminesiteormillisintercepted,collected,conveyedtothetailingsstoragefacilityforreuseinprocess.ThereisnodischargeofcontactwaterfromtheminesiteorthePortagepitareatooffsitereceivingwaterbodies.AllcontactwatergeneratedattheVaultpitarea,includingtheVaultWasteRockStorageFacility,isconveyedtotheVaultAttenuationPondanddischargedtonearbyWallyLake.Thereistreatmentforremovalofsolids(ifneeded)priortoreleasetoWallyLake.

Aninterimclosureandreclamationplanwassubmittedin2014asarequirementofpartoftheNWBTypeAwaterlicenceandfinancialassurancewasprovidedandupdatedinJuly2015aspartoftheWaterLicencerenewalprocess.In2013,theCompanyappliedtotheNWBforanincreaseinfreshwaterconsumptionandreceivedtheamendmenttotheTypeALicenceonJuly23,2014.In2015,totalfreshwaterusebytheMeadowbankminetotaled811,807cubicmetres,wellbelowtheapprovedlimitof2,350,000cubicmetresandthelowesttotalamountoffreshwaterusedsincethebeginningoftheminingoperationsin2010.

In2015,anamendmenttotheprojectcertificatewasrequestedfortheminingofthePhaserpit,asatellitepitintheVaultpitarea.Theamendmentandapprovalprocesswillcontinuein2016.AnamendmenttothepermitfromtheDepartmentofFisheriesandOceansCanadaisalsounderwayforthissatellitepit.

InNovember2013,MeadowbankreceivedacompliancedirectionandiscurrentlyunderinvestigationbyEnvironmentCanadaandAboriginalAffairsandNorthernDevelopmentCanadainrelationtoaseepageincidentthatwasidentifiedduringtheirJuly2013on-siteinspection.Monitoringdatain2014indicatedthatthe2013seepageeventdidnotaffectthewaterqualityofthedownstreampondsandSecondPortageLake.EnvironmentCanadachargedtheCompanywithtwoinfractionsundertheFisheries Act .Thehearinginrelationtothesechargesisexpectedin2016.


Capital Expenditures/Development

In2015,theCompanyincurredapproximately$65.2millionincapitalexpendituresattheMeadowbankmine,including$36.7milliononVaultandPortagepitdeferredstrippingand$28.5milliononcapitalandequipment,butexcludingcapitalizeddrilling.

In2016,atotalof$53millionhasbeenbudgetedtobespentattheMeadowbankmine,excludingcapitalizeddrilling.


Geology

TheMeadowbankminecomprisesanumberofArchean-agegolddepositshostedwithinpolydeformedvolcanicandsedimentaryrocksoftheWoodburnLakeGroup,partoftheWesternChurchillsupergroupinnorthernCanada.

Threemineablegolddeposits,Goose,PortageandVault,havebeendiscoveredalongthe25-kilometrelongMeadowbankgoldtrend,andthePDFdeposit(afourthdeposit)hasbeenoutlinedonthenortheastgoldtrend.Theseknowngoldresourcesarewithin225metresofthesurface,makingthedepositsattractiveforopenpitmining.Inaddition,theAmaruqproperty,located50kilometresnorthwestoftheMeadowbankmine,isbeingconsideredasapossiblesatelliteoperationtotheMeadowbankmine.

Mineralization

ThepredominantgoldmineralizationfoundinthePortageandGoosedepositsisassociatedwithironsulphides,mainlypyriteandpyrrhotite,whichoccurasareplacementofmagnetiteintheoxidefaciesironformationhostrock.Toalesserextent,pyriteandchalcopyritemaybefoundand,onrareoccasions,arsenopyritemaybeassociatedwiththeothersulphides.Goldismainlyobservedinnativeform(electrum),occurringinisolatedspecksorasplatingaroundsulphidegrains.Theorezonesaretypicallysixtosevenmetreswide,followingthecontactsbetweentheironformationunitsandthesurroundinghostrock.Zonesextenduptoseveralhundredmetresalongstrikeandatdepth.Thesulphidesprimarilyoccurasreplacementoftheprimarymagnetitelayers,aswellasnarrowstringersorbandsofdisseminatedsulphidesthatalmostalwayscrosscutthemainfoliationand/orbeddingwhichwouldimplyanepigeneticmodeofemplacement.Thepercentageofsulphidesisquitevariableandmayrangefromtracetosemi-massiveamountsoverseveralcentimetrestoseveralmetresinlength.Thehighergoldgradesandtheoccasionaloccurrenceofvisiblegoldarealmostalwaysassociatedwithgreaterthan20%sulphidecontent.

Themainmineralizedbandedironformationunitisboundedbyanultramaficunittothewestwhichlocallyoccursinterlayeredwiththebandedironformationandtotheeastbyanintermediatetofelsicmetavolcaniclasticunit.

IntheVaultdeposit,pyriteistheprincipalore-bearingsulphide.Thedisseminatedsulphidesoccuralongshearedhorizonsthathavebeensericitizedandsilicified.Thesezonesareseveralmetreswideandmaycontinueforhundredsofmetresalongstrikeanddowndip.

Threeofthefourknowngolddepositshavebeenorarebeingmined.TheGooseandPortagedepositsarehostedwithinhighlydeformed,magnetite-richironformationrocks,whileintermediatevolcanicrockassemblageshostthemajorityofthemineralizationatthemorenortherlyVaultdeposit.Thefourthdeposit,PDF,showsthesamecharacteristicsasVault,thoughitisnotcurrentlyanticipatedtobeamineabledeposit.

Definedovera1.85-kilometrestrikelengthandacrosslateralextentsrangingfrom100to230metres,thegeometryofthePortagedepositconsistsofgeneralnorth-northweststrikingorezonesthatarehighlyfolded.Themineralizationinthelowerlimbofthefoldistypicallysixtoeightmetresintruethickness,reachingupto20metresinthehingearea.

TheGoosedepositislocatedjustsouthofthePortagedepositandisalsoassociatedwithironformationbutexhibitsdifferentgeometry,withanorth-southtrendandasteepwesterlydip.Mineralizedzonestypicallyoccurasasingleunitnearsurface,splayingintoseverallimbsatdepth.Thedepositiscurrentlydefinedovera750-metrestrikelengthanddownto500metresatdepth(mainlyinthesouthernend),withtruethicknessesofthreeto12metres(reachingupto20metreslocally).TheGooseundergroundresource(100to500metresatdepth)extends700metrestothesouthoftheGoosepit.TheorezonesshowthesamecharacteristicsastheGoosepit,whichistwotofivemainzonessub-parallelandundulating.Theaveragethicknessrarelyexceedsthreetofivemetres.

TheVaultdepositislocatedsevenkilometresnortheastofthePortageandGoosedeposits.Itisplanarandshallow-dippingwithadefinedstrikeof1,100metres.Thedeposithasbeendisturbedbytwosetsofnormalfaultsstrikingeast-westandnorth-southanddippingmoderatelytothesoutheastandsteeplytotheeast,respectively.Themainlenshasanaverage


truethicknessofeightto12metres,reachingashighas18metreslocally.Thehangingwalllensesaretypicallythreetofivemetres,anduptosevenmetres,intruethickness.


ExplorationeffortsontheMeadowbankpropertyhavebeenextensivesince1985,includinggeophysics,prospecting,tillsamplinganddrilling,mainlybydiamonddrillbutalsoreversecirculation.From1985untilAgnicoEagleacquiredthepropertyin2007,126,796metresweredrilledin916diamondandreversecirculationdrillholesontheproperty.In2005,CumberlandResources(thepreviousowner)estimatedmineralresourcesinthePortage,GooseandVaultdepositscombinedasfollows:measuredandindicatedmineralresourcesof23.3milliontonnesoforegrading4.40gramspertonneofgold(containing3.3millionouncesofgold)andinferredmineralresourcesof3.5milliontonnesoforegrading4.20gramspertonneofgold(containing0.5millionouncesofgold).

In2015,theamountofgoldinprovenandprobablemineralreservesdecreasedbyapproximately225,000ouncesto943,000ouncesofgold(10.8milliontonnesoforegrading2.72gramspertonne)afterproducing381,804ouncesofgold(410,000ouncesofin-situgoldmined).Thenetdecreasewasprimarilyduetotheminedepletion,partiallyoffsetbytheconversionofmineralresourcestomineralreservesfortheVaultpitextension.MeasuredandindicatedmineralresourcesattheMeadowbankminedecreasedby0.55milliontonnesin2015to7.0milliontonnesoforegrading3.21gramsofgoldpertonne.Thisdecreasewasprimarilyduetothedecreaseincut-offgradeusedtoestimatethemineralreservesandmineralresources.Inferredmineralresourcesincreasedby0.12milliontonnesoforein2015to3.4milliontonnesoforegrading3.99gramsofgoldpertonne,mainlyduetoanincreaseintheresourcepitshellgoldprice.

In2015,diamonddrillingatMeadowbankwasconductedinboththeVaultandthePortagepits.IntheVaultpit,80holesweredrilledforatotallengthof9,075metresinordertocomplete25x25-metredrillspacingintheVaultExtensionareaaswellasinthePhaserandBBPhaserpits.Thisdrillingconfirmedthepreviousmineralresourceestimate.AtPortage,32holesweredrilledinPitE3foratotallengthof1,653metrestocomplete25x25-metredrillspacinginapreviouslyinaccessibleareaaswellastoconfirmhighgradegoldintersectionsatthebottomofthepit.Thetotalcostofdrillingin2015amountedto$1.2million.In2016,1,500metresofconversiondrillingisplannedattheVaultpittocompletethedelineationdrillingbetweentheVaultmainpitandPhaserpittothesouth.

MeliadineProject

TheMeliadineprojectisanadvancedexploration/developmentpropertylocatednearthewesternshoreofHudsonBayintheKivalliqregionofNunavut,about25kilometresnorthofthehamletofRankinInletand290kilometressoutheastoftheMeadowbankmine.TheclosestmajorcityisWinnipeg,Manitoba,about1,500kilometrestothesouth.

TheCompanyacquiredits100%interestintheMeliadineprojectthroughitsacquisitionofComaplexinJuly2010.

ThemineralreservesandmineralresourcesoftheMeliadineprojectareestimatedatDecember31,2015tocontainprovenandprobablemineralreservesof3.42millionouncesofgoldin14.5milliontonnesoforegrading7.32gramsofgoldpertonne.Inaddition,theprojecthas20.8milliontonnesofindicatedmineralresourcesgrading4.95gramsofgoldpertonneand14.7milliontonnesofinferredmineralresourcesgrading7.51gramsofgoldpertonne.

TheMeliadinepropertyisalargelandpackagethatisnearly80kilometreslong.Itconsistsofmineralrights,aportionofwhichareheldundertheNorthwest Territories and Nunavut Mining Regulations andadministeredbyAboriginalAffairsandNorthernDevelopmentCanadaandreferredtoasCrownLand.TheCrownLandismadeupofminingclaimsandmineralleases.TherearealsosubsurfaceNTIconcessionsadministeredbyadivisionoftheNunavutterritorialgovernment.In2015,C$126,758waspaidtoIndigenousandNorthernAffairsCanadaforthemininglease.NTIrequiresannualrentalfeesofC$63,482andexplorationexpendituresofatleastC$268,636.

TheKivalliqregionhasanaridarcticclimate.Surfacegeologicalworkcanbecarriedoutfrommid-Maytomid-October,whileexplorationdrillingcantakeplacethroughouttheyear,thoughisreducedinDecemberandJanuaryduetocoldanddarkness.

Equipment,fuelanddrygoodsaretransportedontheannualwarm-weathersealiftbybargetoRankinInletviaHudsonBay.Ocean-goingbargesfromChurchill,ManitobaoreasternCanadianportscanaccessthecommunityfromlateJunetoearlyOctober.Churchill,whichisapproximately470kilometressouthofRankinInlet,hasadeep-waterportfacilityandayear-roundraillinktolocationstothesouth.


InOctober2013,theCompanycompletedconstructionofa23.8-kilometre-longall-weathergravelroadlinkingRankinInletwiththeprojectsite.ThisroadwasconstructedtosupportongoingexplorationactivitiesattheMeliadinepropertyandsignificantlyreducesthetransportationandlogisticalcostsforexplorationanddevelopmentwork.

LocationMapoftheMeliadineProject(asatDecember31,2015)


Facilities

SurfacePlanoftheMeliadineProject(asatDecember31,2015)

Thelatestplannedsurfaceinfrastructureisindicatedonthesurfaceplanmapaboveandconsistofmodularstructuresforthedormitories,kitchen,administrationofficeandtailingdrystacks,aswellasconventionalstructuresforthewarehouse,processplant,powerplant,metallurgicaltestlabandmobilemaintenanceshop.Thesurfaceplanalsoindicatestheplannedmineportals,ventilationraises,openpits,wastedumps,orepads,watermanagementstructures,attenuationpondandtailingsdrystacks.TheMeliadineprojecthasnotbeenapprovedforconstruction;theplannedinfrastructuredescribedhereincouldchangeduringtheprojectapprovalprocess.

Mining Methods

TheCompanycurrentlyanticipatesthatanyminingatMeliadinewouldbecarriedoutthroughtwoopenpitsandanundergroundmine.Itisestimatedthatapproximately3.4milliontonnesoforecouldbeextractedfromsurfaceminingand9.1milliontonnesoforecouldbeextractedbyundergroundminingoveranine-yearminelife.Itisexpectedthatanadditional1.4milliontonnesoflowergradematerialfromundergrounddevelopmentandopenpitmining(marginalore)wouldbestockpiledforprocessingattheendoftheminelife.


TheCompanyiscurrentlyevaluatingaplanthecontemplatesanundergroundoperationthatwoulddeliver3,000tonnesoforeperdaytotheprocessplantoverapproximatelynineyears.Undergroundaccesswouldbebydecline,withlong-holeminingexpected.Eachstopewillbebackfilled,withcementedpastefillusedinprimarystopesanddryrockfillforthesecondarystopes.Beginningattheendofthesecondyearofproduction,thetwoopenpitswouldbedeveloped,adding2,000tonnesoforeperdaytothemillfeedstartinginthefourthyear.Aconventionaltruck/shoveloperationisanticipatedfortheopenpits.

Surface Facilities

CurrentfacilitiesattheMeliadineprojectincludetheexplorationcamplocatedontheshoreofMeliadineLake,approximately2.3kilometreseastoftheTiriganiaqdeposit.Theself-containedcampconsistsoffivewingsoftrailersthatcanaccommodateupto400personnelandincludeskitchenfacilities,completewithdieselgenerators.

Powerfortheexplorationcampiscurrentlyprovidedbydieselgenerators.PotablewaterfortheexplorationcampispumpedfromMeliadineLakeandwaterfortheundergroundoperationsandsurfacedrillprogramsispumpedfromPumpLake.Thecurrentwaterlicencesallowforamaximumdailywateruseof299cubicmetres.

Theexplorationcamphasanincineratoronsitetoburnallflammablematerials,suchascampandfoodwastes.Incineratorashes,plasticsandmetalobjects,alongwithallhazardoussolidandliquidwastesarecollectedattheMeliadineprojectsiteandthentransportedtoawastemanagementcompanyinsouthernCanada.

SewagehasbeentreatedthroughaBiodisktreatmentsystemsincethesummerof2010.Routinewatersamplingisconductedandreportedonamonthlybasistotheauthorities.

ThedecommissioningoftheMeliadineEastcamponAtulikLakebeganduringthesummerof2010,andwascompletedbyspring2011.Thecoreshackandstoragebuildingremainattheformercampsite.

AnundergroundportalallowingaccesstoanexplorationrampwasbuiltattheTiriganiaqdepositin2007and2008inordertoextractabulksampleforstudypurposes.Awasterockandorestoragepadwasbuiltduringexcavationoftherampandasamplingtowerwasinstalledforprocessingthebulksample.Thereisatwo-kilometre-longroadbetweentheMeliadineprojectexplorationcampandtheportalsite.Anotherundergroundbulksampleof4,600tonnesoforewastakenfromtheTiriganiaqdepositviathisportalin2011.


Morethan39metallurgicaltestprogramshavebeenconductedattheMeliadineproject.Basedontheresultsofthesetestprograms,aconventionalgoldcircuithasbeenrecommended,comprisingcrushing,grinding,gravityseparationandcyanideleaching,withacarbon-in-leachcircuit(CIL),followedbycyanidedestructionandfiltrationofthetailingsfordrystacking.

GlobalgoldrecoveryattheMeliadineproject,shouldaminebeconstructed,isestimatedtobe94.7%,basedonthemineralresourcesandmineralreservesestimatesasofDecember31,2014.Thecurrentplanenvisionsaprocessingrateof3,000tonnesoforeperdayforthefirstthreeyearsofproduction,and5,000tonnesoforeperdayfortheremainderofthelifeofmine,withanestimatedplantavailabilityrateof92%.

Environmental Matters (including Inuit Impact and Benefit Agreement), Permitting and Social Matters

LandandenvironmentalmanagementintheregionoftheMeliadineprojectisgovernedbytheprovisionsoftheNLCA.TheMeliadineprojectislocatedonInuit-ownedland,whereInuitownboththesub-surfacemineralrights(managedbyNTI)andthesurfacelandrights(managedbytheKIAonbehalfofInuitbeneficiariesundertheprovisionsoftheNLCA).Consequently,toexploreanddeveloptheproject,theCompanymustobtainlanduseleasesfromtheKIA.TheCompanyhasbeengrantedacommercialleasebytheKIAforexplorationandundergrounddevelopmentactivity,aprospectingandlanduseleaseforexplorationanddevelopmentactivities,anexplorationlanduseleaseforexplorationanddrillingontheInuit-ownedlandsofMeliadineEastandaparceldrillingpermitfordrillingactivityonInuit-ownedlands.Anumberofright-of-wayleasescoveringroadaccesstotheMeliadineprojectpropertyandeskerquarryingontheInuit-ownedlandswerealsograntedbytheKIA.

PursuanttotheNLCAandtheNunavut Waters and Nunavut Surface Rights Tribunal Act requirements,theCompanyobtainedseveralwateruselicencesfromtheNWB,coveringongoingwateruseforitsMeliadineprojectexplorationcamp,theundergroundbulksamplingprogramandforongoingexplorationdrillingactivities.


In2011,theCompanyinitiatedtheenvironmentalassessmentprocessfortheMeliadineprojectwiththeobjectiveofobtainingaprojectcertificatefromtheGovernmentofCanadafortheconstruction,operationandultimatedecommissioningofthefullproject.Theprojectcertificateisrequiredbeforeobtainingthepermitsrequiredtoconstruct,operateanddecommissionagoldmineatMeliadine.InMay2011,theKIAreferredtheMeliadineprojecttotheNIRBforscreeningundertheNLCA.OnMay4,2011,theNIRBreceivedtheMeliadineprojectproposalfromtheCompany.OnJune8,2011,theNIRBreceivedapositiveconformitydeterminationfromtheNunavutPlanningCommissionfortheMeliadineprojectinrelationtotheKeewatinRegionalLandUsePlan.

In2011,theNIRBissuedascreeningdecisionreporttothen-MinisterofIndianandNorthernAffairsCanada(nowMinisterofIndigenousandNorthernAffairsCanadaorthe"Minister"),recommendingareviewand,onSeptember14,2011,theMinisterreferredtheMeliadineprojectproposaltotheNIRBforareviewoftheecosystemicandsocio-economicimpactsoftheproject.TheNIRBfinalizedtermsofreferenceforthisreviewandtherequiredEnvironmentalImpactStatement("EIS")inearly2012.

InApril2013,theCompanysubmittedthedraftEISfortheMeliadineprojecttotheNIRB.TheNIRBapprovedtheprojectonOctober15,2014andrecommendedtotheMinistertoapprovetheproject.OnJanuary27,2015,theMinisterapprovedtheenvironmentalassessmentfindingsandrecommendationsmadebytheNIRB.TheMinisterdirectedtheNIRBtoissueAgnicoEagleaProjectCertificatefortheMeliadineprojectsettingoutthetermsandconditionsunderwhichtheMeliadineprojectcanproceed(asperconditionssetoutintheNIRBreportofOctober10,2014).TheProjectCertificatewasreceivedonFebruary26,2015.AnapplicationforaTypeAwaterlicencefromtheNWBwassubmittedin2015anditisexpectedtobedeliveredin2016.AcommercialproductionlanduseleasefromtheKIAisalsoexpectedin2016.ALicenceBforpre-developmentworkatMeliadinewasreceivedinOctober2015.

AnInuitImpactandBenefitAgreementfortheMeliadineproject(the"MeliadineIIBA")wassignedwiththeKIAinJuly2015.TheMeliadineIIBAaddressesprotectionofInuitvalues,cultureandlanguage,protectionoftheland,waterandwildlife,providesfinancialcompensationtoInuitovertheminelifeandcontainsprovisionfortraining,employmentandcontracting.AnInuitwatercompensationagreementinaccordancewiththeNLCAisbeingfinalized.


TotalcapitalexpendituresattheMeliadineprojectin2015were$66.7million,includingcapitalizedsurfaceandundergrounddrilling,rampdevelopment,permitting,campoperationandtechnicalstudies.

Capitalexpendituresof$96.0millionhavebeenbudgetedfortheMeliadineprojectin2016,focusedondetailedengineeringandprocurement,constructionofessentialsurfaceinfrastructureandacquisitionofausedcamp.

AnupdatedtechnicalreportcompletedinMarch2015hasconfirmedtheeconomicviabilityoftheMeliadineprojectwithanapproximatenine-yearminelifeatanoperatingrateof3,000tonnesperdayinyearsonetothree,and5,000tonnesperdayinyearsfourtonine.Thefollowingtablesetsoutasummaryoftheapproximateforecastsforinitialcapitalcosts,sustainingcapitalcosts,minelife,annualcashflow,netpresentvalue,internalrateofreturnandpaybackperiod.

Initial capital costs $ 911million

Sustaining capital costs $ 357million

Mine life 9years

Annual cash flow $ 269.7million(1)

After-tax net present value (at a 5% discount rate) $ 267million

After tax internal rate of return 10.3%

Payback period 5.0years

Note:

(1) The"AnnualCashFlow"isbasedonthesimpleaverageoftheestimated(pre-tax)annualcashflowforeachofthenineyearsofminingoperations.

TheeconomicanalysisintheabovetableisbasedontheupdatedtechnicalreportcompletedinMarch2015andusesfollowingassumptions:priceofgoldof$1,300perounce;US$/C$exchangerateofC$1.15per$1.00;C$0.95perlitredieselcost;andstatutorytaxrateofapproximately26%.VariouspotentialscenariosarebeingevaluatedbeforetheCompanycandeterminewhethertobuildamineatMeliadine.


Development

In2015,2,605metresofhorizontaldevelopmentand84metresofverticaldevelopmentwerecompletedattheMeliadineproject.For2016,theCompanyexpects3,723metresofhorizontaldevelopment(including1,393metresoftotalrampdevelopment)and503metresofverticaldevelopmenttobecompleted.


Geology and Mineralization

ArcheanvolcanicandsedimentaryrocksoftheMeliadinegreenstonebeltunderlietheproperty,whichismainlycoveredbyglacialoverburdenwithdeep-seatedpermafrostandispartoftheWesternChurchillsupergroupinnorthernCanada.Therocklayershavebeenfolded,shearedandmetamorphosed,andhavebeentruncatedbythePykeFault,aregionalstructurethatextendstheentire80-kilometrelengthofthelargeproperty.

ThePykeFaultappearstocontrolgoldmineralizationontheMeliadineproperty.AtthesouthernedgeofthefaultisaseriesofoxideironformationsthathostthesevenMeliadineprojectdepositscurrentlyknown.Thedepositsconsistofmultiplelodesofmesothermalquartz-veinstockworks,laminatedveinsandsulphidizedironformationmineralizationwithstrikelengthsofuptothreekilometres.TheUpperOxideironformationhoststheTiriganiaqandWolfNorthzones.ThetwoLowerLeanironformationscontaintheFZone,Pump,WolfMainandWesmegdeposits.TheNormegzonewasdiscoveredin2011ontheeasternendoftheWesmegzone,nearTiriganiaq.TheWolf(NorthandMain),FZone,PumpandWesmeg/NormegdepositsareallwithinfivekilometresofTiriganiaq.TheDiscoverydepositis17kilometreseastsoutheastofTiriganiaqandishostedbytheUpperOxideironformation.Eachofthesedepositshasmineralizationwithin120metresofsurface,makingthempotentiallymineablebyopenpitmethods.Theyalsohavedeeperorethatcouldpotentiallybeminedwithundergroundmethods,whicharecurrentlybeingconsideredinvariousstudies.

Twobulksampleshavebeenextractedfromtheexplorationramp.Theresultsconfirmedtheresourceestimationmodelthathasbeendevelopedforthetwoprincipalzones(Zones1000and1100)atTiriganiaq,andindicatedapproximately6%moregoldthanhadbeenpredictedbytheblockmodelfortheseareas.The2011bulksampleprogramalsoconfirmedthepreviousassessmentoftheCompany'sblockmodelintermsofgradecontinuity,consistencyanddistribution,andtheevaluationofrelatedminingpropertiesthroughgeologicalmapping,undergroundchip,channelandmucksampling,andgeotechnicalobservations.


ThefirstmineralresourcesestimateatMeliadinewasmadebyStrathconaMineralServicesin2005forthen-ownerComaplex,andcomprisedindicatedmineralresourcesof2.5milliontonnesgrading10.8gramsofgoldpertonne(containing853,000ouncesofgold)andinferredmineralresourcesof1.1milliontonnesgrading13.2gramspertonneofgold(containing486,000ouncesofgold),withallresourcesintheTiriganiaqdeposit.Followingthis,therewereannualestimatesgraduallyincludingnewdeposits,suchasDiscovery,FZone,PumpandWolf.ThefinalmineralresourcesestimatemadebeforetheCompanyacquiredthepropertywasmadebySnowdenMiningIndustryConsultantsforComaplexinJanuary2010anditcomprisedmeasuredandindicatedmineralresourcesof12.9milliontonnesgrading7.9gramsofgoldpertonne(containing3.3millionouncesofgold)andinferredmineralresourcesof8.4milliontonnesgrading6.4gramsofgoldpertonne(containing1.7millionouncesofgold).

ProvenandprobablegoldreservesatMeliadineincreasedin2015byapproximately82,000ouncesto3.4millionouncesofgold(14.5milliontonnesoforegrading7.32gramspertonne).IndicatedmineralresourcesatMeliadineincreasedby0.5milliontonnesoforein2015to20.8milliontonnesoforegrading4.95gramsofgoldpertonne.Inferredmineralresourcesincreasedby0.6milliontonnesoforein2015to14.7milliontonnesoforegrading7.51gramsofgoldpertonne.Theincreasesinmineralreserves,indicatedmineralresourcesandinferredmineralresourceswereprimarilyduetochangesinmodelingparametersimplementedtobetterreconcilewiththetwopreviousbulksamples,aswellastheuseoflowercostsestablishedinrecentstudies.

In2015,theCompanyspent$2.0millionon36diamonddrillholes(5,700metres)atMeliadine.TherewasnoexplorationatMeliadinein2015otherthandrilling.The2016planincludesspending$1.7millionon53diamonddrillholes(9,300metres)atMeliadine.


Southern Business

PinosAltosMine

ThePinosAltosmineachievedcommercialproductioninNovember2009.ItislocatedintheSierraMadregoldbelt,285kilometreswestoftheCityofChihuahuaintheStateofChihuahuainnorthernMexico.AtDecember31,2015,thePinosAltosminewasestimatedtocontainprovenandprobablemineralreservesof1.46millionouncesofgoldand37.53millionouncesofsilvercomprisedof15.7milliontonnesoforegrading2.88gramsofgoldpertonneand74.18gramsofsilverpertonne.TheCrestonMascotadepositatPinosAltosachievedcommercialproductioninthefirstquarterof2011.AtDecember31,2015,theCrestonMascotadepositwasestimatedtocontainadditionalprovenandprobablemineralreservesof0.18millionouncesofgoldand1.63millionouncesofsilvercomprisedof4.2milliontonnesoforegrading1.30gramsofgoldpertonneand12.02gramsofsilverpertonne.ThePinosAltospropertyismadeupoftwoblocks:theAgnicoEagleMexicoConcessions(25concessions)andthePinosAltosConcessions(18concessions).

LocationMapofthePinosAltosMine(asatDecember31,2015)

Approximately74%ofthecurrentPinosAltosmineralreservesandmineralresources,including9%fortheCrestonMascotadepositatPinosAltos,aresubjecttoanetsmelterreturnroyaltyof3.5%payabletoPinosAltosExplotaciónyExploraciónS.A.deC.V.("PAEyE")andtheremaining26%ofthecurrentmineralreservesandresourcesatPinosAltosaresubjecttoa2.5%netsmelterreturnroyaltypayabletotheServicioGeológicoMexicano,aMexicanFederalGovernmentagency.After2029,thisportionofthepropertywillalsobesubjecttoa3.5%netsmelterreturnroyaltypayabletoPAEyE.

TheassetsacquiredbytheCompanyfromPAEyEandtheAsociacióndePequeñosPropietariosForestalesdePinosAltosSdeR.L.in2008includedtherighttouseupto400hectaresoflandformininginstallationsforaperiodof20yearsafterformalminingoperationshavebeeninitiated.TheCompanyalsoobtainedsoleownershipoftheAgnicoEagleMexicoConcessionspreviouslyownedbyCompaniaMineraLaParreñaS.A.deC.V.During2008,theCompanyandPAEyEenteredintoanagreementunderwhichtheCompanyacquiredfurthersurfacerightsforopenpitminingoperationsandadditionalfacilities.Infrastructurepayments,surfacerightspaymentsandadvanceroyaltypaymentstotaling$35.5millionweremadetoPAEyEandtheAsociacióndePequeñosPropietariosForestalesdePinosAltosSdeR.L.in2008asaresultofthisagreement.


Between2006and2008,theCompanyconcludednegotiationswithcommunallandowners(ejidos)andothersfortheacquisitionof6,238hectaresoflandcontainedwithintheAgnicoEagleMexicoandPinosAltosConcessions.Inaddition,atemporaryoccupationagreementwitha30-yeartermexpiringin2036wasnegotiatedwithejidoJesusdelMontefor1,470hectaresoflandcoveredbythesesameconcessionblocks.TheacquisitionofthesesurfacerightsforthegeologicallyprospectivelandswithinthedistrictsurroundingthePinosAltospropertywillfacilitatefutureexplorationandminingdevelopmentintheseareas.ThePinosAltosmineisdirectlyaccessiblebyapavedinterstatehighwaythatlinksthecitiesofChihuahuaandHermosillo.

InAugust2007,onthebasisofanindependentlyreviewedfeasibilitystudy,theCompanyapprovedconstructionofamineatPinosAltos.ThemineachievedcommercialproductioninNovember2009.

Basedonafeasibilitystudypreparedin2009,theCompanydecidedtobuildastand-aloneheapleachoperationattheCrestonMascotadepositatPinosAltos.ThefirstgoldpourfromtheCrestonMascotadepositoccurredonDecember28,2010andcommercialproductionfromtheCrestonMascotadepositwasachievedinthefirstquarterof2011.

TheCompanycontinuestoevaluateopportunitiestodevelopothermineralresourcesthathavebeenidentifiedinthePinosAltosareaassatelliteoperations.

TheCompanyhasengagedthelocalcommunitiesintheareawithhiring,localcontracts,educationsupportandmedicalsupportprogramstoensurethatthemineprovideslong-termbenefitstotheresidentslivingandworkingintheregion.Approximately70%oftheoperatingworkforceatPinosAltosarelocallyhiredand100%ofthepermanentworkforceattheCompanyoperationsinMexicoareMexicannationals.


SurfacePlanofthePinosAltosMine(asatDecember31,2015)


SurfacePlanoftheCrestonMascotaDepositatPinosAltos(asatDecember31,2015)

Millingoperationsduring2015atPinosAltosprocessedanaverageof5,462tonnesoforeperdayascomparedtotheoriginaldesignrateof4,000tonnesperday.TheundergroundmineatPinosAltosproducedanaverageof2,834tonnesoforeperdayascomparedtoitsdesignedrateof3,000tonnesperday.TheopenpitminesatPinosAltosandtheCrestonMascotadepositproduced19.0milliontonnesofore,overburdenandwastein2015,comparedto21.7milliontonnesin2014.

Mining Methods

ThesurfaceoperationsatthePinosAltosmineusetraditionalopenpitminingtechniqueswithbenchheightsofsevenmetresanddoublebenchesonthefootwallandsinglebenchingonthehangingwall.Miningisaccomplishedwithfrontendloaders,trucks,trackdrillsandvarioussupportequipment.Basedupongeotechnicalevaluations,thefinalpitslopesvarybetween45degreesand50degrees.PerformanceattheopenpitminingoperationatPinosAltosduring2015continuestoindicatethattheequipment,miningmethodsandpersonnelselectedfortheprojectaresatisfactoryforfutureproductionphases.9.6milliontonnesofore,overburdenandwastewereminedduring2015.

Theundergroundmine,whichcommencedoperationsinthesecondquarterof2010,usesthelongholesublevelstopingmethodtoextractore.Thestopeheightis30metresandthestopewidthis15metres.Oreishauledtothesurfaceutilizingundergroundtrucksviaarampsystem.Thepastebackfillsystemandventilationsystemwerecommissionedinthefourthquarterof2010.During2015,approximately1.0milliontonnesoforewereproducedfromtheundergroundportionofthemine,averaging2,834tonnesperday.Currently,theplannedcapacityoftheundergroundmineis3,000tonnesoforeperday.Constructionofashafthoistingfacilitytoincreasetheminingcapacityto4,500tonnesoforeperdaywasinitiatedin2012,withcommissioningexpectedtobecompletedin2016.Theshafthoistingcapacityshouldreducetheneedforadditionalundergroundtrucksrequiredastheminedepthincreasesandisexpectedtocontinuetomaintainmillfeedratesat4,500tonnesoforeperdayinfutureyearsastheopenpitminesatPinosAltosbecomedepleted.Approximately50.8kilometresoftotallateraldevelopmenthavebeencompletedasofDecember31,2015.


Surface Facilities

TheprincipalmineralprocessingfacilitiesatthePinosAltosmineweredesignedtoprocess4,000tonnesoforeperdayinaconventionalprocessplantcircuitwhichincludessinglestagecrushing,grindinginaSAGandballmillinclosedloop,gravityseparationfollowedbyagitatedleaching,counter-currentdecantationandmetalsrecoveryintheMerrill-Croweprocess.Tailingsaredetoxifiedandfilteredandthenusedforpastebackfillintheundergroundmineordepositedasdrytailingsinanengineeredtailingsimpoundmentarea.ThePinosAltosmillprocessedanaverageof5,462tonnesoforeperdayduring2015.LowgradeoreatPinosAltosisprocessedinaheapleachsystemdesignedtoaccommodateapproximatelyfivemilliontonnesofmineralizedmaterialoverthelifeofthemine.Theproductionfromheapleachoperationsisexpectedtoberelativelyminor,contributingabout1%oftotalmetalproductionplannedfortheremaininglifeofthemine(notincludingproductionfromtheCrestonMascotaheapleachoperation).

OthersurfacefacilitiesatthePinosAltosmineinclude:aheadframeandhoistroom,aheapleachpad,pond,linerandpumpingsystem;administrativesupportoffices;campfacilities;alaboratory;aprocessplantshop;amaintenanceshop;apowergeneratingstation;surfacepowertransmissionlinesandsubstations;anengineeredtailingsmanagementsystem;andawarehouse.

AseparateheapleachoperationandancillarysupportfacilitieswerebuiltattheCrestonMascotadeposit,whichisdesignedtoprocessapproximately4,000tonnesoforeperdayinathreestagecrushing,agglomerationandheapleachcircuitwithcarbonadsorption.Thisprojectwascommissionedinthelatterpartof2010,withcommercialproductionachievedinthefirstquarterof2011.During2015,atotalof2.0milliontonnesoforewasminedfromtheCrestonMascotadeposit,averaging5,554tonnesperday.BasedonperformanceofthemineandprocessfacilitiesattheCrestonMascotadeposittodate,theequipment,miningmethodsandpersonnelaresatisfactoryforcompletionoftheplannedproductionphases.TheCrestonMascotadepositisexpectedtoproduceapproximately45,000ouncesofgoldin2016.

Overtheremaininglifeofthemine,recoveriesofgoldandsilverinthemillingcircuitatPinosAltos(otherthanfromtheCrestonMascotadeposit)areexpectedtoaverageapproximately93%and43%,respectively.TheCompanyanticipatespreciousmetalsrecoveryfromlowgradeoreprocessedinthePinosAltosheapleachfacilitywillaverage68%forgoldand12%forsilver.HeapleachrecoveriesfororefromtheCrestonMascotadepositareexpectedtoaverage63%forgoldand8%forsilver.


During2015,thePinosAltosmine,includingtheCrestonMascotadeposit,hadtotalpayableproductionof247,677ouncesofgoldandapproximately2.5millionouncesofsilverfromthePinosAltosmillandtheheapleachpadsatthePinosAltosmineandtheCrestonMascotadeposit.ThetotalcashcostsperounceofgoldproducedatPinosAltosin2015was$387onaby-productbasis.TheaverageminesitecostspertonneforalloreatPinosAltoswere$45.

Ofthetotalin2015,thePinosAltosmillhadpayableproductionof185,269ouncesofgoldand2,329,993ouncesofsilverfrom1.99milliontonnesoforegrading3.05gramsofgoldpertonneand79.9gramsofsilverpertonne.In2015,thetotalcashcostsperounceofgoldproducedfromoretreatedatPinosAltoswas$387onaby-productbasisand$578onaco-productbasisandtheprocessingfacilityaveraged5,462tonnesoforeperdayandoperated93.1%ofavailabletime.Inthemill,goldrecoveryaveraged94%andsilverrecoveryaveraged43%andtheminesitecostspertonnefororetreatedatPinosAltoswere$45in2015.

ThefollowingtablesetsoutthemetalrecoveriesatthePinosAltosmillin2015.

Head Grade

Overall Metal

RecoveryPayable

Production

Gold 3.05g/t 94% 185,269oz

Silver 79.9g/t 43% 2,329,993oz

Ofthe2015total,thePinosAltosheapleachhadpayableproductionof7,705ouncesofgoldand55,000ouncesofsilverfrom0.39milliontonnesoforegrading0.75gramsofgoldpertonneand21.0gramsofsilverpertonne.


ThecumulativerecoveryforgoldandsilverontheheapleachpadatPinosAltosareapproximately72%and15%,respectively.Heapleachrecoveryisfollowingtheexpectedcumulativerecoverycurveanditisanticipatedthattheultimaterecoveryof68%forgoldand12%forsilverwillbeachievedwhenleachingiscompleted.

Ofthe2015total,theheapleachattheCrestonMascotadeposithadpayableproductionof54,702ouncesofgoldand159,000ouncesofsilverfrom2.1milliontonnesoforegrading1.34gramsofgoldpertonneand16.9gramsofsilverpertonne.In2015,thetotalcashcostsperounceofgoldproducedfromthisorewas$430onaby-productbasisand$474onaco-productbasis.Theminesitecostspertonneforthisorewere$12in2015.

ThecumulativemetalsrecoveryforgoldandsilverontheheapleachpadattheCrestonMascotadepositareapproximately58%and11%,respectively.Heapleachrecoveryisfollowingtheexpectedcumulativerecoverycurveanditisanticipatedthattheultimaterecoveryof63%forgoldand11%forsilverwillbeachievedwhenleachingiscompleted.

Productionduring2016atthePinosAltosmine,includingtheCrestonMascotadeposit,isexpectedtobeapproximately220,000ouncesofgoldand2,331,000ouncesofsilverfrom4.21milliontonnesoforegrading2.06gramsofgoldpertonneand44.7gramsofsilverpertonne,atestimatedtotalcashcostsperounceofgoldofapproximately$480onaby-productbasis,withestimatedgoldrecoveryof78.6%andsilverrecoveryof28.1%.Minesitecostspertonneofapproximately$34foralloreareexpectedin2016.

Ofthistotal,in2016PinosAltos(excludingCrestonMascota)isexpectedtoproduceapproximately175,000ouncesofgoldand2,218,000ouncesofsilverfrom2.1milliontonnesoforegrading2.77gramsofgoldpertonneand74.1gramsofsilverpertonne,atestimatedtotalcashcostsperounceofgoldofapproximately$443onaby-productbasis,withestimatedgoldrecoveryof95.5%andsilverrecoveryof74.1%.Minesitecostspertonneofapproximately$54formilledoreareexpectedin2016.TheheapleachattheCrestonMascotadepositisexpectedtoproduceapproximately45,000ouncesofgoldand113,000ouncesofsilverfrom2.0milliontonnesoforegrading1.17gramsofgoldpertonneand12.5gramsofsilverpertonne,atestimatedtotalcashcostsperounceofgoldofapproximately$604onaby-productbasis,withestimatedgoldrecoveryof60.0%andsilverrecoveryof13.4%.Minesitecostspertonneofapproximately$15forCrestonMascotaheapleachoreareexpectedin2016.


ThePinosAltosminehasreceivedthenecessarypermitauthorizationsforconstructionandoperationofamine,includingaChangeofLandUsepermitandanEnvironmentalImpactStudyapprovalfromtheapplicableMexicanenvironmentalagency.AsofDecember31,2015,allpermitsnecessaryfortheoperationofthePinosAltosmine,includingtheoperationsattheCrestonMascotadeposit,hadbeenreceived.PinosAltosusesthedrystacktailingstechnologytominimizethegeotechnicalandenvironmentalriskthatcanbeassociatedwiththerainfallintensitiesandtopographicreliefintheSierraMadreregionofMexico.

Followinganauditprocessbyanindependentthirdparty,theoperationsatboththePinosAltosmineandtheCrestonMascotadeposithavereceivedthe"IndustriaLimpia"certificationfromtheMexicanenvironmentalauthorities.Thiscertificationisbasedoncompliancewithenvironmentalrequirements.

Asthedrytailingsstackapproachedfullcapacity,aplanwaspreparedtodeposittailingsinthedepletedOberonWeberpit.Geotechnicalstudieswereperformed,anartificialcrownpillarwasconstructedatthebottomofthepitandwaterdrainageinfrastructurewasconstructedtoevacuatewateroutofthepitasrequired.Tailingsweredepositedinthepitbeginninginthefourthquarterof2015.


CombinedcapitalexpendituresatthePinosAltosandCrestonMascotadepositduring2015wereapproximately$71.6million,excludingcapitalizeddrilling.Combinedcapitalexpendituresincludedsustainingcapitalforshaftconstructionandcommissioning,undergroundequipmentmajorcomponents,silverflotationplant,CrestonMascotaphase4leachpadandpondandOberondeWebertailingsdam.

In2016,theCompanyexpectscapitalexpendituresatPinosAltos,includingtheCrestonMascotadeposit,tobeapproximately$61million,excludingcapitalizeddrilling.Capitalexpendituresin2016areprimarilybeingusedforundergroundminedevelopment,shaftconstruction,tailingsmanagementandgeneralsustainingactivities.


Development

AsofDecember31,2015,fortheminelifetodate,morethan127milliontonnesofore,overburdenandwastehadbeenremovedfromtheopenpitmineatPinosAltosandapproximately51kilometresoflateraldevelopmenthadbeencompletedintheundergroundmine.AttheCrestonMascotadeposit,approximately44milliontonnesofore,overburden,andwastehadbeenremovedfromtheopenpitmineasofDecember31,2015.

A$106.0millionshaftsinkingprojectremainsonscheduleforcompletionin2016atPinosAltos.Uponcompletion,itisexpectedthatthisnewshaftwillfacilitateimprovedmatchingofminingandmillcapacityastheopenpitminingoperationwindsdown.


Geology

ThePinosAltosmineisinthenorthernpartoftheSierraMadregeologicprovince,onthenortheastmarginoftheOcampoCaldera,whichhostsmanyepithermalgoldandsilveroccurrences,includingthenearbyOcampoandMorismines.

ThepropertyisunderlainbyTertiary-age(lessthan45millionyearsold)volcanicandintrusiverocksthathavebeendisturbedbyfaulting.Thevolcanicrocksbelongtothelowervolcaniccomplexandthediscordantoverlyinguppervolcanicsupergroup.ThelowervolcaniccomplexisrepresentedonthepropertybytheNavosaigameconglomerates(includingthinly-beddedsandstoneandsiltstone)andtheElMadronovolcanics(felsictuffsandlavasintercalatedwithrhyolitictuffs,sandyvolcanoclasticsandsediments).TheuppervolcanicgroupismadeupoftheVictoriaignimbrites(explosivefelsicvolcanics),theFrijolarandesites(massivetoflow-banded,porphyriticflows)andtheBuenavistaignimbrites(dacitictorhyoliticpyroclastics).

Intermediateandfelsicdykesaswellasrhyoliticdomesintrudealloftheseunits.TheSantoNinoandesiteisadykethatintrudesalongtheSantoNinofaultzone.

Structureonthepropertyisdominatedbyaten-kilometrebythree-kilometrehorst,afault-upliftedblockstructureorientedwest-northwest,thatisboundedonthesouthbythesouth-dippingSantoNinofaultandonthenorthbythenorth-dippingReynadePlatafault.Quartz-goldveindepositsareemplacedalongthesefaultsandalongtransferfaultsthatsplayoutwardsfromtheSantoNinofault.

Mineralization

GoldandsilvermineralizationatthePinosAltosmineconsistsoflowsulphidationtypeepithermal-typehydrothermalveins,brecciasandbodies.TheSantoNinostructureoutcropsoveradistanceofroughlysixkilometres.Itstrikesat60degreesazimuthonitseasternportionandturnstostrikeroughly90degreesazimuthonitswesternfringe.Thestructuredipsat70degreestowardsthesouth.ThefourmineralizedsectorshostedbytheSantoNinostructureconsistofdiscontinuousquartzrichlensesnamedfromeasttowest:ElApache,OberondeWeber,SantoNinoandCerroColorado.

TheElApachelensisthemostweaklymineralized.Theareahostsaweaklydevelopedwhitequartzdominatedbreccia.Goldvaluesarelowanderraticoveritsroughly750metrestrikelength.Pastdrillingsuggeststhatthiszoneisoflimitedextentatdepth.

TheOberondeWeberlenshasbeenfollowedonsurfaceandbydiamonddrillingoveranextentofroughly500metres.ShallowholesdrilledbytheCompanyshowgoodcontinuitybothintermsofgradeandthicknessoverroughly550metres.FromthepreviousdrillingdonebyPenoles,continuityatdepthappearstobeerraticwithaweaklydefinedwesternrake.

TheSantoNinolensisthemostverticallyextensiveoftheselenses.Ithasbeentracedtoadepthofapproximately750metresbelowthesurface.Theveinisfollowedcontinuouslyonsurfaceoveradistanceof550metresanddiscontinuouslyupto650metres.Beyonditswesternandeasternextents,theSantoNinoandesiteismassiveandonlyweaklyaltered.Goldgradesfoundaresystematicallyassociatedwithgreenquartzbrecciatedandesite.

TheCerroColoradolensisstructurallymorecomplexthanthethreedescribedabove.Nearthesurface,itismarkedbyacomplexsuperpositionofbrittlefaultswithmineralizedzoneswhicharedifficulttocorrelatefromholetohole.ItsrelationtotheSantoNinofaultzoneisnotclearlydefined.TwodeeperholesdrilledbytheCompanysuggestbettergradecontinuityispossibleatdepth.

TheSanEligiozoneislocatedapproximately250metresnorthofSantoNino.ThehostrockisbrecciatedVictoriaIgnimbrite,occasionallywithastockworkstyleofmineralization.Thereisnoandesiteinthissector.Unliketheotherlenses,theSanEligiolensdipstowardsthenorth.Thelateralextentofthezoneseemstobecontinuousfor950metres.Its


averagewidthisfivemetresandneverexceeds15metres.Surfacemappingandprospectinghassuggestedthatthereisgoodpotentialforadditionalmineralizationonstrikeandatdepthsbelow150metres.Visiblegoldhasbeenseeninthedrillcore.

TheCrestonMascotadepositissevenkilometresnorthwestoftheSantoNinodeposit,andissimilar,butdipsshallowlytothewest.TheCrestonMascotadepositisabout1,000metreslongand4to40metreswide,andextendsfromsurfacetomorethan200metresdepth.

Severalotherpromisingzonesareassociatedwiththehorstfeatureinthenorthwestpartoftheproperty.TheCubirodepositisanear-surfacedepositlocatedtwokilometreswestoftheCrestonMascotadeposit.Cubirostrikesnorthwest,hasasteepdipandhasbeenfollowedalongstrikeforapproximately850metres.Drillinghasintersectedsignificantgoldandsilvermineralizationupto30metresinwidth.TheCubirodepositissplitbyafaultthatresultedin200metresofdisplacementtothewest,asdefinedbydrillingtodate.Thezoneisstillopentothesoutheastandpossiblyatdepth.

TheSinterzoneis1,500metresnorth-northeastoftheSantoNinozoneandispartoftheReynadePlatagoldstructure.Thesteeplydippingmineralizationrangesfromfourto35metresinwidthandalmost900metreslong,withover350metresofverticaldepth.Sinterisbeingevaluatedforitsopenpitandundergroundminingpotential.

OtheridentifiedmineralresourcesinthePinosAltosregionincludetheBravoandCarolazonesadjacenttotheCrestonMascotadepositandtheReynadelaPlataprospectfurthertotheeast.ExplorationeffortswillbeallocatedtothesezonesasdevelopmentcontinuesatPinosAltosandtheCrestonMascotadeposit.


In2015,provenandprobablemineralreservesatPinosAltos(excludingCrestonMascota)decreasedbyapproximately304,000ouncesofgoldand9.15millionouncesofsilverto1.46millionouncesofgoldand37.53millionouncesofsilver(15.7milliontonnesoforegrading2.88gramsofgoldpertonneand74.18gramsofsilverpertonne)afterproducing192,974ouncesofgold(205,000ouncesofin-situgoldmined)and2.38millionouncesofsilver.ThenetdecreasewasaresultofminedepletionaswellasachangetotheCerroColoradoblockmodelbasedoninformationgainedfromgeologicalmappingandminingdevelopment.IndicatedmineralresourcesatPinosAltosdecreasedby0.8milliontonnesoforein2015to11.1milliontonnesoforegrading1.83gramsofgoldpertonneand42.43gramsofsilverpertonneduetoamoreconservativeapproachattheCerroColorado,OberondeWeberandSinterdeposits.Inferredmineralresourcesdecreasedby0.1milliontonnesoforein2015to12.6milliontonnesoforegrading1.25gramsofgoldpertonneand29.33gramsofsilverpertonne.

In2015,provenandprobablemineralreservesattheCrestonMascotadepositdecreasedbyapproximately59,000ouncesofgoldand0.90millionouncesofsilverto0.18millionouncesofgoldand1.63millionouncesofsilver(4.2milliontonnesoforegrading1.30gramsofgoldpertonneand12.02gramsofsilverpertonne)afterproducing54,703ouncesofgold(90,000ouncesofin-situgoldmined)and0.16millionouncesofsilver.Thenetdecreasewasaresultofminedepletion.IndicatedmineralresourcesattheCrestonMascotadepositincreasedby2.0milliontonnesoforein2015to4.3milliontonnesoforegrading0.51gramsofgoldpertonneand5.14gramsofsilverpertonneduetowireframemodificationsandreclassificationofsomeindicatedmineralresourcestoprobablemineralreserves.TheinferredmineralresourcesattheCrestonMascotadepositdecreasedby0.2milliontonnesoforein2015to4.3milliontonnesoforegrading1.06gramsofgoldpertonneand14.16gramsofsilverpertonne.Drillingandevaluationwillcontinuein2016.

In2015,minesiteexplorationactivitieswereprimarilyfocusedonconversion,infillandexplorationofthemineralresourcesattheCrestonMascota,Sinter,BravoandReynadePlatadeposits.Atotalof8,960metresofminesiteexplorationdrillingand3,540metresofdefinition(conversion)drillingwerecompletedduringtheyear.

In2016,theCompanyexpectstospendapproximately$3.1milliononexplorationatthePinosAltosmineandtheCrestonMascotadeposit,including$0.9millionon3,500metresofconversiondrillingand$2.2millionon7,500metresofexplorationdrilling.

LaIndiaMine

ConstructionbeganatLaIndiainSeptember2012andcommercialproductionwasachievedonFebruary1,2014.AtDecember31,2015,theLaIndiaminewasestimatedtocontainprovenandprobablemineralreservesof0.87millionouncesofgoldand4.08millionouncesofsilvercomprisedof30.0milliontonnesoforegrading0.90gramsofgoldpertonneand4.23gramsofsilverpertonne.


TheLaIndiapropertyconsistsof39wholly-ownedand18optionedminingconcessionsintheMulatosGoldBeltinSonora,Mexico.TheLaIndiapropertyincludestheTarachidepositandseveralotherprospectivetargetsintheMulatosGoldBelt.AttheTarachideposit,indicatedmineralresourcesare47.2milliontonnesoforegrading0.39gramsofgoldpertonneandinferredmineralresourcesare81.7milliontonnesoforegrading0.36gramsofgoldpertonne.ApreliminarymetallurgicaltestingprogramonTarachicompositesampleshasbeencompletedandnegotiationsforlandaccessareongoing.

LocationMapoftheLaIndiaMine(asatDecember31,2015)

TheMulatosGoldBeltispartoftheSierraMadregoldandsilverbeltthatalsohoststheoperatingMulatosgoldmineimmediatelysoutheastoftheLaIndiapropertyandthePinosAltosmineandtheCrestonMascotadeposit70kilometrestothesoutheast.

TheLaIndiamineislocatedinthemunicipalityofSahuaripa,southeasternSonoraState,betweenthesmallruraltownsofTarachiandMatarachi.TheclosestmajorcitywithaninternationalairportisHermosillo,thecapitalofSonora,located210kilometreswest-northwestoftheLaIndiamine.RoadtravelfromHermosillotothesitetakesapproximatelysevenhours.Alternatively,theminecanbeaccessedbysmallaircraft.ThepowersupplyattheLaIndiamineisprovidedbydieselgenerators.

TheCompanyacquiredtheLaIndiapropertyinNovember2011aspartofitsacquisitionofGrayd.Graydhadexploredthepropertysince2004andhadpreparedapreliminaryeconomicassessmentoftheprojectinDecember2010basedonaJune2010NI43-101-compliantresourceestimate.

InfilldrillingatLaIndiafromNovember2011toMay2012allowedtheCompanytoconfirmandexpandthemineralresourcesreportedintheDecember2010preliminaryeconomicassessment.InSeptember2012,followingthecompletionofafeasibilitystudy,theCompanyapprovedtheconstructionofamineatLaIndia.Themineachieved


commercialproductioninFebruary2014.TheCompanycontinuestoevaluateopportunitiestodevelopothermineralresourcesthathavebeenidentifiedintheLaIndiaarea.

TheCompanyhasengagedthelocalcommunitiesintheareawithlocalhiring,contractswithlocalbusinesses,educationsupportandmedicalsupportprogramstoensurethattheLaIndiamineprovideslongtermbenefitstotheresidentslivingandworkingintheregion.Approximately50%oftheoperatingworkforceatLaIndiaislocallyhiredand100%ofthepermanentworkforceareMexicannationals.

AttheTarachideposit,thesurfacerightsintheprojectareaareownedbytheTarachiEjido(agrariancommunity)andprivateparties.Allmeasured,indicatedandinferredmineralresourcesliewithinprivatelyownedorejidopossessedland.Surfaceaccessleaseagreementshavebeenexecutedwiththepropertyownersorpossessorsforapproximately50%oftheidentifiedtargetareas.Theexistingagreementspermitexplorationanddrillingactivities;ifminingactivityiscontemplatedinthisexplorationareatheCompanywillberequiredtonegotiatefurthertoacquirethesurfacerightsneededforprojectdevelopment.


Mining Methods

OperationsattheLaIndiamineusetraditionalopenpitminingtechniqueswithbenchheightsofsixmetresandutilizefrontendloaders,trucks,trackdrillsandvarioussupportequipment.Basedupongeotechnicalevaluations,thefinalpitslopesvarybetween45degreesand50degrees.

Surface Facilities

Thefollowingsurfaceplandetailstheplannedminelayoutshowingprojectedpitsandwasterockdumplocations,roads,theleachpadandotherinfrastructure.

SurfacePlanoftheLaIndiaMine(asatDecember31,2015)


SurfacefacilitiesattheLaIndiamineincludeathree-stageorecrushingfacility,a35milliontonnecapacitylinedheapleachpadwithprocesspondsandpumpingsystem,acarbonadsorptionplant,alaboratory,aprocessplantshop,aminingequipmentmaintenanceshop,ageneratedpowerstation,surfacepowertransmissionlinesandsubstations,awarehouse,administrativesupportofficesandcampfacilities.Thepowerforthefacilitiesissuppliedbydieselgeneratorsandwaterissuppliedbyasystemofwellsandcatchmentfacilities.Septicdischargesaremanagedintheirrespectiveleachfields.


During2015,theLaIndiaminehadpayableproductionof104,362ouncesofgoldfromapproximately5,310,000tonnesoforestackedontheheapleachpadgrading0.95gramsofgoldpertonne.ThetotalcashcostsperounceofgoldproducedatLaIndiain2015was$436onaby-productbasisand$475onaco-productbasis.Stackingratesaveraged14,715tonnesoforeperday.TheminesitecostspertonneatLaIndiawere$9in2015.

ThecumulativerecoveryforgoldontheheapleachpadatLaIndiaisapproximately55%.Heapleachrecoveryisfollowingtheexpectedcumulativerecoverycurveanditisanticipatedthattheultimategoldrecoveryof77%willbeachievedwhenleachingiscompleted.

ThefollowingtablesetsoutthemetalrecoveriesatLaIndiain2015.

Head Grade

Cumulative Metal

RecoveryPayable

Production

Gold(includingpriortocommercialproduction) 0.95g/t 55% 104,362oz

Goldproductionduring2016attheLaIndiamineisexpectedtobeapproximately100,000ouncesfrom5.3milliontonnesoforegrading0.92gramsofgoldpertonne,atestimatedtotalcashcostsperounceofapproximately$470onaby-productbasis,withestimatedcumulativegoldrecoveryof63.4%.Minesitecostspertonneofapproximately$9areexpectedin2016.


TheLaIndiamineisnotlocatedinanareawithaspecialfederalenvironmentalprotectiondesignation.AsofDecember31,2015,allpermitsnecessaryfortheoperationoftheLaIndiaminehadbeenreceived.


CapitalexpendituresattheLaIndiamineduring2015wereapproximately$19.8million,excludingcapitalizeddrilling,whichwasspentonheapleachexpansionandgeneralsustainingactivities.TheCompanyexpectscapitalexpenditurestobeapproximately$8.0millionin2016,excludingcapitalizeddrilling.Thecapitalexpendituresin2016aretobeusedforgeneralsustainingactivities.

Development

AsofDecember31,2015,fortheminelifetodate,morethan23.0milliontonnesofore,overburdenandwastehadbeenremovedfromtheopenpitmineatLaIndia.

Agreements & Licences

TheminingconcessionsfortheLaIndiamineandTarachidepositarecontrolledbyanindirect,wholly-ownedsubsidiaryoftheCompanybymeansofdirectownershipandbyfiveseparateagreementswherebytheCompanycanearna100%interestincertainconcessionsbymakingcashandsharepayments.Paymenthasbeenmadeinfullfortheclaimsthathostallofthemeasured,indicatedandinferredmineralresources.Someconcessionsaresubjecttounderlyingnetsmelterreturnroyaltiesvaryingbetween1%and3%,certainofwhichmaybepurchasedbytheCompanywhichwouldresultinnetsmelterreturnroyaltiesofupto2%remaining.

FortheTarachideposit,paymentstotaling$0.75millionoverafiveyearperiodarerequiredfortheCompanytoearna100%interestintherelevantconcessions.Todate,$0.42millionhasbeenpaidtowardtheseconcessions.Some


concessionsaresubjecttoanunderlyingnetsmelterreturnroyaltyof2%,someofwhichmaybepurchasedbytheCompany,whichwouldresultinnetsmelterreturnroyaltiesofupto1%remaining.

Inthefirstquarterof2015,theElRealitoconcession,whichliestothewestoftheMainzoneandcontainsaninlierthatextendedbetweentheMainandLaIndiazones,wasacquiredfromAlamosGoldInc.ThedefinedmineralreserveandmineralresourceandalllandsrequiredforinfrastructurefortheLaIndiaminearewholly-containedwithinthreeprivately-heldpropertieswhichtheCompanyhasacquiredinordertopermitexploration,constructionandminedevelopmentactivities.


Geology and Mineralization

TheLaIndiaminelieswithintheSierraMadreOccidental("SMO")province,anextensiveEocenetoMiocenevolcanicfieldextendingfromtheUnitedStates-MexicobordertocentralMexico.TheLaIndiaminelieswithinthewesternlimitsoftheSMOinanareadominatedbyoutcropsofandesiteanddacitictuffs,overlainbyrhyolitesandrhyolitictuffsthatwereaffectedbylarge-scalenorth-northwest-strikingnormalfaultsandintrudedbygranodioriteanddioritestocks.IncisedfluvialcanyonscuttheuppermoststrataandexposetheLowerSeriesvolcanicstrata.

Themineareaispredominantlyunderlainbyavolcanicsequencecomprisedofandesiticandfelsicextrusivevolcanicstratawithinterbeddedepiclasticstrataofsimilarcomposition.Themineraloccurrencespresentintheminearea,andthedeposittypebeingsought,arevolcanic-hostedhigh-sulphidationepithermalhydrothermalgold,silverandporphyry-relatedgolddeposits.Suchdepositsmaybepresentasveinsand/ordisseminateddepositsand/orbreccias.TheLaIndiaminedepositareaisoneofseveralhigh-sulphidationepithermalmineralizationcentresrecognizedintheregion.

Epithermalhigh-sulphidationmineralizationattheLaIndiaminedevelopedasaclusterofgoldzones(MainandNorth)alignednorth-southwithinaspatiallyrelatedzoneofhydrothermalalterationinexcessof20squarekilometresinarea.GoldmineralizationisconfinedtotheLateEocenerockswithinzonesofintermediateandadvancedargilliticalterationoriginallycontainingsulphides,andsubsequentlyoxidizedbysupergeneprocesses.TheNorthandMainzonesarewithintwokilometresofeachother.

Surfaceoutcropmappinganddrill-holedatasofarindicatethatthegoldsystemattheTarachidepositislikelybestclassifiedasagoldporphyrydeposit.


In2015,provenandprobablemineralreservesatLaIndiaincreasedbyapproximately188,000ouncesofgoldto0.87millionouncesofgold(30.0milliontonnesoforegrading0.90gramsofgoldpertonne)afterproducing104,362ouncesofgold(164,000ouncesofin-situgoldmined).Thenetincreasewasaresultoftheadditionofnewoxidereservesandtherecognitionofanewstyleoflow-grademineralizationintheMainpitthatisamenabletoheapleaching,whichmorethanoffsettheminedepletion.Thereservegoldgradeincreased6%from0.85gramsofgoldpertonneto0.90gramsofgoldpertonne.MeasuredandindicatedmineralresourcesattheLaIndiamineincreasedby15.8milliontonnesoforein2015to70.3milliontonnesoforegrading0.37gramsofgoldpertonne,largelyduetorelogging,reinterpretationandnewestimationdomains.Inferredmineralresourcesincreasedby8.3milliontonnesoforein2015to90.9milliontonnesoforegrading0.37gramsofgoldpertonneduetonewestimationdomains.

In2015,theCompanycompleted26,512metresofdrillingthrough237diamonddrillholesattheLaIndiamine.Thisincluded15,279metresofminesiteexplorationdrillingatacostof$2.47millionattheMainZoneand11,233metresofdefinition(conversion)drillingatacostof$2.9millionattheNorth,MainandLaIndiaZones.In2015,therewasalsoregionalexploration,mappingandsamplingattheArroyoHondo-KM15corridorandtheSanJavierandLasChivitasareasatacostof$0.8million.Near-mineandregionalexplorationcompletedin2015expandedthecurrentmineralresourceestimate,allowedresourceareasthathadpreviouslybeenclassifiedasinferredorindicatedmineralresourcestobeupgradedtohigherconfidenceclassificationsandprovidedseveralfollow-uptargetsfor2016exploration.

TheCompanyexpectstospendapproximately$1.97millionon7,000metresofconversiondrillingand$1.52millionon5,600metresofexplorationdrillingattheLaIndiaminein2016.Anadditional$1.3millionisplannedfor3,000metresofexplorationdrillingintheKM15area.


Regional Exploration Activities

During2015,theCompanycontinuedtoactivelyexploreinQuebec,Nunavut,Nevada,Finland,SwedenandMexico.TheCanadianregionalexplorationactivitieswerefocusedontheAmaruqandMeliadinepropertiesinNunavut.IntheUnitedStates,explorationactivitiesduring2015wereconcentratedontheWestPequopandSummitprojectslocatedinnortheastNevada.InMexico,regionalexplorationwasfocusedontheElBarqueñoproperty.InFinland,regionalexplorationwasfocusedtothenorthoftheKittilaminealongtheKiistalafaultincludingtheKuotkodeposit.InSweden,theCompanyexploredtheSolvikprojectandthenewlyacquiredBarseleproject.CanadianMalarticCorporationfocusedexplorationontheAmalgamatedKirklandandUpperBeaverprojectsnearKirklandLake,Ontario,aswellasthePandorapropertyadjacenttotheLapamine,andtheOdysseyprojectnexttotheCanadianMalarticmineinQuebec.AttheLaRonde,Goldex,Lapa,Meadowbank,Kittila,PinosAltos(includingtheCrestonMascotadeposit)andLaIndiamines,andtheCanadianMalarticmine,theCompanycontinuedexplorationprogramsaroundthemines.Mostoftheexplorationbudgetwasspentondrillingprogramsnearmineinfrastructurealongpreviouslyrecognizedgoldtrends.

Attheendof2015,theCompany'slandholdingsinCanadaconsistedof70projectscomprisedof3,839mineraltitlescoveringanaggregateof531,137hectares(ofthistotalinCanada,7projectscomprisedof1,782mineraltitlescoveringanaggregateof69,067hectaresareheldasa50%interestwithYamana,includingtheCanadianMalarticmine).LandholdingsintheUnitedStatesconsistedof5propertiescomprisedof2,494mineraltitlescoveringanaggregateof35,859hectares.LandholdingsinFinlandconsistedof3groupsofpropertiescomprisedof216mineraltitlescoveringanaggregateof27,903hectares.LandholdingsinSwedenconsistedof2projectscomprisedof29mineraltitlescoveringanaggregateof37,361hectares.LandholdingsinMexicoconsistedof18projectscomprisedof160miningconcessiontitlescoveringanaggregateof237,586hectares.

ThetotalamountofexpendituresincurredonregionalexplorationactivitiesattheCompany'sexplorationpropertiesplusheadofficeoverheadandcorporatedevelopmentactivitiesin2015was$100.2million.Thisincludeddrilling775holesforanaggregateofapproximately212kilometreson100%-ownedproperties.ItalsoincludedtheCompany's50%portionofthecostofdrilling156holesforanaggregateofapproximately82kilometresonCanadianMalarticCorporationexplorationproperties.

ThebudgetforexpendituresonregionalexplorationactivitiesattheCompany'sexplorationpropertiesplusheadofficeoverhead,projectevaluationandcorporatedevelopmentactivitiesin2016isapproximately$153million,includingapproximately345kilometresofdrillingon100%-ownedproperties,and50%ofthecostofdrilling80kilometresonCanadianMalarticCorporationexplorationproperties.Forfurtherdetailsofthecomponentsofthe2016explorationbudget,seetheCompany'snewsreleasedatedFebruary10,2016.

Mineral Reserves and Mineral Resources

InformationonMineralReservesandMineralResourcesoftheCompany

ThescientificandtechnicalinformationsetoutinthisAIFhasbeenapprovedbythefollowing"qualifiedpersons"asdefinedbyNI43-101:mineralreservesandmineralresources(otherthanfortheCanadianMalarticmine)–DanielDoucet,Eng.,SeniorCorporateDirector,ReserveDevelopment;mineralreservesandmineralresources(fortheCanadianMalarticmine)–DonaldGervais,P.Geo.,DirectorofTechnicalServicesatCanadianMalarticCorporation;environmental–LouiseGrondinP.Eng.,SeniorVice-President,Environment,SustainableDevelopmentandPeople;miningoperations,SouthernBusiness–TimHaldaneP.Eng.,SeniorVice-President,Operations–USA&LatinAmerica;metallurgy–PaulCousin,Eng.,Vice-President,Metallurgy;miningoperations,Kittilamine–FrancisBrunet,Eng.,CorporateDirectorMining;miningoperations,Nunavut–DominiqueGirard,Eng.,Vice-PresidentTechnicalServicesandNunavutOperations;andminingoperations,Quebecmines–ChristianProvencher,Eng.,Vice-President,Canada.TheCompany'smineralreservesestimatewasderivedfrominternallygenerateddataorgeologyreports.FiveoftheCompany'smineralreserveandmineralresourceestimates(Akasaba,Goldex,LaRonde,PinosAltosandLaIndia)havebeenauditedbyindependentconsultants.


Historically,mineralreservesandmineralresourcesforallpropertiesweretypicallyestimatedusinghistoricthree-yearaveragemetalspricesandforeignexchangeratesinaccordancewithSECguidelines.Theseguidelinesrequiretheuseofpricesthatreflectcurrenteconomicconditionsatthetimeofreservedetermination,whichtheStaffoftheSEChasinterpretedtomeanhistoricthree-yearaverageprices.Giventhecurrentcommoditypriceenvironment,theCompanydecidedtousepriceassumptionsthatarebelowthethree-yearaveragesforits2013,2014and2015mineralreserveandmineralresourceestimates.Theassumptionsusedforthe2015mineralreservesandmineralresourcesestimateatallminesandadvancedprojectsreportedbytheCompany(otherthantheCanadianMalarticmine)were$1,100perouncegold,$16.00perouncesilver,$0.90perpoundzinc,$2.50perpoundcopper,andexchangeratesofC$1.16per$1.00,$1.20per€1.00and14.00Mexicanpesosper$1.00forallminesandprojects(otherthantheLapaandMeadowbankminesandtheCrestonMascotadepositandSantoNiñoopenpitatPinosAltos).Duetoshorterminelife,theassumptionsusedforthemineralreserveestimatesattheshort-lifemines(theLapaandMeadowbankminesandtheCrestonMascotadepositandSantoNiñoopenpit)asofDecember31,2015,includethesamemetalpriceassumptions,andexchangeratesofC$1.30per$1.00and16.00Mexicanpesosper$1.00,respectively.Theassumptionsusedforthe2015mineralreservesandmineralresourcesestimateattheCanadianMalarticminewere$1,150perouncegold,acut-offgradebetween0.34gramspertonneand0.40gramspertonneofgold(dependingonthedeposit)andanexchangerateofC$1.24per$1.00.Theassumptionsusedforthe2014mineralreservesandmineralresourcesestimateatallminesandadvancedprojectsreportedbytheCompanyinthisAIF(otherthantheCanadianMalarticmine)were$1,150perouncegold,$18perouncesilver,$1.00perpoundzinc,$3.00perpoundcopperandexchangeratesofC$1.08per$1.00,13.00Mexicanpesosper$1.00and$1.30per€1.00.TheassumptionsusedattheCanadianMalarticminewere$1,300perouncegold,acut-offgradebetween0.28gramspertonneand0.35gramspertonneofgold(dependingonthedeposit)andanexchangerateofC$1.10per$1.00.Theassumptionsusedforthe2013mineralreservesandresourcesestimateatallminesandadvancedprojectsreportedbytheCompanywere$1,200perouncegold,$18.00perouncesilver,$0.82perpoundzinc,$3.00perpoundcopperandexchangeratesofC$1.03per$1.00,12.75Mexicanpesosper$1.00and$1.32per€1.00.Otherassumptionsusedforestimating2014and2013mineralreserveandmineralresourceinformationmaybefoundintheCompany'sannualfilingsinrespectoftheyearsendedDecember31,2014andDecember31,2013,respectively.

SetoutbelowarethemineralreserveestimatesasofDecember31,2015,ascalculatedinaccordancewithNI43-101(tonnagesandcontainedgoldquantitiesareroundedtothenearestthousand):

Property Tonnes

Gold Grade

(g/t)

Contained Gold (oz)

Proven Reserves

NorthernBusiness

LaRondemine(underground) 3,455,000 4.09 454,000

CanadianMalarticmine(openpit)(50%) 27,446,000 0.97 860,000

Lapamine(underground) 444,000 5.49 78,000

Goldexmine(underground) 300,000 1.54 15,000

Kittilamine(openpit) 176,000 3.52 20,000

Kittilamine(underground) 883,000 4.43 126,000

Kittilaminetotalproven 1,059,000 4.28 146,000

Meadowbankmine(openpit) 1,203,000 1.51 58,000

Meliadineproject(openpit) 34,000 7.31 8,000

SouthernBusiness

PinosAltosmine(openpit) 164,000 2.07 11,000

PinosAltosmine(underground) 2,605,000 3.14 263,000

PinosAltosminetotalproven 2,769,000 3.08 274,000

CrestonMascotadepositatPinosAltos(openpit) 187,000 0.68 4,000

LaIndiamine(openpit) 244,000 0.68 5,000

Total Proven Reserves 37,141,000 1.59 1,903,000


Probable Reserves

NorthernBusiness

LaRondemine(underground) 14,765,000 5.59 2,654,000

CanadianMalarticmine(openpit)(50%) 83,320,000 1.12 3,002,000

Lapamine(underground) – –

Goldexmine(underground) 12,644,000 1.61 653,000

Akasabaproject(openpit) 4,759,000 0.92 141,000

Kittilamine(openpit) 157,000 3.64 18,000

Kittilamine(underground) 26,979,000 4.83 4,189,000

Kittilaminetotalprobable 27,136,000 4.82 4,208,000

Meadowbankmine(openpit) 9,586,000 2.87 885,000

Meliadineproject(openpit) 4,001,000 5.00 644,000

Meliadineproject(underground) 10,494,000 8.20 2,766,000

Meliadineprojecttotalprobable 14,495,000 7.32 3,410,000

SouthernBusiness

PinosAltosmine(openpit) 3,440,000 2.54 281,000

PinosAltosmine(underground) 9,527,000 2.95 904,000

PinosAltosminetotalprobable 12,967,000 2.84 1,185,000

CrestonMascotadepositatPinosAltos(openpit) 4,026,000 1.33 172,000

LaIndiamine(openpit) 29,743,000 0.90 862,000

Total Probable Reserves 213,442,000 2.50 17,172,000

North total proven and probable reserves 200,646,000 2.57 16,572,000

South total proven and probable reserves 49,937,000 1.56 2,502,000

Total Proven and Probable Reserves 250,583,000 2.37 19,075,000

InthetablesaboveandbelowsettingoutmineralreserveinformationabouttheCompany'smineralprojects,andelsewhereinthisAIF,thetotalcontainedgoldouncesstateddonotincludeequivalentgoldouncesforby-productmetalscontainedinthemineralreserve.Mineralreservesarenotasubsetofmineralresources.Tonnageamountsandcontainedmetalamountspresentedinthesetableshavebeenroundedtothenearestthousand,soaggregateamountsmaydifferfromcolumntotals.TheCanadianMalarticmineralreserveandmineralresourceamountsrepresentAgnicoEagle's50%interestintheproperty.ForallmineralreservesandmineralresourcesotherthaninferredmineralresourcesandmineralreservesandmineralresourcesheldbyCanadianMalarticCorporationandthePartnership,thereportedmetalgradesintheestimatesreflectdilutionafterminingrecovery.ForthemineralreservesandmineralresourcesattheCanadianMalarticmine,thereportedmetalgradesintheestimatesofthemeasuredandindicatedmineralresourcesdonotreflectdilutionafterminingrecovery.ThemineralreserveandmineralresourcefigurespresentedinthisAIFareestimates,andnoassurancecanbegiventhattheanticipatedtonnagesandgradeswillbeachievedorthattheindicatedlevelofrecoverywillberealized.

TheintegrityandvalidityofthescientificandtechnicalinformationinthisAIFhasbeenverifiedbyQualifiedPersonsasdefinedbyNI43-101.Thisincludesthesamplingmethods,qualitycontrolmeasures,securitymeasurestakentoensure


thevalidityandintegrityofsamplestaken,assayingandanalyticalproceduresandqualitycontrolmeasuresanddataverificationprocedures.ThemethodsusedbytheCompanyfollowtheCanadianInstituteofMining,MetallurgyandPetroleum("CIM")BestPracticeGuidelinesforExplorationandforEstimationofMineralResourcesandMineralReservesandindustrypractices.SamplepreparationandanalysesareconductedbyexternallaboratoriesthatareindependentoftheCompany.

TheCompanycarriesoutmineralprocessingandmetallurgicaltestingateachofitsminesandexplorationprojects.ThetestingisdoneinaccordancewithinternalCompanyprotocolsandgoodmineralprocessingpractices.Therearenoknownprocessingfactorsordeleteriouselementsthatareexpectedtohaveasignificanteffectontheeconomicextraction,orpotentialeconomicextraction,ofgoldattheCompany'sminesoradvancedexplorationprojects.

MineralReservesandMineralResources

NorthernBusiness

LaRonde Mine Mineral Reserves and Mineral Resources

As at December 31, 2015 2014 2013

LaRonde Extension Orebody (below Level 245)

Provenmineralreserves–tonnes 2,845,000 3,600,000 4,600,000

Averagegrade–goldgramspertonne 4.43 4.03 3.79

Probablemineralreserves–tonnes 14,706,000 16,000,000 17,800,000


LaRonde Orebody (above Level 245)

Provenmineralreserves–tonnes 610,000 900,000 1,400,000


Probablemineralreserves–tonnes 59,000 100,000 300,000


Total proven and probable mineral reserves – tonnes 18,220,000 20,532,000 24,100,000

Average grade – gold grams per tonne 5.31 5.20 5.00

Total contained gold ounces 3,109,000 3,432,000 3,880,000

Notes:

(1) The2015provenandprobablemineralreserveestimatessetoutinthetableabovearebasedonanetsmelterreturncut-offvalueoftheorethatvariesbetweenC$104pertonneandC$115pertonnedependingonthedeposit.Goldcut-offgradesusedforresourceestimateswerefixedat75%oftheapplicablereservecut-offgrade.TheCompany'shistoricalmetallurgicalrecoveryratesattheLaRondeminefromJanuary1,2010toDecember31,2015averaged91.8%forgold,86.7%forsilver,81.5%forzincand80.8%forcopper.SinceMay2013,whenthepreciousmetalscircuitwasupgradedtocarbon-in-pulptechnology,themetallurgicalrecoveryratestoDecember31,2015haveaveraged94.5%forgold,86.0%forsilver,73.3%forzinc,84.0%forcopper,and0%forlead(leadhasnotbeenrecoveredsinceMay2013).ThehistoricalmetallurgicalrecoveryrateforleadfromJanuary1,2010toDecember31,2015was12.63%.TheCompanyestimatesthata$100(9%)changeinthegoldpricewouldresultinanapproximate1%changeinmineralreserves.

(2) Inadditiontothemineralreservessetoutabove,atDecember31,2015,theLaRondeminecontainedindicatedmineralresourcesof6,842,000tonnesoforegrading3.49gramsofgoldpertonneandinferredmineralresourcesof9,142,000tonnesoforegrading4.26gramsofgoldpertonne.


(3) Thefollowingtablesetsoutthereconciliationofmineralreserves(roundedtothenearestthousandtonnes)attheLaRondeminebycategoryatDecember31,2015withthoseatDecember31,2014.Revisionindicatesadditionalmineralreservesconvertedfrommineralresourcesorothercategoriesofmineralreservesandmineralreservesaddedfromexplorationactivitiesduring2015.

Proven Probable Total

December31,2014 4,460 16,072 20,532

Processedin2015 2,241 – 2,241

Revision 1,236 (1,307) (71)

December 31, 2015 3,455 14,765 18,220

(4) Completeinformationontheverificationprocedures,thequalityassuranceprogram,qualitycontrolprocedures,expectedpaybackperiodofcapital,parametersandmethodsandotherfactorsthatmaymateriallyaffectscientificandtechnicalinformationpresentedinthisAIFrelatingtotheLaRondeminemaybefoundintheTechnicalReportonthe2005LaRondeMineralResource&MineralReserveEstimatefiledwithCanadiansecuritiesregulatoryauthoritiesonSEDARonMarch23,2005andauthoredbyGuyGosselin,Eng.

Lapa Mine Mineral Reserves and Mineral Resources

As at December 31, 2015 2014 2013

Gold

Provenmineralreserves–tonnes 444,000 832,000 1,011,000


Probablemineralreserves–tonnes – 74,000 456,000

Averagegrade–goldgramspertonne – 5.50 5.92

Total proven and probable mineral reserves – tonnes 444,000 907,000 1,466,000


Total contained gold ounces 78,000 170,000 281,000

Notes:

(1) The2015provenandprobablemineralreserveestimatessetoutinthetableabovewerecalculatedusinganassumedmetallurgicalgoldrecoveryof80.50%andacut-offgradeof3.6gramsofgoldpertonne,andtheresourceestimateswerecalculatedusinganassumedmetallurgicalgoldrecoveryof73.4%andacut-offgradeof3.0gramsofgoldpertonne.Goldcut-offgradesusedforresourceestimateswerefixedat75%oftheapplicablereservecut-offgrade.TheoperatingcostpertonneestimatefortheLapaminein2015wasC$133.05.TheCompanyestimatesthata$100(9%)increaseordecreaseinthegoldpricewouldresultinanapproximate10%increaseor0%decrease,respectively,inmineralreserves.

(2) Inadditiontothemineralreservessetoutabove,atDecember31,2015,theLapaminecontainedmeasuredmineralresourcesof49,000tonnesoforegrading5.33gramsofgoldpertonne,indicatedmineralresourcesof1,086,000tonnesoforegrading4.21gramsofgoldpertonneandinferredmineralresourcesof1,440,000tonnesoforegrading6.52gramsofgoldpertonne.

(3) Thefollowingtablesetsoutthereconciliationofmineralreserves(roundedtothenearestthousandtonnes)attheLapaminebycategoryatDecember31,2015withthoseatDecember31,2014.Revisionindicatesadditionalmineralreservesconvertedfrommineralresourcesorothercategoriesofmineralreservesandmineralreservesaddedfromexplorationactivitiesduring2015.


December31,2014 832 74 907

Processedin2015 560 – 560

Revision 172 (74) 98

December 31, 2015 444 – 444

(4) Completeinformationontheverificationprocedures,thequalityassuranceprogram,qualitycontrolprocedures,expectedpaybackperiodofcapital,parametersandmethodsandotherfactorsthatmaymateriallyaffectscientificandtechnicalinformationpresentedinthisAIFrelatingtotheLapaminemaybefoundintheTechnicalReportontheLapaGoldProject,CadillacTownship,Quebec,CanadafiledwithCanadiansecuritiesregulatoryauthoritiesonSEDARonJune8,2006.


Goldex Mine Mineral Reserves and Mineral Resources

As at December 31, 2015 2014 2013

Gold

Provenmineralreserves–tonnes 300,000 203,000 119,000







Notes:

(1) The2015provenandprobablemineralreserveestimatessetoutinthetableabovewereestimatedusinganassumedmetallurgicalgoldrecoveryof89.40%.In2015,theminesitecostspertonnewereestimatedtobeC$36.00fortheEandMZones.Thecut-offgradeusedformineralreserveswas1.04gramsofgoldpertonne.Goldcut-offgradesusedformineralresourceestimateswerefixedat75%oftheapplicablereservecut-offgrade.TheCompanyestimatesthata$100(9%)increaseordecreaseinthegoldpricewouldresultinanapproximate0%increaseor4%decrease,respectively,inmineralreserves.

(2) Inadditiontothemineralreservessetoutabove,atDecember31,2015,theGoldexminecontainedmeasuredmineralresourcesof12,360,000tonnesoforegrading1.86gramsofgoldpertonne,indicatedmineralresourcesof22,069,000tonnesoforegrading1.88gramsofgoldpertonneandinferredmineralresourcesof24,630,000tonnesoforegrading1.53gramsofgoldpertonne.

(3) Thefollowingtablesetsoutthereconciliationofmineralreserves(roundedtothenearestthousandtonnes)attheGoldexminebycategoryatDecember31,2015withthoseatDecember31,2014.Revisionindicatesadditionalmineralreservesconvertedfrommineralresourcesorothercategoriesofmineralreserves,anupdatetomineralreservesbasedonchangedmineplansandmineralreservesaddedfromexplorationactivitiesduring2015.


December31,2014 203 6,893 7,096

Processedin2015 2,313 – 2,313

Revision 2,410 5,751 8,161

December 31, 2015 300 12,644 12,944

(4) Completeinformationontheverificationprocedures,thequalityassuranceprogram,qualitycontrolprocedures,expectedpaybackperiodofcapital,parametersandmethodsandotherfactorsthatmaymateriallyaffectscientificandtechnicalinformationpresentedinthisAIFrelatingtotheGoldexminemaybefoundintheTechnicalReportonProductionoftheMandEZonesatGoldexMinedatedOctober14,2012filedwiththeCanadiansecuritiesregulatoryauthoritiesonSEDARonNovember1,2012,authoredbyRichardGenest,P.Geo.,ing.,Jean-FrançoisLagueux,ing.,FrançoisRobichaud,ing.andSylvainBoily,ing.


Canadian Malartic Mineral Reserves and Mineral Resources (Agnico Eagle's 50% Interest)

As at December 31, 2015 2014

Gold

Provenmineralreserves–tonnes 27,446,000 24,969,000

Averagegrade–goldgramspertonne 0.97 0.92

Probablemineralreserves–tonnes 83,320,000 101,978,000

Averagegrade–goldgramspertonne 1.12 1.10

Total proven and probable mineral reserves – tonnes 110,766,000 126,947,000

Average grade – gold grams per tonne 1.08 1.06

Total contained gold ounces 3,863,000 4,329,000

Notes:

(1) TheCanadianMalarticpropertyisownedbythePartnership,inwhichtheCompanyholdsanindirect50%interest,withtheremaining50%interestheldindirectlybyYamana.The2015provenandprobablemineralreserveestimatessetoutinthetableabovewerecalculatedusinganassumedmetallurgicalgoldrecoveryofbetween82.0%and90.1%andacut-offgradefrom0.34to0.40gramsofgoldpertonne,dependingonthedeposit.Goldcut-offgradesusedforresourceestimateswerefixedat100%oftheapplicablereservecut-offgradeinpitand1.0gramsofgoldpertonneforresourcesbelowpit.TheoperatingcostpertonnemilledestimatefortheCanadianMalarticminein2015wasC$20.24.TheCompanyestimatesthata$150decreaseinthegoldpriceto$1,000perouncewouldresultinanapproximate9%decreaseinmineralreserves,whilea$50increaseinthegoldpriceto$1,200perouncewouldresultinanapproximate2%increaseinmineralreserves.

(2) Inadditiontothemineralreservessetoutabove,atDecember31,2015,theCanadianMalarticmine(AgnicoEagle's50%interest)containedmeasuredmineralresourcesof1,752,000tonnesoforegrading1.32gramsofgoldpertonne,indicatedmineralresourcesof11,079,000tonnesoforegrading1.55gramsofgoldpertonneandinferredmineralresourcesof4,494,000tonnesoforegrading1.47gramsofgoldpertonne.

(3) Thefollowingtablesetsoutthereconciliationofmineralreserves(innearestthousandtonnes)attheCanadianMalarticminebycategoryatDecember31,2015withthoseatDecember31,2014,statingAgnicoEagle's50%interest.Revisionindicatesadditionalmineralreservesconvertedfrommineralresourcesduring2015.


December31,2014 24,969 101,978 126,947

Processedin2015 9,545 – 9,545

Revision 12,022 (18,658) (6,636)

December 31, 2015 27,446 83,320 110,766

(4) Completeinformationontheverificationprocedures,thequalityassuranceprogram,qualitycontrolprocedures,expectedpaybackperiodofcapital,parametersandmethodsandotherfactorsthatmaymateriallyaffectscientificandtechnicalinformationpresentedinthisAIFrelatingtotheCanadianMalarticminemaybefoundintheTechnicalReportontheMineralResourceandMineralReserveEstimatesfortheCanadianMalarticPropertydatedJune16,2014,filedwithCanadiansecuritiesregulatoryauthoritiesonSEDARonAugust13,2014,authoredbyDonaldGervais,P.Geo.,ChristianRoy,Eng.,AlainThibault,Eng.,CarlPednault,Eng.andDanielDoucet,Eng.


Kittila Mine Mineral Reserves and Mineral Resources

As at December 31, 2015 2014 2013

Gold

Provenmineralreserves–tonnes 1,059,000 921,000 1,104,000







Notes:

(1) The2015provenandprobablemineralreserveestimatessetoutinthetableabovewerecalculatedusingametallurgicalgoldrecoveryof87.1%.Goldcut-offgradesusedwere2.22gramspertonne,undiluted(1.97gramspertonne,diluted)foropenpitmineralreservesandbetween3.39gramspertonneand3.71gramspertonne,undiluted(between2.87gramspertonneand3.18gramspertonne,diluted),dependingonthedeposit,forundergroundmineralreserves.Goldcut-offgradesusedformineralresourceestimateswerefixedat75%oftheapplicablereservecut-offgrade.Theopenpitoperatingcostwasestimatedtobe€49.41pertonnein2015,whiletheundergroundcostaveraged€75.88pertonnein2015.TheCompanyestimatesthata$100(9%)increaseordecreaseinthegoldpricewouldresultinanapproximate14%increaseor5%decrease,respectively,inmineralreserves.

(2) Inadditiontothemineralreservessetoutabove,atDecember31,2015,theKittilaminecontainedmeasuredmineralresourcesof991,000tonnesoforegrading2.58gramsofgoldpertonne,indicatedmineralresourcesof14,935,000tonnesoforegrading3.05gramsofgoldpertonneandinferredmineralresourcesof11,833,000tonnesoforegrading4.64gramsofgoldpertonne.

(3) ThebreakdownofprovenandprobablemineralreservesbetweenplannedopenpitoperationsandundergroundoperationsattheKittilamine(withtonnageandcontainedouncesroundedtothenearestthousand)atDecember31,2015is:

Category Mining Method Tonnes

Gold Grade

(g/t)

Contained Gold (oz)

Provenmineralreserves Openpit 176,000 3.52 20,000

Provenmineralreserves Underground 883,000 4.43 126,000

Total proven mineral reserves 1,059,000 4.28 146,000

Probablemineralreserves Openpit 157,000 3.64 18,000

Probablemineralreserves Underground 26,979,000 4.83 4,189,000

Total probable mineral reserves 27,136,000 4.82 4,208,000

(4) Thefollowingtablesetsoutthereconciliationofmineralreserves(innearestthousandtonnes)attheKittilaminebycategoryatDecember31,2015withthoseatDecember31,2014.Revisionindicatesadditionalmineralreservesconvertedfrommineralresourcesorothercategoriesofmineralreservesandmineralreservesaddedfromexplorationactivitiesduring2015.


December31,2014 921 27,614 28,535

Processedin2015 1,464 – 1,464

Revision 1,602 (478) 1,124

December 31, 2015 1,059 27,136 28,195

(5) Completeinformationontheverificationprocedures,thequalityassuranceprogram,qualitycontrolprocedures,expectedpaybackperiodofcapital,parametersandmethodsandotherfactorsthatmaymateriallyaffectscientificandtechnicalinformationpresentedinthisAIFrelatingtotheKittilaminemaybefoundintheTechnicalReportontheDecember31,2009,MineralResourceandMineralReserveEstimateandtheSuuriExtensionProject,KittilaMine,Finland,filedwiththeCanadiansecuritiesregulatoryauthoritiesonSEDARonMarch4,2010,authoredbyDanielDoucet,Ing.,DominiqueGirard,Ing.,LouiseGrondin,P.Eng.,Ing.andPierreMatte,Ing.


Meadowbank Mine Mineral Reserves and Mineral Resources

As at December 31, 2015 2014 2013

Gold

Provenmineralreserves–tonnes 1,203,000 1,090,000 1,128,000






Total contained gold ounces 943,000 1,168,000 1,751,000

Notes:

(1) The2015provenandprobablemineralreserveestimatessetoutinthetableabovewerecalculatedusingacut-offgradethatusedametallurgicalgoldrecoveryof95.5%or90.5%,dependingonthedeposit.Theeconomiccut-offgradeusedtodeterminemineralreservesvariedfrom1.27gramsofgoldpertonneto1.38gramsofgoldpertonne,dependingonthedeposit,andis0.94to1.15gramsofgoldpertonneasamarginalcut-offgrade,dependingonthedeposit.Goldcut-offgradesusedforresourceestimateswerefixedat75%oftheapplicablereservecut-offgrade.Theestimatedorebasedoperatingcostsusedforthe2015mineralreserveestimatevariedbetweenC$55.72pertonneandC$56.60pertonne,dependingonthedeposit,withanadditionalhaulagecostofC$0.88pertonneforVaultdepositmineralreserves.TheCompanyestimatesthata$100(9%)changeinthegoldpricewouldresultinanapproximate2%changeinmineralreserves.

(2) Inadditiontothemineralreservessetoutabove,atDecember31,2015,theMeadowbankminecontainedmeasuredmineralresourcesof0.74milliontonnesoforegrading1.01gramsofgoldpertonne,indicatedmineralresourcesof6.2milliontonnesoforegrading3.48gramsofgoldpertonneandinferredmineralresourcesof3.4milliontonnesoforegrading3.99gramsofgoldpertonne.

(3) Thefollowingtablesetsoutthereconciliationofmineralreserves(roundedtothenearestthousandtonnes)attheMeadowbankminebycategoryatDecember31,2015withthoseatDecember31,2014.Revisionindicatesadditionalmineralreservesconvertedfrommineralresourcesorothercategoriesofmineralreserves,anupdatetomineralreservesbasedonchangedmineplans,andmineralreservesaddedfromexplorationactivitiesduring2015.


December31,2014 1,090 10,705 11,795

Processedin2015 4,033 – 4,033

Revision 4,146 (1,119) 3,027

December 31, 2015 1,203 9,586 10,789

(4) Completeinformationontheverificationprocedures,thequalityassuranceprogram,qualitycontrolprocedures,expectedpaybackperiodofcapital,parametersandmethodsandotherfactorsthatmaymateriallyaffectscientificandtechnicalinformationpresentedinthisAIFrelatingtotheMeadowbankminemaybefoundintheTechnicalReportontheMineralResourcesandMineralReservesatMeadowbankGoldMine,Nunavut,CanadaasatDecember31,2011filedwithCanadiansecuritiesregulatoryauthoritiesonSEDARonMarch23,2012,authoredbyMarcRuel,P.Geo.,AlexProulx,ing.,PathiesNawejMuteb,ing.andLarryConnell,P.Eng.


Meliadine Project Mineral Reserves and Mineral Resources

As at December 31, 2015 2014 2013

Gold








Notes:

(1) The2015provenandprobablemineralreserveestimatessetoutinthetableabovewerecalculatedusingmetallurgicalgoldrecoverycurvesfortheTiriganiaqandWesmegdeposits.Thecurvesgiveamaximumrecoveryof96.5%forTiriganiaqandWesmeg.The2015mineralresourceestimatesforTiriganiaq-Normeg-Wesmeg,FZone,Pump,DiscoveryandWolfdepositswerecalculatedusingafixedmetallurgicalgoldrecoveryof91.1%,91.0%,86.9%,93.5%and94.3%,respectively,foropenpitresources,and93.37%,91.67%,90.0%,95.46%and95.7%,respectively,forundergroundresources.FortheTiriganiaqandWesmegdeposits,thecut-offgradeusedtodeterminetheopenpitmineralreserveswas2.50gramsofgoldpertonne,undiluted(1.76gramsofgoldpertonne,diluted),andthecut-offgradeusedtodeterminetheundergroundmineralreserveswas6.07gramsofgoldpertonne,undiluted(4.67gramsofgoldpertonne,diluted).Goldcut-offgradesusedformineralresourceestimateswerefixedat75%oftheapplicablereservecut-offgradeforundergroundresourceestimatesandat100%oftheapplicablereservemarginalcut-offgradeforopenpitmineralresourceestimates.Theestimatedoperatingcostusedforthe2015mineralreserveestimatewasC$81.97pertonneforopenpitandC$176.44pertonneforunderground.TheCompanyestimatesthata$100(9%)increaseordecreaseinthegoldpricewouldresultinanapproximate5%increaseor7%decrease,respectively,inmineralreserves.

(2) Inadditiontothemineralreservessetoutabove,atDecember31,2015,theMeliadineprojectcontainedindicatedmineralresourcesof20,778,000tonnesoforegrading4.95gramsofgoldpertonneandinferredmineralresourcesof14,710,000tonnesoforegrading7.51gramsofgoldpertonne.

(3) ThebreakdownofmineralreservesbetweencontemplatedopenpitoperationsandundergroundoperationsattheMeliadineproject(withtonnageandcontainedouncesroundedtothenearestthousand)atDecember31,2015is:


Gold Grade

(g/t)

Contained Gold (oz)

Provenmineralreserves Openpitstockpile 34,000 7.31 8,000

Probablemineralreserves Openpit 4,001,000 5.00 644,000

Probablemineralreserves Underground 10,494,000 8.20 2,766,000

Total probable mineral reserves 14,495,000 7.32 3,410,000

Total proven and probable mineral reserves 14,529,000 7.32 3,417,000

(4) Completeinformationontheverificationprocedures,thequalityassuranceprogram,qualitycontrolprocedures,expectedpaybackperiodofcapital,parametersandmethodsandotherfactorsthatmaymateriallyaffectscientificandtechnicalinformationpresentedinthisAIFrelatingtotheMeliadineprojectmaybefoundintheUpdatedTechnicalReportontheMeliadineGoldProject,Nunavut,CanadadatedFebruary11,2015,filedwithCanadiansecuritiesregulatoryauthoritiesonMarch12,2015,authoredbyJulieLarouche,P.Geo.,DenisCaron,ing.,LarryConnell,P.Eng.,DanyLaflamme,ing.,FrançoisRobichaud,ing.,FrançoisPetrucci,ing.P.Eng.andAlexandreProulx,ing.


SouthernBusiness

Pinos Altos Mine Mineral Reserves and Mineral Resources

As at December 31, 2015 2014 2013

Gold and Silver Provenmineralreserves–tonnes 2,769,000 2,441,000 1,966,000

Averagegoldgrade–gramspertonne 3.08 3.27 2.54

Averagesilvergrade–gramspertonne 82.51 86.27 82.17



Averagesilvergrade–gramspertonne 72.40 78.63 63.00


Average gold grade – grams per tonne 2.88 3.01 2.46

Average silver grade – grams per tonne 74.18 79.65 64.32


Total contained silver ounces 37,531,000 46,682,000 59,354,000

Notes:

(1) Themineralreservesintheabovetablefor2013includebothPinosAltosandtheCrestonMascotadepositatPinosAltos.Themineralreservesfor2014and2015includeonlythePinosAltosmine.TheCrestonMascotadepositatPinosAltosmineralreservesarenowshownseparately,immediatelyfollowingthissection.

(2) The2015provenandprobablemineralreserveestimatessetoutinthetableaboveatthePinosAltosmine(excludingtheCrestonMascotadeposit)arebasedonanetsmelterreturncut-offvalueoftheopenpitorebetween$12.50pertonneand$31.24pertonne,dependingontheprocessingmethod,andanetsmelterreturncut-offvalueoftheundergroundoreof$60.44pertonne.Goldcut-offgradesusedforresourceestimateswerefixedat75%oftheapplicablereservecut-offgrade.Theestimatedoperatingcostusedforthe2015mineralreserveestimatewas$55.42pertonne.Themetallurgicalgoldrecoveryusedinthereserveestimatesvariedbetween72%and95.6%,dependingonthedepositandtheprocessingmethod.Themetallurgicalsilverrecoveryusedinthereserveestimatesvariedbetween14%and44.6%,dependingonthedepositandtheprocessingmethod.TheCompanyestimatesthata$100(9%)changeinthegoldpricewouldresultinanapproximate3%changeinmineralreserves.

(3) Inadditiontothemineralreservessetoutabove,atDecember31,2015,thePinosAltosminecontainedindicatedmineralresourcesof11,141,000tonnesoforegrading1.83gramsofgoldpertonneand42.43gramsofsilverpertonneandinferredmineralresourcesof12,580,000tonnesoforegrading1.25gramsofgoldpertonneand29.33gramsofsilverpertonne.

(4) ThebreakdownofmineralreservesbetweenplannedopenpitoperationsandundergroundoperationsatthePinosAltosmine(withtonnageandcontainedouncesroundedtothenearestthousand)atDecember31,2015is:


Gold Grade

(g/t)

Silver Grade

(g/t)

Contained Gold (oz)

Contained Silver

(oz)

Provenmineralreserves Openpitstockpile 164,000 2.07 67.48 11,000 355,000

Provenmineralreserves Underground 2,605,000 3.14 83.46 263,000 6,991,000

Total proven mineral reserves 2,769,000 3.08 82.51 274,000 7,345,000

Probablemineralreserves Openpit 3,440,000 2.54 71.21 281,000 7,875,000

Probablemineralreserves Underground 9,527,000 2.95 72.83 904,000 22,310,000

Total probable mineral reserves 12,967,000 2.84 72.40 1,185,000 30,186,000

Total proven and probable mineral reserves 15,736,000 2.88 74.18 1,459,000 37,531,000

(5) Thefollowingtablesetsoutthereconciliationofmineralreserves(innearestthousandtonnes)atthePinosAltosmine(excludingtheCrestonMascotadeposit)bycategoryatDecember31,2015withthoseatDecember31,2014.Revisionindicatesadditionalmineralreservesconvertedfrommineralresourcesorothercategoriesofmineralreservesandmineralreservesaddedfromexplorationactivitiesduring2015.


December31,2014 2,441 15,788 18,230

Processedin2015 2,378 – 2,378

Revision 2,706 (2,821) (116)

December 31, 2015 2,769 12,967 15,736

(6) Completeinformationontheverificationprocedures,thequalityassuranceprogram,qualitycontrolprocedures,expectedpaybackperiodofcapital,parametersandmethodsandotherfactorsthatmaymateriallyaffectscientificandtechnicalinformationpresentedinthisAIFrelatingtothePinosAltosminemaybefoundinthePinosAltosGold-SilverMiningProject,ChihuahuaState,Mexico,TechnicalReportontheMineralResourcesandReservesasofDecember31,2008filedwiththeCanadiansecuritiesregulatoryauthoritiesonSEDARonMarch25,2009,authoredbyDyaneDuquette,Geo.,LouiseGrondin,P.Eng.,PierreMatte,Eng.andCamilPrince,Eng.

Creston Mascota Deposit at Pinos Altos Mineral Reserves and Mineral Resources

As at December 31, 2015 2014 2013

Gold and Silver Provenmineralreserves–tonnes 187,000 187,000 –

Averagegoldgrade–gramspertonne 0.68 0.76 –

Averagesilvergrade–gramspertonne 8.05 8.60 –

Probablemineralreserves–tonnes 4,026,000 5,657,000 –

Averagegoldgrade–gramspertonne 1.33 1.27 –


Total proven and probable mineral reserves – tonnes 4,213,000 5,844,000 –

Average gold grade – grams per tonne 1.30 1.25 –

Average silver grade – grams per tonne 12.02 13.47 –

Total contained gold ounces 176,000 236,000 –

Total contained silver ounces 1,628,000 2,530,000 –

Notes:

(1) Themineralreservesintheabovetablefor2014and2015includeonlytheCrestonMascotadepositatPinosAltos.Priorto2014theCrestonMascotadepositatPinosAltosmineralreserveswereshowncombinedwiththemineralreservesfromthePinosAltosmine,immediatelyprecedingthissection.

(2) The2015provenandprobablemineralreserveestimatessetoutinthetableaboveattheCrestonMascotadepositatPinosAltosarebasedonanetsmelterreturncut-offvalueoftheopenpitoreof$9.95pertonne.Goldcut-offgradesusedforresourceestimateswerefixedat75%oftheapplicablereservecut-offgrade.TheoperatingcostpertonneestimatefortheCrestonMascotadepositatPinosAltosin2015was$12.16actualversus$15.09budgeted.Themetallurgicalgoldrecoveryusedinthereserveestimateswas65%.Themetallurgicalsilverrecoveryusedinthereserveestimateswas16%.TheCompanyestimatesthata$100(9%)changeinthegoldpricewouldresultin0%changeinmineralreserves.

(3) Inadditiontothemineralreservessetoutabove,atDecember31,2015,theCrestonMascotadepositatPinosAltoscontainedindicatedmineralresourcesof4,264,000tonnesoforegrading0.51gramsofgoldpertonneand5.14gramsofsilverpertonneandinferredmineralresourcesof4,263,000tonnesoforegrading1.06gramsofgoldpertonneand14.16gramsofsilverpertonne.

(4) Thefollowingtablesetsoutthereconciliationofmineralreserves(roundedtothenearestthousandtonnes)atthetheCrestonMascotadeposit)bycategoryatDecember31,2015withthoseatDecember31,2014.Revisionindicatesadditionalmineralreservesconvertedfrommineralresourcesorothercategoriesofmineralreservesandmineralreservesaddedfromexplorationactivitiesduring2015.


December31,2014 187 5,657 5,844

Processedin2015 2,099 – 2,099

Revision 2,099 (1,631) 468

December 31, 2015 187 4,026 4,213


(5) Completeinformationontheverificationprocedures,thequalityassuranceprogram,qualitycontrolprocedures,expectedpaybackperiodofcapital,parametersandmethodsandotherfactorsthatmaymateriallyaffectscientificandtechnicalinformationpresentedinthisAIFrelatingtotheCrestonMascotadepositatPinosAltosmaybefoundinthePinosAltosGold-SilverMiningProject,ChihuahuaState,Mexico,TechnicalReportontheMineralResourcesandReservesasofDecember31,2008filedwiththeCanadiansecuritiesregulatoryauthoritiesonSEDARonMarch25,2009,authoredbyDyaneDuquette,Geo.,LouiseGrondin,P.Eng.,PierreMatte,Eng.andCamilPrince,Eng.

La India Mine Mineral Reserves and Mineral Resources

As at December 31, 2015 2014 2013

Gold








Average gold grade – grams per tonne 0.90 0.85 0.87

Average silver grade – grams per tonne 4.23 6.07 –


Total contained silver ounces 4,081,000 4,859,000 –

Notes:

(1) The2015provenandprobablemineralreserveestimatessetoutinthetableabovefortheLaIndiamine(includingtheTarachideposit)werecalculatedusinganaveragemetallurgicalgoldrecoveryof40%to92%dependingonthezone.Theeconomiccut-offgradeusedtodeterminemineralreservesvarieddependingondomainfrom0.27gramsofgoldpertonneto0.62gramsofgoldpertonne.Marginalcut-offgradesvarieddependingondomainfrom0.15gramsofgoldpertonneto0.34gramsofgoldpertonne.Goldcut-offgradesusedforresourceestimateswerefixedat75%oftheapplicablereservecut-offgrade.Theestimatedoperatingcostusedforthe2015mineralreserveestimatewas$8.44pertonne.TheCompanyestimatesthata$100(9%)increaseordecreaseinthegoldpricewouldresultinanapproximate8%increaseor7%decrease,respectively,inmineralreserves.

(2) Inadditiontothemineralreservessetoutabove,atDecember31,2015,theLaIndiamine(includingtheTarachideposit)containedmeasuredmineralresourcesof8,339,000tonnesoforegrading0.25gramsofgoldpertonneand2.48gramsofsilverpertonne,indicatedmineralresourcesof61,950,000tonnesoforegrading0.38gramsofgoldpertonne,andinferredmineralresourcesof90,868,000tonnesoforegrading0.37gramsofgoldpertonne.

(3) Thefollowingtableshowsthereconciliationofmineralreserves(roundedtothenearestthousandtonnes)attheLaIndiaminebycategoryatDecember31,2015withthoseatDecember31,2014.Revisionmeansadditionalmineralreservesconvertedfrommineralresourcesorothercategoriesofmineralreservesandmineralreservesaddedfromexplorationactivitiesandmetallurgicaltestingduring2015.


December31,2014 99 24,783 24,882

Processedin2015 5,371 – 5,371

Revision 5,516 4,960 10,476

December 31, 2015 244 29,743 29,987

(4) Completeinformationontheverificationprocedures,thequalityassuranceprogram,qualitycontrolprocedures,expectedpaybackperiodofcapital,parametersandmethodsandotherfactorsthatmaymateriallyaffectscientificandtechnicalinformationpresentedinthisAIFrelatingtotheLaIndiamineprojectmaybefoundintheTechnicalReportontheJune30,2012UpdateoftheMineralResourcesandMineralReserves,LaIndiaGoldProject,MunicipalityofSahuaripa,Sonora,Mexico,datedAugust31,2012,filedwiththeCanadiansecuritiesregulatoryauthoritiesonSEDARonOctober12,2012,authoredbyDanielDoucet,ing.,TimHaldane,P.Eng.andMichelJulien,P.Eng.

Principal Products and Distribution

TheCompanyearnssubstantiallyallofitsrevenueandcashflowfromtheproductionandsaleofgoldinbothdorebarandconcentrateform.Theremainderofrevenueandcashflowisgeneratedfromtheproductionandsaleofby-productmetals,namelysilver,zincandcopper.ThegoldproducedbytheCompanyissoldinrefinedform,primarilyintheLondonspotmarket.TheCompanyisnotdependentonanyparticularpurchaserofitsprincipalproduct.

Employees

AsofDecember31,2015,theCompanyhad7,588employeescomprisedof5,093permanentemployees,1,824contractors,599temporaryemployeesand72students.Ofthepermanentemployees,842wereemployedattheLaRondemine,165attheLapamine,283attheGoldexmine,687attheCanadianMalarticmine(withanadditional48intheCanadianMalarticoffice),371attheKittilamine(withanadditional10attheFinnishexplorationgroup),689attheMeadowbankmine(with2attheBakerLakeofficeand12inQuebec),17attheMeliadineproject,988atthePinosAltosmine,257attheCrestonMascotadepositatPinosAltos,368attheLaIndiamine,18intheexplorationgroupinCanadaandtheUnitedStates,67intheexplorationgroupinMexico,133attheregionaltechnicalofficeinAbitibi,6attheregionalofficeinTucsonand130atthecorporateheadofficeinToronto.ThenumberofpermanentemployeesoftheCompanyattheendof2015,2014and2013was5,093,5,187and4,259,respectively.

Competitive Conditions

Thepreciousmetalexplorationandminingbusinessisahighlycompetitivebusiness.TheCompanycompeteswithotherminingandexplorationcompaniesinconnectionwiththeacquisitionofminingclaimsandleases,thesourcingofrawmaterialsandsuppliesusedinconnectionwithminingoperationsandtherecruitmentandretentionofqualifiedemployees.

TheabilityoftheCompanytocontinueitsminingbusinessinthefuturewilldependnotonlyonitsabilitytodevelopitscurrentproperties,butalsoonitsabilitytoselectandacquiresuitableproducingpropertiesorprospectsforpreciousmetaldevelopmentorexploration.See"RiskFactors"foradescriptionofadditionalcompetitiveriskstheCompanyfaces.

Sustainable Development

In2015,theCompanycontinuedtheprocessofincorporatinghealth,safetyandenvironmentalsustainabilityintoallaspectsandstagesofitsbusiness,fromthecorporateobjectivesandexecutiveresponsibilityof'maintaininghighstandardsinsustainability'toexplorationandacquisitionactivities,daytodayoperatingandsiteclosure.Thisintegrationbeganin2012withtheadoptionofanintegratedHealth,Safety,EnvironmentandSocialAcceptabilityPolicy(the"SustainableDevelopmentPolicy")thatreflectstheCompany'scommitmenttoresponsibleminingpractices.TheSustainableDevelopmentPolicyreplacedtheCompany'spreviousenvironmentalandhealthandsafetypolicies.TheCompanybelievesthattheSustainableDevelopmentPolicywillleadtotheachievementofmoresustainablepracticesthroughoversightandaccountability.

TheSustainableDevelopmentPolicyoperatesthroughthedevelopmentandimplementationofaformalandintegratedHealth,SafetyandEnvironmentalManagementSystem,termedtheResponsibleMiningManagementSystem(the"RMMS"),acrossalldivisionsoftheCompany.ThePartnershiphascommittedtoimplementingtheRMMSatCanadianMalarticinthefuture.TheaimoftheRMMSistofurtherpromoteacultureofaccountabilityandleadershipinmanaginghealth,safety,environmentalandsocialacceptabilitymatters.RMMSimplementationissupportedbysoftwarewidelyusedintheCanadianminingindustrythatisconsistentwiththeISO14001EnvironmentalManagementSystemandtheOHSAS18001HealthandSafetyManagementSystem.

TheRMMSincorporatestheCompany'scommitmentsasasignatorytotheInternationalCyanideManagementCode(the"CyanideCode"),avoluntaryprogramthataddressesthesafeproduction,transport,storage,handlinganddisposalofcyanide.TheCompanybecameasignatorytotheCyanideCodeinSeptember2011.Externalauditswereperformedin2014byanindependentthirdpartyandcertificationwasreceivedforKittila,PinosAltosandMeadowbank.

TheRMMSalsointegratestherequirementsoftheMiningAssociationofCanada'sindustry-leadingTowardsSustainableMiningInitiative(the"TSMInitiative"),aswellastheGlobalReportingInitiative'ssustainabilityreportingguidelinesfortheminingindustry.InDecember2010,theCompanybecameamemberoftheMiningAssociationofCanadaandendorsedtheTSMInitiative.TheTSMInitiativewasdevelopedtohelpminingcompaniesevaluatethequality,comprehensivenessandrobustnessoftheirmanagementsystemsundersixperformanceelements:crisismanagement;energyandgreenhousegasemissionsmanagement;tailingsmanagement;biodiversityconservationmanagement;healthandsafety;


andaboriginalrelationsandcommunityoutreach.AgapanalysisauditoftheTSMInitiativewascarriedoutin2014.Anexternalauditwascompletedinthefirstquarterof2015andasaresultofthisaudit,theKittila,GoldexandLarondeminesreceivedTSMawardsforhavingachieved"A"levelperformanceinallprotocols.

TheCompanyhasadoptedandimplementedtheWorldGoldCouncil'sConflict-FreeGoldStandard.ThisimplementationwasinitiatedonJanuary1,2013.

TheCompany'sSustainableDevelopmentPolicyisavailableontheCompany'swebsiteatwww.agnicoeagle.com. TheCanadianMalarticmine'ssustainabledevelopmentreportisavailableatitswebsite,www.canadianmalartic.com .

Employee Health and Safety

TheCompany'soverallhealthandsafetyperformance,asmeasuredbyaccidentfrequency,improvedduring2015.Acombinedlost-timeandrestrictedworkaccidentfrequencyrate(excludingtheCanadianMalarticmine)of1.23wasachieved,a17%reductionfromthe2014rateof1.48andsubstantiallybelowthetargetrateof1.50.ThisisthebestcombinedaccidentfrequencyrateeverrecordedbytheCompany.Extensivehealthandsafetytrainingwasalsoprovidedtoallemployeesduring2015.

OneofthemeasuresimplementedbytheCompanytoimprovesafetyperformanceistheworkplacesafetycardsystem.ThissystemwasimplementedacrossalloftheCompany'soperations,inCanadaandabroad,tostrengthentherisk-basedtrainingprogram.DevelopedbytheQuebecMiningAssociation(the"AMQ"),thesafetycardsystemteachesworkersandsupervisorstouserisk-basedthinkingintheirduties.Workersandtheirsupervisorsmustmeeteverydaytodiscusson-the-jobhealthandsafetymatters.ThesafetycardsystemalsoallowstheCompany'sworkersandsupervisorstodocumentdailyinspectionsandrecordobservationsonconditionsintheworkplace,aswellasthenatureofrisks,issuesandotherrelevantinformation.Inaddition,itallowssupervisorstoexchangeandanalyzeallrelevantinformationbetweenshiftsandvarioustechnicalservicestoimproveefficiencyandsafety.

In2015,theAMQacknowledgedtheCompany'sstrongperformanceintheareaofhealthandsafety,recognizing23oftheCompany'ssupervisorsfromtheLaRonde,LapaandGoldexminesforkeepingtheirworkerssafe.ThesupervisorsreceivedAMQsecuritytrophyawardsfor50,000ormorehourssupervisedwithoutalost-timeaccident.

EachoftheCompany'sminingoperationshasitsownEmergencyResponsePlanandhaspersonneltrainedtorespondtosafety,fireandenvironmentalemergencies.Eachminealsomaintainstheappropriateresponseequipment.In2014,thecorporatecrisismanagementplanwasupdatedtoalignwithindustrybestpracticesandtheTSMInitiativerequirements.Emergencyresponsesimulationswerealsoperformedatalldivisions.TheTSMInitiativealsocontainsaHealthandSafetyprotocol.Agapanalysisofcompliancewiththeprotocolwasconductedin2014andanexternalauditwaspartoftheexternalTSMInitiativeauditcarriedoutatthebeginningof2015.

TheCanadianMalarticmine'scombinedaccidentfrequencyratein2015was1.28,comparedtoanobjectiveof1.45,anddecreasedfromthe2014rateof1.52.

Community

TheCompany'sgoal,ateachofitsoperationsworldwide,istohireasmuchofitsworkforceaspossible,includingmanagementteams,directlyfromthelocalregioninwhichtheoperationislocated.In2015,theoverallcompanyaverageforlocalhiringwas80%.TheCompanybelievesthatprovidingemploymentisoneofthemostsignificantcontributionsitcanmaketothecommunitiesinwhichitoperates.

TheCompanycontinueditseffortsincommunitydevelopmentagreementsinNunavut.In2015,theMeadowbankIIBAwasrenewedandtheMeliadineIIBAwassigned.In2015,theCompanyalsocontinueditsdialoguewithFirstNationsintheAbitibiregion.ThePartnershiphasenteredintonegotiationswithFirstNationsaroundtheKirklandLakeprojectandhasalsoinitiatedadialoguewithFirstNationsintheAbitibiregion.

In2015,theCompanycontinuedtoworkcloselywithneighboringcommunitiestodevelopalternativeemploymentandbusinessopportunitiestohelpdiversifylocaleconomies.

TheCanadianMalarticminecontinueditscontributiontotheeconomicdevelopmentfund(FEMO)whichwasestablishedpriortominedevelopmenttodiversifythelocaleconomythroughouttheminelifesothatthetownofMalarticiswellequippedtofacetheeventualmineclosure.TheCanadianMalarticminehasalsoparticipatedinforumsinitiatedbythetowncouncilonthefutureofthetownofMalartic.Approximately90%ofthehiringin2015attheCanadianMalarticminewasfromthelocalarea.


Stakeholdermappingexerciseswereperformedatalldivisionstosupportthedevelopmentoflocalcommunityengagementplans.Aswell,communityliaisoncommitteeswereactivein2015.

In2015,theCompanycontinueditssupportoftheKivalliqMineTrainingSocietyandfortheuniqueupwardmobilitytrainingprogramforInuitemployeesdevelopedatMeadowbank.ThisprogramprovidestrainingandcareerpathopportunitiesforInuitwithlimitededucationandworkexperienceintheareaofheavyequipmentoperations,milloperationsandsiteservices.SkillsacquiredthroughtheprogramareeasilytransferabletoothersectorsoftheNunavuteconomy.

Fortheeighthyearinarow,thePinosAltosminewascertifiedasaSociallyResponsibleCompanybytheMexicanCentreforPhilanthropy(CentroMexicanoparalaFilantropía)andtheAllianceforSocialResponsibilityofEnterprises(AlianzaporlaResponsabilidadSocialEmpresarialenMéxico).ThiscertificationrecognizestheexcellenceofthesocialresponsibilitypracticesatthePinosAltosmine.

TheCompanycontinuestosupportanumberofcommunityhealthandeducationalinitiativesintheregionsurroundingthePinosAltosmine,includingtheestablishmentofalocalsewingcooperativeanddonatingmaterialfortheconstructionofnewclassroomsorfortherepairofexistingclassrooms.

TheCompany'sCodeofBusinessConductandEthicsPolicyisavailableontheCompany'swebsiteatwww.agnicoeagle.com .

Environmental Protection

TheCompany'sexplorationactivitiesandminingandprocessingoperationsaresubjecttothefederal,state,provincial,territorial,regionalandlocalenvironmentallawsandregulationsinthejurisdictionsinwhichtheCompany'sactivitiesandfacilitiesarelocated.Theseincluderequirementsforplanningandimplementingtheclosureandreclamationofminingpropertiesandrelatedfinancialassurance.Eachmineissubjecttoenvironmentalassessmentandpermittingprocessesduringdevelopmentand,inoperation,hasanenvironmentalmanagementsystemconsistentwithISO140001aswellasaninternalauditprogram.TheCompanyworkscloselywithregulatoryauthoritiesineachjurisdictionwhereitoperatestoensureongoingcompliance.

TheCompanyhasreportedgreenhousegasemissionsandclimatechangeriskfactorsannuallytotheCarbonDisclosureProjectsince2007.

TheMeadowbankminewasunderinvestigationin2014byEnvironmentCanadaandAboriginalAffairsandNorthernDevelopmentCanadaforaseepageeventthatoccurredin2013.EnvironmentCanadachargedtheCompanywithtwoinfractionsundertheFisheries Act .Thehearinginrelationtothesechargesisexpectedin2016.

TheCanadianMalarticminereceived25infractionsin2015,mostlyrelatedtonoise,blastingfumesandoverpressure,adecreasefromthe33infractionsreceivedin2014.Actionplanshavebeenestablishedtoimprovecompliance.

TheCompany'stotalliabilityforreclamationandclosurecostobligationsatDecember31,2015was$260millionandtheCompany'sreclamationexpensesfortheyearendedDecember31,2015were$0.6million.Formoreinformationpleaseseenote13totheAnnualFinancialStatements.

TheCompany'sEnvironmentalPolicyisavailableontheCompany'swebsiteatwww.agnicoeagle.com .


RISK FACTORS TheoperationsoftheCompanyarespeculativeduetothehigh-risknatureofitsbusiness,whichistheacquisition,financing,exploration,developmentandoperationofminingproperties.TheseriskfactorscouldmateriallyaffecttheCompany'sfinancialconditionand/orfutureoperatingresultsandcouldcauseactualeventstodiffermateriallyfromthosedescribedinforward-lookingstatementsrelatingtotheCompany.ThesearenottheonlyrisksanduncertaintiesthattheCompanyfaces.AdditionalrisksanduncertaintiesnotpresentlyknowntotheCompanyorthattheCompanycurrentlyconsidersimmaterialmayalsoimpairitsbusinessoperations.

TheCompany'sfinancialperformanceandresultsmayfluctuatewidelyduetovolatileandunpredictablecommodityprices.

TheCompany'searningsaredirectlyrelatedtocommodityprices,asrevenuesarederivedfromthesaleofgold,silver,zincandcopper.Goldprices,whichhavethegreatestimpactontheCompany'sfinancialperformance,fluctuatewidelyandareaffectedbynumerousfactors,includingcentralbankpurchasesandsales,producerhedgingandde-hedgingactivities,expectationsofinflation,investmentdemand,therelativeexchangerateoftheU.S.dollarwithothermajorcurrencies,interestrates,globalandregionaldemand,politicalandeconomicconditions,productioncostsinmajorgold-producingregions,speculativepositionstakenbyinvestorsortradersingoldandchangesinsupply,includingworldwideproductionlevels,allofwhicharebeyondtheCompany'scontrol.Theaggregateeffectofthesefactorsisimpossibletopredictwithaccuracy.Inaddition,thepriceofgoldhasonoccasionbeensubjecttoveryrapidshort-termchangesbecauseofspeculativeactivitiesorworldevents.FluctuationsingoldpricesmaymateriallyadverselyaffecttheCompany'sfinancialperformanceorresultsofoperations.IfthemarketpriceofgoldfallsbelowtheCompany'sall-insustainingcostsperounceofproductionatoneormoreofitsminesorprojectsatthattimeandremainssoforanysustainedperiod,theCompanymayexperiencelossesand/ormaycurtailorsuspendsomeorallofitsexploration,developmentandminingactivitiesatsuchminesorprojectsoratotherminesorprojects.Inaddition,suchfluctuationsmayrequirechangestothemineplans.TheCompany'scurrentmineplansandmineralreserveandmineralresourceestimatesarebasedonagoldpriceof$1,100perounce,otherthantheCanadianMalarticmine,wheremineralreservesandmineralresourcesarebasedonagoldpriceof$1,150perounce(see"OperationsandProduction–MineralReservesandMineralResources–InformationonMineralReservesandMineralResourcesoftheCompany");ifthepriceofgoldfallsbelowsuchlevels,theminesmayberendereduneconomicandproductionmaybesuspended.Inaddition,lowergoldpricesmayrequirethemineplanstobechanged,whichmayresultinreducedproduction,highercoststhananticipated,orboth,andestimatesofmineralreservesandmineralresourcesmaybereduced.Further,thepricesreceivedfromthesaleoftheCompany'sby-productmetalsproducedatitsLaRondemine(silver,zincandcopper)anditsPinosAltos,LaIndiaandCanadianMalarticmines(silver)affecttheCompany'sabilitytomeetitstargetsfortotalcashcostsperounceorall-insustainingcostsperounceofgoldproducedwhensuchmeasuresarecalculatedonaby-productbasis.Theseby-productmetalpricesfluctuatewidelyandarealsoaffectedbynumerousfactorsbeyondtheCompany'scontrol.TheCompany'spolicyandpracticeisnottosellforwarditsfuturegoldproduction;however,undertheCompany'sBoard-approvedpriceriskmanagementpolicy,theCompanymayreviewthispracticeonaprojectbyprojectbasis.See"RiskProfile–CommodityPricesandForeignCurrencies"and"RiskProfile–FinancialInstruments"intheAnnualMD&AformoredetailsontheCompany'suseofderivativeinstruments.TheCompanyoccasionallyusesderivativeinstrumentstomitigatetheeffectsoffluctuatingby-productmetalprices;however,thesemeasuresmaynotbesuccessful.

Thevolatilityofgoldpricesisillustratedinthefollowingtablewhichsetsout,fortheperiodsindicated,thehigh,lowandaverageafternoonfixingpricesforgoldontheLondonBullionMarket(the"LondonP.M.Fix").

2016

(to March 15) 2015 2014 2013 2012 2011

Highprice($perounce) 1,278 1,296 1,385 1,694 1,792 1,895

Lowprice($perounce) 1,077 1,049 1,142 1,192 1,540 1,319

Averageprice($perounce) 1,172 1,160 1,266 1,411 1,669 1,572

OnMarch15,2016,theLondonP.M.Fixwas$1,232perounceofgold.

Theassumptionsthatunderlietheestimatesoffutureoperatingresultsandthestrategiesusedtomitigatetheeffectsofrisksofmetalpricesaresetoutin"OperationsandProduction–MineralReservesandMineralResources–Information


onMineralReservesandMineralResourcesoftheCompany"inthisAIFandundertheheading"RiskProfile"intheAnnualMD&A.

Basedon2016productionestimates,theapproximatesensitivitiesoftheCompany'safter-taxincometoa10%changeincertainmetalpricesfrom2015marketaveragepricesareasfollows:

Income

per share

Gold $0.84

Silver $0.02

Zinc $0.01

Copper $0.02

SensitivitiesoftheCompany'safter-taxincometochangesinmetalpriceswillincreasewithincreasedproduction.

TheCompanyislargelydependentuponitsminingandmillingoperationsatitsMeadowbankmineinNunavutanditsLaRondemineandCanadianMalarticminesinQuebec,andanyadverseconditionaffectingthoseoperationsmayhaveamaterialadverseeffectontheCompany.

TheCompany'soperationsattheMeadowbankmineinNunavutandattheLaRondemineandCanadianMalarticminesinQuebecaccountedforapproximately23%,16%and17%,respectively,oftheCompany'sgoldproductionin2015andareexpectedtoaccountforapproximately20%,18%and18%,respectively,oftheCompany'sgoldproductionin2016.Also,in2015theMeadowbank,LaRondeandCanadianMalarticminesaccountedforapproximately22%,15%and16%,respectively,oftheCompany'soperatingmargin.AnyadverseconditionaffectingminingormillingconditionsattheseminescouldbeexpectedtohaveamaterialadverseeffectontheCompany'sfinancialperformanceandresultsofoperations(see"–IftheCompanyexperiencesminingaccidentsorotheradverseconditions,theCompany'sminingoperationsmayyieldlessgoldthanindicatedbyitsestimatedgoldproduction"below).GoldproductionattheMeadowbankmineisalsosubjecttorisksrelatingtooperatinginaremotelocation(see"–TheCompanymayexperiencedifficultiesoperatingitsMeadowbankmineanddevelopingtheMeliadineprojectasaresultoftheirremotelocation"below).

UnlesstheCompanyacquiresordevelopsothersignificantgold-producingassets,theCompanywillcontinuetobedependentonitsoperationsattheMeadowbank,LaRondeandCanadianMalarticminesforasubstantialportionofitsgoldproductionandcashflowprovidedbyoperatingactivities.TheCompany'scurrentlifeofmineplansfortheMeadowbankminecontemplatesthefinalyearofgoldproductionin2018,andtherecanbenoassurancethattheCompany'scurrentexplorationanddevelopmentprogramsatMeadowbank(includingattheAmaruqproperty)oritsotherminingprojectswillresultinanyneweconomicallyviableminingoperationsoryieldnewmineralreservestoreplaceandexpandcurrentproductionandmineralreserves.

TheCompanymayexperiencedifficultiesoperatingitsMeadowbankmineanddevelopingtheMeliadineprojectasaresultoftheirremotelocation.

TheMeadowbankmine,whichistheCompany'slargestmineintermsofproductionandoperatingmargin,islocatedintheKivalliqDistrictofNunavutinnorthernCanada,approximately70kilometresnorthofBakerLake.Inaddition,theAmaruqproperty,located50kilometresnorthwestoftheMeadowbankmine,isbeingconsideredasapossiblesatelliteoperationtotheMeadowbankmine.TheclosestmajorcitytotheMeadowbankmineisWinnipeg,Manitoba,approximately1,500kilometrestothesouth.TheCompanybuilta110-kilometreall-weatherroadfromBakerLake,whichprovidessummershippingaccessviaHudsonBaytotheMeadowbankmineandtheCompanyplanstobuildanall-weatherroadbetweenMeadowbankandtheAmaruqproperty.However,theCompany'soperationsareconstrainedbytheremotenessofthemine,particularlyastheportofBakerLakeisonlyaccessibleapproximatelytenweeksperyear.MostofthematerialsthattheCompanyrequiresfortheoperationoftheMeadowbankminemustbetransportedthroughtheportofBakerLakeduringthisshippingseason,whichmaybefurthertruncatedduetoweatherconditions.IftheCompanyisunabletoacquireandtransportnecessarysuppliesduringthistime,itmayresultinaslowdownorstoppageofoperationsattheMeadowbankmine.Furthermore,ifmajorequipmentfails,itemsnecessarytoreplaceorrepairsuchequipmentmayhavetobeshippedthroughBakerLakeduringthiswindow.Failuretohaveavailablethenecessary


materialsrequiredforoperationsortorepairorreplacemalfunctioningequipmentattheMeadowbankmine(includingattheAmaruqproperty)mayrequiretheslowdownorstoppageofoperations.Forexample,aMarch2011fireatthekitchenfacilitiesoftheMeadowbankminerequiredoperationstobereducedatthemine,whichresultedingoldproductionattheminebeingbelowexpectedlevelsin2011.

TheCompany'sMeliadineproject,290kilometressoutheastoftheMeadowbankmine,isalsolocatedintheKivalliqDistrictofNunavut,approximately25kilometresnorthwestofthehamletofRankinInletonthewestcoastofHudsonBay.MostofthematerialsthattheCompanyrequirestooperatetheadvancedexplorationprogram,andmayrequireifitdeterminestobuildamineinthefuture,mustbetransportedthroughtheportofRankinInletduringitsapproximately14-weekshippingseason.IftheCompanycannotidentifyandprocuresuitableequipmentandmaterialswithinatimeframethatpermitstransportingthemtotheprojectwithinthisshippingseason,itcouldresultindelaysand/orcostincreasesintheexplorationprogramand,iftheCompanydeterminestobuildamine,anyconstructionordevelopmentontheproperty.

TheremotenessoftheMeadowbankmine,theAmaruqpropertyandMeliadineprojectalsonecessitatestheuseoffly-in/fly-outcampsfortheaccommodationofsiteemployeesandcontractors,whichmayhaveanimpactontheCompany'sabilitytoattractandretainqualifiedmining,explorationandconstructionpersonnel.IftheCompanyisunabletoattractandretainsufficientpersonnelorcontractorsonatimelybasis,theCompany'soperationsattheMeadowbankmine(includingattheAmaruqproperty)andfuturedevelopmentplansattheMeliadineprojectmaybeadverselyaffected.

IftheCompanyexperiencesminingaccidentsorotheradverseconditions,theCompany'sminingoperationsmayyieldlessgoldthanindicatedbyitsestimatedgoldproduction.

TheCompany'sgoldproductionmayfallbelowestimatedlevelsasaresultofminingaccidentssuchascave-ins,rockfalls,rockbursts,pitwallfailures,firesorfloodingorasaresultofotheroperationalproblemssuchasafailureofaproductionhoist,autoclave,filterpressorsemi-autogenousgrindingmill.Inaddition,productionmaybereducedif,duringthecourseofminingorprocessing,unfavourableweatherconditions,groundconditions,highgeomechanicalstressareasorseismicactivityareencountered,oregradesarelowerthanexpected,thephysicalormetallurgicalcharacteristicsoftheorearelessamenablethanexpectedtominingortreatment,dilutionincreases,electricalpowerisinterruptedorheapleachprocessingresultsincontainmentdischarge.WhiletheCompanyhasmetorexceededproductionforecastssince2012,itfailedtodosoinfiveoftheprevioustenyearsprimarilydueto:increasedstresslevelsinasillpillarrequiringthetemporaryclosureofproductionsublevelsin2005atLaRonde;delaysinthecommissioningoftheGoldexproductionhoistandtheKittilaautoclavein2008;andautoclaveissuesatKittila,filteringissuesatPinosAltosanddilutionissuesatLapain2009.In2010,goldproductionwasbelowtheinitialanticipatedrangeprimarilyasaresultoflowerthroughputattheMeadowbankminemillduetoabottleneckinthecrushingcircuitandcontinuedautoclaveissuesattheKittilamineinthefirsthalfoftheyear.In2011,goldproductionwasbelowtheinitialanticipatedrangeprimarilyasaresultofsuspensionofminingoperationsattheGoldexmineduetogeotechnicalconcernswiththerockabovethemininghorizon,afireintheMeadowbankminekitchencomplexthatnegativelyimpactedproduction,andlowerthanexpectedgradesattheMeadowbankandLaRondemines.In2012,goldproductionwasnegativelyaffectedbythetemporarysuspensionofheapleachoperationsattheCrestonMascotadepositatPinosAltosasaresultofissueswiththephaseoneleachpadliner.In2013,goldproductionwasnegativelyaffectedbyanextendedmaintenanceshutdownatKittiladuringthesecondquarter,duringwhichthemineonlyoperatedfor14days,anda16-dayunplannedshutdownrelatedtotheLaRondehoistdrive.In2014,goldproductionwasnegativelyaffectedbytendaysofdowntimeresultingfromaproductionhoistdrivefailureatLaRonde.In2015,goldproductionwasnegativelyaffectedbylowerthanexpectedgradesatKittilaandadecisionduringtheyeartoextendtheVaultpitatMeadowbankresultinginlowerthanexpected2015production.Occurrencesofthisnatureandotheraccidents,adverseconditionsoroperationalproblemsinfutureyearsmayresultintheCompany'sfailuretoachievecurrentorfutureproductionestimates.

TheCompany'stotalcashcostsperounceandall-insustainingcostsperounceofgoldproductiondepend,inpart,onexternalfactorsthataresubjecttofluctuationand,ifsuchcostsincrease,someoralloftheCompany'sactivitiesmaybecomeunprofitable.

TheCompany'stotalcashcostsperounceandall-insustainingcostsperounceofgoldaredependentonanumberoffactors,includingtheexchangeratebetweentheU.S.dollarandtheCanadiandollar,EuroandMexicanpeso,smeltingandrefiningcharges,productionroyalties,thepriceofgoldandby-productmetals(whencalculatedonaby-productbasis)andthecostofinputsusedinminingoperations.AttheLaRondemine,theCompany'stotalcashcostsperounceandall-insustainingcostsperounceofproduction(whencalculatedonaby-productbasis)areaffectedbythepricesand


productionlevelsofby-productzinc,silverandcopper,therevenuefromwhichisoffsetagainstthecostofgoldproduction.AttheCanadianMalarticmine,theCompany'stotalcashcostsperounceandall-insustainingcostsperounceofproduction(whencalculatedonaby-productbasis)areaffectedbythepricesandproductionlevelsofby-productsilver,therevenuefromwhichisoffsetagainstthecostofgoldproduction.Totalcashcostsperounceandall-insustainingcostsperouncefromtheCompany'soperationsatthePinosAltosandLaIndiaminesareaffectedbytheexchangeratebetweentheU.S.dollarandtheMexicanpesoandthepriceand(whencalculatedonaby-productbasis)productionlevelofby-productsilver,therevenuefromwhichisoffsetagainstthecostofgoldproduction.Totalcashcostsperounceandall-insustainingcostsperouncefromtheCompany'soperationsatitsminesinCanadaandtheKittilamineinFinlandareaffectedbychangesintheexchangeratesbetweentheU.S.dollarandtheCanadiandollarandtheEuro,respectively.Totalcashcostsperounceandall-insustainingcostsperounceatalloftheCompany'sminesarealsoaffectedbythecostsofinputsusedinminingoperations,includinglabour(includingcontractors),steel,chemicalreagentsandenergy.AllofthesefactorsarebeyondtheCompany'scontrol.IftheCompany'stotalcashcostsperounceorall-insustainingcostsperounceofgoldriseabovethemarketpriceofgoldandremainsoforanysustainedperiod,theCompanymayexperiencelossesandmaycurtailorsuspendsomeorallofitsexploration,developmentand/orminingactivities.

Totalcashcostsperounceandall-insustainingcostsperouncearenotrecognizedmeasuresunderUSGAAPorIFRS,andthisdatamaynotbecomparabletodatapresentedbyothergoldproducers.SeetheAnnualMD&Aforreconciliationoftotalcashcostsperounceandall-insustainingcostsperounceandminesitecostspertonnetotheirclosestIFRSmeasureand"IntroductoryNotes–NotetoInvestorsConcerningCertainMeasuresofPerformance"inthisAIFforadiscussionofnon-GAAPmeasures.

TheCompany'smineconstructionprojectsandexpansionprojectsaresubjecttorisksassociatedwithminedevelopment,whichmayresultindelaysintheoptimizationofminingoperations,delaysinexistingoperationsandunanticipatedcosts.

TheCompany'sproductionforecastsarebasedonfullproductionbeingachievedatallofitsmines,andtheCompany'sabilitytoachieveandmaintainfullproductionratesattheseminesissubjecttoanumberofrisksanduncertainties.Productionfromtheseminesin2016maybelowerthananticipatediftheanticipatedfullproductionratecannotbeachieved.

TheLaRondemineextension,whichcommencedoperationinlate2011,isoneofthedeepestoperationsintheWesternHemispherewithacurrentlyexpectedmaximumdepthof3,110metresbelowthesurfaceand,in2016,89%oftheLaRondemine'sproductionisanticipatedtobefromtheLaRondemineextension.TheLaRondemineextensionhasnotyetbeguntooperateatexpectedsteady-statelevels.TheCompany'soperationsattheLaRondemineextensionrelyoninfrastructureinstalledinconnectionwiththeextensionforhaulingoreandmaterialstothesurface,includingawinze(orinternalshaft)andaseriesoframpslinkingminingdepositstothePennaShaftthatserviceshistoricoperationsattheLaRondemine.ThedepthoftheoperationsposessignificantchallengestotheCompany,suchasgeomechanicalandseismicrisksandventilationandairconditioningrequirements,whichmayresultindifficultiesanddelaysinachievinggoldproductionobjectives.OperationsatthelowerleveloftheLaRondeminearesubjecttohighlevelsofgeomechanicalstressandtherearefewresourcesavailabletoassisttheCompanyinmodellingthegeomechanicalconditionsatthesedepths,whichmayresultintheCompanynotbeingabletoextracttheoreattheselevelsascurrentlycontemplated.In2012,challengesassociatedwithexcessheatandcongestionatthelowerpartsoftheminedelayedtherampupofproductionandin2013,throughputattheLaRondeminewasreducedasaresultof16daysofunplannedshutdowntothehoistdrive.In2014,tendaysofdowntimeresultingfromaproductionhoistdrivefailureresultedinannualproductionatLaRondebeingapproximately10,000ouncesbelowtheCompany`sexpectations.

ThefurtherdevelopmentoftheKittilaandPinosAltosmines,aswellasthedevelopmentofthenewminingzonesattheGoldexmine,requirestheconstructionandoperationofnewundergroundmininginfrastructureand,atKittila,millingoperationswererequiredtobeexpanded.Theconstructionandoperationofundergroundminingfacilitiesandtheexpansionofmillingfacilitiesaresubjecttoanumberofrisks,includingunforeseengeologicalformations,implementationofnewminingormillingprocesses,delaysinobtainingrequiredconstruction,environmentaloroperatingpermitsandengineeringandmineormilldesignadjustments.

Mineralreserveandmineralresourceestimatesareonlyestimatesandsuchestimatesmaynotaccuratelyreflectfuturemineralrecovery.

ThefiguresformineralreservesandmineralresourcespublishedbytheCompanyareestimatesandnoassurancecanbegiventhattheanticipatedtonnagesandgradeswillbeachievedorthattheindicatedlevelofrecoveryofgoldwillbe


realized.MineralreserveandmineralresourceestimatesarebasedongoldrecoveriesinsmallscalelaboratorytestsandmaynotbeindicativeofthemineralizationintheentireorebodyandtheCompanymaynotbeabletoachievesimilarresultsinlargerscaletestsunderon-siteconditionsorduringproduction.TheoregradeactuallyrecoveredbytheCompanymaydifferfromtheestimatedgradesofthemineralreservesandmineralresources.Theestimatesofmineralreservesandmineralresourceshavebeendeterminedbasedonassumedmetalprices,foreignexchangeratesandoperatingcosts.Forexample,theCompanyhasestimatedprovenandprobablemineralreservesbasedon,amongotherthings,a$1,100perouncegoldprice($1,150forCanadianMalartic).Theyearlyaveragegoldpricehasbeenabove$1,100perouncesince2010;however,priortothattime,yearlyaveragegoldpriceswerebelow$1,100perounce.Prolongeddeclinesinthemarketpriceofgold(orapplicableby-productmetalprices)mayrendermineralreservescontainingrelativelylowergradesofmineralizationuneconomicaltorecoverandcouldmateriallyreducetheCompany'smineralreserves.Shouldsuchreductionsoccur,theCompanymayberequiredtotakeamaterialwrite-downofitsinvestmentinminingproperties,reducethecarryingvalueofoneormoreofitsassetsordelayordiscontinueproductionorthedevelopmentofnewprojects,resultinginincreasednetlossesandreducedcashflow.TheCompanyusedanassumed$1,250long-termgoldpricetotestforimpairmentofitsminesandconcludednoimpairmentsexistedasatDecember31,2015.Marketpricefluctuationsofgold(orapplicableby-productmetalprices),aswellasincreasedproductioncostsorreducedrecoveryrates,mayrendermineralreservescontainingrelativelylowergradesofmineralizationuneconomicaltorecoverandmayultimatelyresultinarestatementofmineralresources.Short-termfactorsrelatingtothemineralreserve,suchastheneedfororderlydevelopmentoforebodiesortheprocessingofnewordifferentgrades,mayimpairtheprofitabilityofamineinanyparticularaccountingperiod.

Mineralresourceestimatesforpropertiesthathavenotcommencedproductionoratdepositsthathavenotyetbeenexploitedarebased,inmostinstances,onverylimitedandwidelyspaceddrillholeinformation,whichisnotnecessarilyindicativeofconditionsbetweenandaroundthedrillholes.Accordingly,suchmineralresourceestimatesmayrequirerevisionasmoredrillinginformationbecomesavailableorasproductionexperienceisgained.

TheCompanymayexperienceproblemsinexecutingacquisitionsormanagingandintegratinganycompletedacquisitionswithitsexistingoperations.

TheCompanyregularlyevaluatesopportunitiestoacquiresecuritiesorassetsofotherminingbusinesses.Suchacquisitionsmaybesignificantinsize,maychangethescaleoftheCompany'sbusinessandmayexposetheCompanytonewgeographic,political,operating,financialorgeologicalrisks.TheCompany'ssuccessinitsacquisitionactivitiesdependsonitsabilitytoidentifysuitableacquisitioncandidates,acquirethemonacceptabletermsandintegratetheiroperationssuccessfullywiththoseoftheCompany.Anyacquisitionwouldbeaccompaniedbyrisks,suchas:duediligencefailures;thedifficultyofassimilatingtheoperationsandpersonnelofanyacquiredbusinesses;thepotentialdisruptionoftheCompany'songoingbusiness;theinabilityofmanagementtomaximizethefinancialandstrategicpositionoftheCompanythroughthesuccessfulintegrationofacquiredassetsandbusinesses;themaintenanceofuniformstandards,controls,proceduresandpolicies;theimpairmentofrelationshipswithemployees,customers,suppliersandcontractorsasaresultofanyintegrationofnewmanagementpersonnel;andthepotentialunknownliabilities(includingpotentialenvironmentalliabilitiesoranypriorbriberyorcorruptionactivities)associatedwithacquiredassetsandbusinesses.Inaddition,theCompanymayneedadditionalcapitaltofinanceanacquisition.PotentialacquisitiontargetsmayoperateinjurisdictionsinwhichtheCompanydoesnotoperateandthatmayhaveadifferentriskprofilethanthejurisdictionsinwhichtheCompanycurrentlyoperates(see"–TheCompanymayexperienceoperationaldifficultiesatitsforeignoperations").DebtfinancingrelatedtoanyacquisitionmayexposetheCompanytotherisksrelatedtoincreasedleverage,whileequityfinancingmaycauseexistingshareholderstosufferdilution.TheCompanyispermittedunderthetermsofitsunsecuredrevolvingbankcreditfacilityanditsguaranteedseniorunsecurednotesreferredtounder"MaterialContracts"belowtoincuradditionalunsecuredindebtedness,providedthatitmaintainscertainfinancialratiosandmeetsfinancialconditioncovenantsand,inthecaseofthebankcreditfacility,thatnoeventofdefaultunderthebankcreditfacilityhasoccurredandiscontinuing,orwouldoccurasaresultoftheincurrenceorassumptionofsuchindebtedness.TherecanbenoassurancethattheCompanywouldbesuccessfulinovercomingtheseoranyotherproblemsencounteredinconnectionwithsuchacquisitions.

TheCompanymayexperienceoperationaldifficultiesatitsforeignoperations.

TheCompany'soperationsincludeamineinFinlandandtwominesinnorthernMexico.Collectively,theseminesaccountedforapproximately32%oftheCompany'sgoldproductionin2015andareexpectedtoaccountforapproximately34%oftheCompany'sgoldproductionin2016.Theseoperationsaresubjecttovariouslevelsofpolitical,economicandotherrisksanduncertaintiesthataredifferentfromthoseencounteredattheCompany'sCanadianproperties.Theserisksanduncertaintiesvaryfromcountrytocountryandmayinclude:extremefluctuationsincurrency


exchangerates;highratesofinflation;labourunrest;risksofwarorcivilunrest;expropriationandnationalization;renegotiationornullificationofexistingconcessions,licences,permitsandcontracts;illegalmining;corruption;restrictionsonforeignexchangeandrepatriation;hostagetaking;changingpoliticalconditions;andcurrencycontrols.Inaddition,theCompanymustcomplywithmultipleandpotentiallyconflictingregulationsinCanada,theUnitedStates,FinlandandMexico,includingexportrequirements,taxes,tariffs,importdutiesandothertradebarriers,aswellashealth,safetyandenvironmentalrequirements.

Changes,ifany,inminingorinvestmentpoliciesorshiftsinpoliticalattitudeinFinlandorMexicomayadverselyaffecttheCompany'soperationsorprofitability.Operationsmaybeaffectedinvaryingdegreesbygovernmentregulationswithrespecttomattersincludingrestrictionsonproduction,pricecontrols,exportcontrols,currencycontrolsorrestrictions,currencyremittance,incomeandothertaxes,expropriationofproperty,foreigninvestment,maintenanceofclaims,environmentallegislation,landuse,landclaimsoflocalpeople,wateruseandminesafety.Failuretocomplystrictlywithapplicablelaws,regulationsandlocalpracticesrelatingtomineralrightsapplicationsandtenurecouldresultinloss,reductionorexpropriationofentitlementsortheimpositionofadditionallocalorforeignpartiesasjointventurepartnerswithcarriedorotherinterests.

Inaddition,FinlandandMexicohavesignificantlydifferentlawsandregulationsthanCanadaandthereareculturalandlanguagedifferencesbetweenthesecountriesandCanada.Also,theCompanyfaceschallengesinherentinefficientlymanagingemployeesoverlargegeographicaldistances,includingthechallengesofstaffingandmanagingoperationsinseveralinternationallocationsandimplementingappropriatesystems,policies,benefitsandcomplianceprograms.Thesechallengesmaydivertmanagement'sattentiontothedetrimentoftheCompany'sotheroperations.TherecanbenoassurancethatdifficultiesassociatedwiththeCompany'sforeignoperationscanbesuccessfullymanaged.

Inthefuture,theCompanymaychoosetooperateinforeignjurisdictionsotherthanFinlandandMexico.Forexample,theCompanycurrentlyhasexplorationpropertiesineachoftheUnitedStatesandSweden,aswellasstrategicinvestmentsincompaniesholdingpropertiesinBrazilandPanama.Suchoperationswouldinherentlybesubjecttovariouslevelsofpolitical,economicandotherrisksanduncertaintiesthataredifferentfromthoseencounteredattheCompany'sCanadian,FinnishandMexicanproperties.

TheCompanyissubjecttotherisksnormallyassociatedwiththeconductofjointoperations.

TheCompanyholdsanindirect50%interestintheCanadianMalarticminethroughthePartnership,withtheremaininginterestinthispropertybeingheldindirectlybyYamana.TheCompany'sinterestintheCanadianMalarticmineissubjecttotherisksnormallyassociatedwiththeconductofpartnershipsandotherjointoperations.TheexistenceoroccurrenceofoneormoreofthefollowingcircumstancesandeventscouldhaveamaterialadverseeffectonCompany'sprofitabilityortheviabilityofitsinterestsheldthroughjointoperations,whichcouldhaveamaterialadverseeffectontheCompany'sfinancialperformanceandresultsofoperations:(i)lackofcontroloverthejointoperationsanddisagreementwithpartnersonhowtoexplore,developoroperateminesefficiently;(ii)inabilitytoexertinfluenceovercertainstrategicdecisionsmadeinrespectofjointlyheldproperties;(iii)inabilityofpartnerstomeettheirobligationstothejointoperationorthirdparties;(iv)litigationbetweenjointventurepartnersregardingjointoperationmatters;and(v)liabilitythatmightaccruetopartnersasaresultofthefailureofthejointventureorgeneralpartnershiptosatisfytheirobligations.TheCompanymayenterintoadditionaljointventuresorpartnershipsinthefuture.In2015,theCompanyenteredintoajointventurewithOrexMineralsInc.withrespecttotheBarseleprojectinSweden.

TotheextentthattheCompanyisnottheoperatorofitsjointventureproperties,theCompanywillbedependentontheoperatorsforthetimingofactivitiesrelatedtothesepropertiesandtheCompanywillbelargelyunabletodirectorcontroltheactivitiesoftheoperators.TheCompanyalsowillbesubjecttothedecisionsmadebytheoperatorsregardingactivitiesattheproperties,andwillhavetorelyontheoperatorsforaccurateinformationabouttheproperties.AlthoughtheCompanyexpectsthattheoperatorsofthepropertiesinwhichitownsajointventureinterestwilloperatethesepropertiesinaccordancewithindustrystandardsandinaccordancewithanyapplicableoperatingagreements,therecanbenoassurancethatalldecisionsoftheoperatorswillachievetheexpectedgoals.

FluctuationsinforeigncurrencyexchangeratesinrelationtotheU.S.dollarmayadverselyaffecttheCompany'sresultsofoperations.

TheCompany'soperatingresultsandcashflowaresignificantlyaffectedbychangesintheU.S.dollar/Canadiandollarexchangerate.AlloftheCompany'srevenuesareearnedinU.S.dollarsbutthemajorityofitsoperatingcostsattheLaRonde,Lapa,Goldex,CanadianMalarticandMeadowbankmines,aswellastheMeliadineproject,areincurredinCanadiandollars.TheU.S.dollar/Canadiandollarexchangeratehasfluctuatedsignificantlyoverthelastseveralyears.


FromJanuary1,2011toJanuary1,2016,theNoonBuyingRatefluctuatedfromahighofC$1.0583per$1.00toalowofC$0.7148per$1.00.HistoricalfluctuationsintheU.S.dollar/Canadiandollarexchangeratearenotnecessarilyindicativeoffutureexchangeratefluctuations.BasedontheCompany'santicipated2016after-taxoperatingresults,a10%changeintheU.S.dollar/Canadiandollarexchangeratefromthe2015marketaverageexchangeratewouldaffectnetincomebyapproximately$0.26pershare.Toattempttomitigateitsforeignexchangeriskandminimizetheimpactofexchangeratemovementsonoperatingresultsandcashflow,theCompanyhasperiodicallyusedforeigncurrencyoptionsandforwardforeignexchangecontractstopurchaseCanadiandollars;however,therecanbenoassurancethatthesestrategieswillbeeffective.See"RiskProfile–CommodityPricesandForeignCurrencies"intheAnnualMD&Aforadescriptionoftheassumptionsunderlyingthesensitivitycalculations.Inaddition,themajorityoftheCompany'soperatingcostsattheKittilamineareincurredinEurosandasignificantportionofoperatingcostsatthePinosAltosandLaIndiaminesareincurredinMexicanpesos.EachofthesecurrencieshasalsofluctuatedsignificantlyagainsttheU.S.dollaroverthepastseveralyears.TherecanbenoassurancethattheCompany'sforeignexchangederivativesstrategieswillbesuccessfulorthatforeignexchangefluctuationswillnotmateriallyadverselyaffecttheCompany'sfinancialperformanceandresultsofoperations.

TheCompanyestimatestherecoverableamountoflong-livedassetsandgoodwillusingassumptionsandifthecarryingvalueofanassetorgoodwillisthendeterminedtobegreaterthanitsactualrecoverableamount,animpairmentisrecognizedreducingtheCompany'searnings.

TheCompanyconductsannualimpairmentassessmentsofgoodwillandattheendofeachreportingperiodtheCompanyassesseswhetherthereisanyindicationthatlong-livedassets(suchasminingpropertiesandplantandequipment)maybeimpaired.Ifanindicatorofimpairmentexists,therecoverableamountoftheassetiscalculatedinordertodetermineifanyimpairmentlossisrequired.Testingforimpairmentinvolvesacomparisonoftherecoverableamountofthecashgeneratingunittoitscarryingvalue.Animpairmentchargeisrecognizedforanyexcessofthecarryingamountoftheassetgrouporreportingunitoveritsrecoverableamount.AsatDecember31,2015,theCompanytestedforimpairmentofitsminesandprojectsandconcludednoimpairmentsexisted.

Theassessmentforimpairmentissubjectiveandrequiresmanagementtomakeestimatesandassumptionsforanumberoffactorsincludingestimatesofproductionlevels,mineralresourcesandmineralreserves,operatingcostsandcapitalexpendituresreflectedintheCompany'slife-of-mineplans,aswellaseconomicfactorsbeyondmanagement'scontrol,suchasgoldprices,discountratesandobservablenetassetvaluemultiples.Shouldmanagement'sestimatesandassumptionsregardingthesefactorsbeincorrect,theCompanymayberequiredtorealizeimpairmentcharges,whichwillreducetheCompany'searnings.Thetimingandamountofsuchimpairmentchargesisdifficulttopredict.

TheCompany'stransitiontoreportingitsfinancialresultsunderIFRSmayalsohaveaneffectonthefrequencyandamountofimpairmentcharges.UnderUSGAAP,atwo-stepapproachisusedforlong-livedassetimpairmenttestingwherebylong-livedassetsarefirsttestedforrecoverabilitybasedontheirexpectedundiscountedcashflows.Ifalong-livedasset'sexpectedundiscountedcashflowexceedstherecordedcarryingamount,noimpairmentchargeisrequired.Iftheexpectedundiscountedcashflowislowerthantherecordedcarryingamount,thelong-livedassetsarewrittendowntotheirestimatedfairvalue.IFRSprescribesaone-stepapproachforassetimpairmenttestingandmeasurementwherebyanasset'srecoverableamountiscompareddirectlyagainstitsrecordedcarryingamount.UnderIFRS,anasset'srecoverableamountisdeterminedasthehigheroftheestimatedfairvaluelesscoststosellorvalueinuse(whichismeasuredusingdiscountedcashflows).Ifanasset'srecoverableamountislessthantherecordedcarryingamount,animpairmentchargeisrequired.ThedifferenceintheapproachtoassetimpairmenttestingandmeasurementmayresultinmorefrequentimpairmentchargesunderIFRS,whereassetcarryingvaluespreviouslysupportedunderUSGAAPonanundiscountedcashflowbasiscannotbesupportedonadiscountedcashflowbasis.

IftheCompanyfailstocomplywithrestrictivecovenantsinitsdebtinstruments,theCompany'sabilitytoborrowunderitsunsecuredrevolvingbankcreditfacilitycouldbelimitedandtheCompanymaythendefaultunderotherdebtagreements,whichcouldharmtheCompany'sbusiness.

TheCompany'sunsecuredrevolvingbankcreditfacilitylimits,amongotherthings,theCompany'sabilitytopermitthecreationofcertainliens,makeinvestmentsotherthaninvestmentsinbusinessesrelatedtominingorabusinessancillaryorcomplementarytomining,disposeoftheCompany'smaterialassetsor,incertaincircumstances,paydividends.Inaddition,theCompany'sguaranteedseniorunsecurednoteslimit,amongotherthings,theCompany'sabilitytopermitthecreationofcertainliens,carryonbusinessunrelatedtominingordisposeoftheCompany'smaterialassets.ThebankcreditfacilityandtheguaranteedseniorunsecurednotesalsorequiretheCompanytomaintainspecifiedfinancialratiosandmeetfinancialconditioncovenants.EventsbeyondtheCompany'scontrol,includingchangesingeneraleconomic


andbusinessconditions,mayaffecttheCompany'sabilitytosatisfythesecovenants,whichcouldresultinadefaultunderthebankcreditfacilityortheguaranteedseniorunsecurednotesand,byextension,theBNSLetterofCreditFacility(asdefinedbelow).AtMarch15,2016,therewasapproximately$266milliondrawnunderthebankcreditfacility(includingoutstandinglettersofcredit),approximatelyC$239milliondrawnundertheBNSLetterofCreditFacilityandapproximatelyC$97milliondrawnundertheTDLetterofCreditFacility(asdefinedbelow).Ifaneventofdefaultundertheunsecuredrevolvingbankcreditfacilityortheguaranteedseniorunsecurednotesoccurs,theCompanywouldbeunabletodrawdownfurtheronthebankcreditfacilityandthelenderscouldelecttodeclareallprincipalamountsoutstandingthereunderatsuchtime,togetherwithaccruedinterest,tobeimmediatelydueanditcouldcauseaneventofdefaultundertheCompany'sguaranteedseniorunsecurednotesandtheBNSLetterofCreditFacility.Aneventofdefaultundertheunsecuredrevolvingbankcreditfacility,theguaranteedseniorunsecurednotesortheuncommittedletterofcreditfacilitiesmayalsogiverisetoaneventofdefaultunderotherexistingandfuturedebtagreementsand,insuchevent,theCompanymaynothavesufficientfundstorepayamountsowingundersuchagreements.

Theexplorationofmineralpropertiesishighlyspeculative,involvessubstantialexpendituresandisfrequentlyunsuccessful.

TheCompany'sprofitabilityissignificantlyaffectedbythecostsandresultsofitsexplorationanddevelopmentprograms.Asmineshavelimitedlivesbasedonprovenandprobablemineralreserves,theCompanyactivelyseekstoreplaceandexpanditsmineralreserves,primarilythroughexplorationanddevelopmentaswellasthroughstrategicacquisitions.Explorationformineralsishighlyspeculativeinnature,involvesmanyrisksandisfrequentlyunsuccessful.Amongthemanyuncertaintiesinherentinanygoldexplorationanddevelopmentprogramarethelocationofeconomicorebodies,thedevelopmentofappropriatemetallurgicalprocesses,thereceiptofnecessarygovernmentalpermits,theacceptanceorsupportoflocalstakeholdersandtheconstructionofminingandprocessingfacilities.Substantialexpendituresarerequiredtopursuesuchexplorationanddevelopmentactivities.Assumingdiscoveryofaneconomicorebody,dependingonthetypeofminingoperationinvolved,severalyearsmayelapsefromtheinitialphasesofdrillinguntilcommercialoperationsarecommencedandduringsuchtimetheeconomicfeasibilityofproductionmaychange.Accordingly,therecanbenoassurancethattheCompany'scurrentorfutureexplorationanddevelopmentprogramswillresultinanyneweconomicallyviableminingoperationsoryieldnewmineralreservestoreplaceandexpandcurrentmineralreserves.

Theminingindustryishighlycompetitive,andtheCompanymaynotbesuccessfulincompetingfornewminingproperties.

Thereisalimitedsupplyofdesirablemineralpropertiesavailableforclaimstaking,leasing,explorationoracquisitionintheareaswheretheCompanycontemplatesconductingactivities.Manycompaniesandindividualsareengagedintheminingbusiness,includinglarge,establishedminingcompanieswithsubstantialcapabilitiesandlongearningsrecords.TheCompanymaybeatacompetitivedisadvantageinacquiringminingproperties,asitmustcompetewiththesecompaniesandindividuals,someofwhichhavegreaterfinancialresourcesandlargertechnicalstaffthantheCompany.Accordingly,therecanbenoassurancethattheCompanywillbeabletocompetesuccessfullyfornewminingproperties.

ThesuccessoftheCompanyisdependentongoodrelationswithitsemployeesandonitsabilitytoattractandretainemployeesandkeypersonnel.

ProductionattheCompany'sminesandmineprojectsisdependentontheeffortsoftheCompany'semployeesandcontractors.TheCompanycompeteswithminingandothercompaniesonaglobalbasistoattractandretainemployeesatalllevelswithappropriatetechnicalskillsandoperatingexperiencenecessarytooperateitsmines.RelationshipsbetweentheCompanyanditsemployeesmaybeaffectedbychangesintheschemeoflabourrelationsthatmaybeintroducedbyrelevantgovernmentauthoritiesinthejurisdictionsthattheCompanyoperates.ChangesinapplicablelegislationorintherelationshipbetweentheCompanyanditsemployeesorcontractorsmayhaveamaterialadverseeffectontheCompany'sbusiness,resultsofoperationsandfinancialcondition.

TheCompanyisalsodependentonanumberofkeymanagementpersonnel.ThelossoftheservicesofoneormoreofsuchkeymanagementpersonnelcouldhaveamaterialadverseeffectontheCompany.TheCompany'sabilitytomanageitsoperating,development,explorationandfinancingactivitieswilldependinlargepartontheeffortsoftheseindividuals.

TheCompanyfacessignificantcompetitiontoattractandretainqualifiedpersonnelandtherecanbenoassurancethattheCompanywillbeabletoattractandretainsuchpersonnel.


TheCompanymayhavedifficultyfinancingitsadditionalcapitalrequirementsforitsplannedmineconstruction,explorationanddevelopment.

Thecapitalrequiredforoperations(includingpotentialexpansions)andthedevelopmentoftheMeliadineprojectandtheexplorationanddevelopmentoftheCompany'sproperties,includingcontinuingexplorationanddevelopmentprojectsinQuebec,Nunavut,Finland,Sweden,MexicoandNevada,willrequiresubstantialexpenditures.TheCompanyexpectsthatcapitalexpenditureswillbeapproximately$491millionin2016.AsatMarch15,2016,theCompanyhadapproximately$934millionavailabletobedrawndownunderitsbankcreditfacility.BasedoncurrentfundingavailabletotheCompanyandexpectedcashfromoperations,theCompanybelievesithassufficientfundsavailabletofunditsprojected2016capitalexpendituresforallofitscurrentproperties.However,ifcashfromoperationsislowerthanexpectedorcapitalcostsattheCompany'sminesorprojectsexceedcurrentestimates,iftheCompanyincursmajorunanticipatedexpensesrelatedtoexploration,developmentormaintenanceofitsproperties,orforotherpurposesorifadvancesfromthebankcreditfacilityareunavailable,theCompanymayberequiredtoseekadditionalfinancingtomaintainitscapitalexpendituresatplannedlevels.Inaddition,theCompanywillhaveadditionalcapitalrequirementstotheextentthatitdecidestoexpanditspresentoperationsandexplorationactivities,constructadditionalminingandprocessingoperationsatanyofitspropertiesortakeadvantageofopportunitiesforacquisitions,jointventuresorotherbusinessopportunitiesthatmayarise.Additionalfinancingmaynotbeavailablewhenneededor,ifavailable,thetermsofsuchfinancingmaynotbefavourabletotheCompanyand,ifraisedbyofferingequitysecurities,orsecuritiesconvertibleintoequitysecurities,anyadditionalfinancingmayinvolvesubstantialdilutiontoexistingshareholders.FailuretoobtainanyfinancingnecessaryfortheCompany'scapitalexpenditureplansmayresultinadelayorindefinitepostponementofexploration,developmentorproductiononanyoralloftheCompany'sproperties,whichmayhaveamaterialadverseeffectontheCompany'sbusiness,financialconditionandresultsofoperations.

ThecontinuingweaknessintheglobalcreditandcapitalmarketscouldhaveamaterialadverseeffectontheCompany'sliquidityandcapitalresources.

Since2008,thecreditandcapitalmarketshaveexperiencedweaknessandvolatility.Thesecreditandcapitalmarketsconditionscontinuetohaveanegativeimpactontheavailabilityandtermsofcreditandcapital.Ifuncertaintiesinthesemarketscontinue,orthesemarketsdeterioratefurther,itcouldhaveamaterialadverseeffectontheCompany'sliquidity,abilitytoraisecapitalandcostsofcapital.IftheCompanyexperiencesdifficultyaccessingthecreditand/orcapitalmarkets,theCompanymayseekalternativefinancingoptions,including,butnotlimitedto,streamingtransactions,royaltytransactionsorthesaleofnon-coreassets.FailuretoraisecapitalwhenneededoronreasonabletermsmayhaveamaterialadverseeffectontheCompany'sbusiness,financialconditionandresultsofoperations.

TheCompany'spropertiesandminingoperationsmaybesubjecttorightsorclaimsofindigenousgroupsandtheassertionofsuchrightsorclaimsmayimpacttheCompany'sabilitytodeveloporoperateitsminingproperties.

TheCompanyoperatesin,andinthefuturemayoperateinorexploreadditional,areascurrentlyortraditionallyinhabitedorusedbyindigenouspeoplesandsubjecttoindigenousrightsorclaims.Accordingly,theCompanyissubjecttotheriskthatoneormoregroupsmayopposethecontinuedoperation,furtherdevelopmentornewdevelopmentoftheCompany'scurrentorfutureproperties.Suchoppositionmaybedirectedthroughlegaloradministrativeproceedings,orthoughprotestsorothercampaignsagainsttheCompany'sactivities.AnysuchactionsmayhaveanadverseimpactontheCompany'soperations.AlthoughtheCompanyattemptstodevelopandmaintaingoodworkingrelationshipswithallstakeholders,therecanbenoassurancethattheserelationshipscanbesuccessfullymanaged.

TheCompany'soperationsaresubjecttonumerouslawsandextensivegovernmentregulationswhichmayrequiresignificantexpendituresorcauseareductioninlevelsofproduction,delaysinproductionorthepreventionofthedevelopmentofnewminingpropertiesorotherwisecausetheCompanytoincurcoststhatadverselyaffecttheCompany'sresultsofoperations.

TheCompany'sminingandmineralprocessingoperations,explorationactivitiesandpropertiesaresubjecttothelawsandregulationsoffederal,provincial,territorial,stateandlocalgovernmentsinthejurisdictionsinwhichtheCompanyoperates.Theselawsandregulationsareextensiveandgovernprospecting,exploration,development,production,exports,taxes,labourstandards,occupationalhealthandsafety,wastedisposalandtailingsmanagement,toxicsubstances,environmentalprotection,minesafety,reportingofpaymentstogovernmentsandothermatters.Compliancewithsuchlawsandregulationsincreasesthecostsofplanning,designing,drilling,developing,constructing,operating,managing,closing,reclaimingandrehabilitatingminesandotherfacilities.Newlawsorregulations,amendmentstocurrentlawsandregulationsgoverningoperationsandactivitiesonminingpropertiesormorestringentimplementationor


interpretationthereofcouldhaveamaterialadverseeffectontheCompany,increasecosts,causeareductioninlevelsofproductionanddelayorpreventthedevelopmentofnewminingproperties.Regulatoryenforcement,intheformofinfractionorcompliancenotices,hasoccurredatsomeoftheCompany'sminesand,whilethecurrentrisksrelatedtosuchenforcementarenotexpectedtobematerial,theriskofmaterialfinesorcorrectiveactioncannotberuledoutinthefuture.

DuetothenatureoftheCompany'sminingoperations,theCompanymayfaceliability,delaysandincreasedproductioncostsfromenvironmentalandindustrialaccidentsandpollution,andtheCompany'sinsurancecoveragemayproveinadequatetosatisfyfutureclaimsagainsttheCompany.

Thebusinessofgoldminingisgenerallysubjecttorisksandhazards,includingenvironmentalhazards(includinghazardoussubstances,suchascyanide),industrialaccidents,unusualorunexpectedrockformations,changesintheregulatoryenvironment,cave-ins,rockbursts,rockfalls,pitwallfailuresandfloodingandgoldbullionlosses.Suchoccurrencescouldresultin,amongotherthings,damageto,ordestructionof,mineralpropertiesorproductionfacilities,personalinjuryordeath,environmentaldamage,delaysinmining,monetarylossesandpossiblelegalliability.Aswell,risksmayarisewithrespecttothemanagementoftailings,wasterock,mineclosureandmanagementofclosedminesites(whethertheCompanyoperatedtheminesiteoracquireditafteroperationswereconductedbyothers).TheCompanycarriesinsurancetoprotectitselfagainstcertainrisksofminingandprocessinginamountsthatitconsiderstobeadequatebutwhichmaynotprovideadequatecoverageincertainunforeseencircumstances.TheCompanymayalsobecomesubjecttoliabilityfor,amongotherthings,pollution,cave-insorotherhazardsagainstwhichitcannotinsureoragainstwhichithaselectednottoinsurebecauseofhighpremiumcostsorotherreasons,ortheCompanymaybecomesubjecttoliabilitieswhichexceedpolicylimits.Inthesecircumstances,theCompanymayincursignificantcoststhatcouldhaveamaterialadverseeffectonitsfinancialperformanceandresultsofoperations.Financialassurancesmayalsoberequiredwithrespecttoclosureandrehabilitationcosts.

IncreasedregulationofgreenhousegasemissionsandclimatechangeissuesmayadverselyaffecttheCompany'soperations.

TheCompanyoperatesinjurisdictionswhereregulatoryrequirementshavetakeneffect,orareproposed,tomonitor,reportand/orreducegreenhousegasemissions.IncreasedregulationofgreenhousegasemissionsandclimatechangeissuesmayadverselyaffecttheCompany'soperations.In2015,Canadaestablishedagreenhousegasesreductiontargetof30%from2005levelsby2030.InDecember2015,CanadasignedtheParisAgreementtolimittheglobalaveragetemperaturerisebelow2oCandpursueeffortstolimittheincreaseto1.5oC.Bythefallof2016,theprovincesandthefederalgovernmenthavecommittedtoagreeonapan-Canadianframeworkoncleangrowthandclimatechange.Canada'sfederalandprovincialregulationsalsoimposemandatorygreenhousegasemissionsreportingrequirementsandtheCompany'sQuebecminesaresubjecttocapandtraderegulation.Similarly,FinlandwasasignatorytotheParisAgreementandparticipatesintheEuropeanUnion'scapandtradesystem.Mexicohasenactedclimatechangelegislationwithagreenhousegasemissionreductiontargetof30%(frombusinessasusuallevels)by2020.

TheCompanymonitorsandreportsannuallyitsdirectandindirectgreenhousegasemissionstotheinternationalCarbonDisclosureProject.InQuebec,theCompanyprimarilyuseshydroelectricpowerandisnotalargeproducerofgreenhousegases.Asaresult,Quebec'sregulatoryrequirementsarenotexpectedtohaveamaterialadverseeffectontheCompany.In2015,theMeadowbankmineproducedapproximately190,000tonnesofgreenhousegases(directandindirect)mostlyfromtheproductionofelectricityfromdieselpowergeneration,whichisapproximately47%oftheCompany'stotalgreenhousegasemissions(withoutaccountingfortheCanadianMalarticmine).ItisexpectedthatanyminingoperationattheMeliadineprojectwillalsoprimarilyusedieselpowergeneration.ThePinosAltosandLaIndiaminespurchaseelectricitythatislargelyfossil-fuelgeneratedand,asaresult,aretheCompany'ssecondandthirdhighestgreenhousegasproducers(approximately105,000tonnesand40,000tonnes,respectively,ofgreenhousegasesin2015),whichcombinedareapproximately35%oftheCompany'stotaldirectandindirectgreenhousegasemissions(withoutaccountingfortheCanadianMalarticmine).In2015,theCanadianMalarticmine'sgreenhousegasproductionwasapproximately155,000tonnes(directandindirect).WhiletheseevolvingregulatoryrequirementsinrespectofgreenhousegasesandtheadditionalcostsrequiredtocomplyarenotexpectedtohaveamaterialadverseeffectontheCompany'soperations,suchrequirementsmaynotbeadoptedascurrentlyproposed,maybeamendedormayhaveunexpectedeffectsontheCompanyand,asaresult,mayhaveamaterialadverseeffectontheCompany'sfinancialperformanceanditsresultsofoperations.


TitletotheCompany'spropertiesmaybeuncertainandsubjecttorisks.

Theacquisitionoftitletomineralpropertiesisaverydetailedandtime-consumingprocess.Titleto,andtheareaof,mineralconcessionsmaybedisputed.AlthoughtheCompanybelievesithastakenreasonablemeasurestoensurepropertitletoitsproperties,thereisnoguaranteethattitletoanyofitspropertieswillnotbechallengedorimpaired.ThirdpartiesmayhavevalidclaimsonunderlyingportionsoftheCompany'sinterests,includingpriorunregisteredliens,agreements,transfersorclaims,includinglandclaimsbyindigenousgroups,andtitlemaybeaffectedby,amongotherthings,undetecteddefects.Inaddition,althoughtheCompanybelievesthatithassufficientsurfacerightsforitsoperations,theCompanymaybeunabletooperateitspropertiesaspermittedortoenforceitsrightsinrespectofitsproperties.

TheCompanyissubjecttotheriskoflitigation,thecausesandcostsofwhichcannotbeknown.

TheCompanyissubjecttolitigationarisinginthenormalcourseofbusinessandmaybeinvolvedindisputeswithotherpartiesinthefuturewhichmayresultinlitigation.Thecausesofpotentialfuturelitigationcannotbeknownandmayarisefrom,amongotherthings,businessactivities,environmentallaws,volatilityinstockpriceorfailureorallegedfailuretocomplywithdisclosureobligations.Forexample,theCompanywasrecentlythesubjectofcertainclassactionlawsuitsrelatingtotheCompany'sdisclosurepriortothesuspensionofminingoperationsattheGoldexmineinOctober2011.See"LegalProceedingsandRegulatoryActions".Theresultsoflitigationcannotbepredictedwithcertainty.IftheCompanyisunabletoresolvelitigationfavourably,eitherbyjudicialdeterminationorsettlement,itmayhaveamaterialadverseeffectontheCompany'sfinancialperformanceandresultsofoperations.

IntheeventofadisputeinvolvingtheforeignoperationsoftheCompany,theCompanymaybesubjecttotheexclusivejurisdictionofforeigncourtsormaynotbesuccessfulinsubjectingforeignpersonstothejurisdictionofcourtsinCanada.TheCompany'sabilitytoenforceitsrightscouldhaveanadverseeffectonitsfuturecashflows,earnings,resultsofoperationsandfinancialcondition.

TheuseofderivativeinstrumentsfortheCompany'sby-productmetalproductionmaypreventgainsfrombeingrealizedfromsubsequentby-productmetalpriceincreases.

WhiletheCompany'sgeneralpolicyisnottosellforwarditsfuturegoldproduction,theCompanyhasused,andmayinthefutureuse,variousby-productmetalderivativestrategies,suchassellingfuturecontractsorpurchasingputoptions.TheCompanycontinuallyevaluatesthepotentialshortandlongtermbenefitsofengaginginsuchderivativestrategiesbaseduponcurrentmarketconditions.Noassurancecanbegiven,however,thattheuseofby-productmetalderivativestrategieswillbenefittheCompanyinthefuture.ThereisapossibilitythattheCompanycouldlockinforwarddeliveriesatpriceslowerthanthemarketpriceatthetimeofdelivery.Inaddition,theCompanycouldfailtoproduceenoughby-productmetalstooffsetitsforwarddeliveryobligations,requiringtheCompanytopurchasethemetalinthespotmarketathigherpricestofulfillitsdeliveryobligationsor,forcashsettledcontracts,makecashpaymentstocounterpartiesinexcessofby-productrevenue.IftheCompanyislockedintoalowerthanmarketpriceforwardcontractorhastobuyadditionalquantitiesathigherprices,itsnetincomecouldbeadverselyaffected.Noneofthecurrentcontractsestablishingtheby-productmetalderivativespositionsqualifyforhedgeaccountingtreatmentunderIFRSandthereforeanyyear-endmark-to-marketadjustmentsarerecognizedinthe"Lossonderivativefinancialinstruments"lineitemoftheconsolidatedstatementsofincome(loss)andcomprehensiveincome.See"RiskProfile–FinancialInstruments"intheAnnualMD&Aforadditionalinformation.

ThetradingpricefortheCompany'ssecuritiesisvolatile.

ThetradingpriceoftheCompany'scommonshareshasbeenandmaycontinuetobesubjecttolargefluctuationswhichmayresultinlossestoinvestors.ThetradingpriceoftheCompany'scommonsharesmayincreaseordecreaseinresponsetoanumberofeventsandfactors,including:

• changesinthemarketpriceofgoldorotherby-productmetalstheCompanysells;

• eventsaffectingeconomiccircumstancesinCanada,theUnitedStatesandelsewhere;

• trendsintheminingindustryandthemarketsinwhichtheCompanyoperates;

• changesinfinancialestimatesandrecommendationsbysecuritiesanalysts;

• acquisitions,divestituresandfinancings;

• quarterlyvariationsinoperatingresults;


• compliancewithnewandexistingregulations,includingwithrespecttotailingsmanagementandgreenhousegasemissions;

• theoperatingandsharepriceperformanceofothercompaniesthatinvestorsmaydeemcomparable;and

• purchasesorsalesoflargeblocksoftheCompany'scommonsharesorsecuritiesconvertibleintoorexchangeablefortheCompany'scommonshares.

WidepriceswingsarecurrentlycommoninthemarketsonwhichtheCompany'ssecuritiestrade.ThisvolatilitymayadverselyaffectthepricesoftheCompany'scommonsharesregardlessoftheCompany'soperatingperformance.

TheCompanyissubjecttoanti-corruptionandanti-briberylaws.

TheCompany'soperationsaregovernedby,andinvolveinteractionswith,variouslevelsofgovernmentinnumerouscountries.TheCompanyisrequiredtocomplywithanti-corruptionandanti-briberylaws,includingtheCorruption of Foreign Public Officials Act (Canada)andtheU.S.ForeignCorruptPracticesAct,aswellassimilarlawsinthecountriesinwhichtheCorporationconductsitsbusiness.Recently,therehasbeenageneralincreaseinthefrequencyofenforcementandtheseverityofpenaltiesundersuchlaws,resultingingreaterscrutinyandpunishmenttocompaniesconvictedofviolatinganti-corruptionandanti-briberylaws.TheCompanymaybefoundliableforviolationsbynotonlyitsemployees,butalsobyitsthirdpartyagents.AlthoughtheCompanyhasadoptedarisk-basedapproachtomitigatesuchrisks,includingtheimplementationofpoliciesandprogramstoensurecompliancewithsuchlaws,suchmeasuresarenotalwayseffectiveinensuringthattheCompany,itsemployeesorthirdpartyagentswillcomplystrictlywithsuchlaws.IftheCompanyfindsitselfsubjecttoanenforcementactionorisfoundtobeinviolationofsuchlaws,thismayresultinsignificantpenalties,finesand/orsanctionsimposedontheCompanywhichcouldresultinamaterialadverseeffectontheCompany'sreputation,financialperformanceandresultsofoperations.

TheCompanyisdependentoninformationtechnologysystems.

TheCompany'soperationsdepend,inpart,uponinformationtechnologysystems.TheCompany`sinformationtechnologysystemsaresubjecttodisruption,damageorfailurefromanumberofsources,including,butnotlimitedto,computerviruses,securitybreaches,naturaldisasters,powerlossanddefectsindesign.AlthoughtodatetheCompanyhasnotexperiencedanymateriallossesrelatingtoinformationtechnologysystemdisruptions,damageorfailure,therecanbenoassurancethatitwillnotincursuchlossesinfuture.Anyoftheseandothereventscouldresultininformationtechnologysystemsfailures,operationaldelays,productiondowntimes,destructionorcorruptionofdata,securitybreachesorothermanipulationorimproperuseoftheCompany`ssystemsandnetworks,anyofwhichcouldhaveadverseeffectsontheCompany`sreputation,resultsofoperationsandfinancialperformance.

TheCompanymaynotbeabletocomplywiththerequirementsofSection404oftheSarbanes-OxleyAct.

Section404oftheSarbanes-OxleyActof2002("SOX")requiresanannualassessmentbymanagementoftheeffectivenessoftheCompany'sinternalcontroloverfinancialreporting.Section404ofSOXalsorequiresanannualattestationreportbytheCompany'sindependentauditorsaddressingtheeffectivenessoftheCompany'sinternalcontroloverfinancialreporting.TheCompanyhascompleteditsSection404assessmentandreceivedtheauditors'attestationasofDecember31,2015.

IftheCompanyfailstomaintaintheadequacyofitsinternalcontroloverfinancialreporting,assuchstandardsaremodified,supplementedoramendedfromtimetotime,theCompanymaynotbeabletoconcludethatithaseffectiveinternalcontroloverfinancialreportinginaccordancewithSection404ofSOX.TheCompany'sfailuretosatisfytherequirementsofSection404ofSOXonanongoing,timelybasiscouldresultinthelossofinvestorconfidenceinthereliabilityofitsfinancialstatements,whichinturncouldharmtheCompany'sbusinessandnegativelyimpactthetradingpriceofitscommonsharesormarketvalueofitsothersecurities.Inaddition,anyfailuretoimplementrequiredneworimprovedcontrols,ordifficultiesencounteredintheirimplementation,couldharmtheCompany'soperatingresultsorcauseittofailtomeetitsreportingobligations.FutureacquisitionsofcompaniesmayprovidetheCompanywithchallengesinimplementingtherequiredprocesses,proceduresandcontrolsinitsacquiredoperations.AcquiredcompaniesmaynothavedisclosurecontrolsandproceduresorinternalcontroloverfinancialreportingthatareasthoroughoreffectiveasthoserequiredbysecuritieslawscurrentlyapplicabletotheCompany.


NoevaluationcanprovidecompleteassurancethattheCompany'sinternalcontroloverfinancialreportingwillpreventmisstatementduetoerrororfraudorwilldetectoruncoverallcontrolissuesorinstancesoffraud,ifany.TheeffectivenessoftheCompany'scontrolsandprocedurescouldalsobelimitedbysimpleerrorsorfaultyjudgments.Inaddition,astheCompanycontinuestoexpand,thechallengesinvolvedinmaintainingadequateinternalcontroloverfinancialreportingwillincreaseandwillrequirethattheCompanycontinuetoimproveitsinternalcontroloverfinancialreporting.TheCompanycannotbecertainthatitwillbesuccessfulincontinuingtocomplywithSection404ofSOX.

DIVIDENDS TheCompany'scurrentpolicyistopayquarterlydividendsonitscommonsharesand,onFebruary10,2016,theCompanydeclaredaquarterlydividendof$0.08percommonshare,payableonMarch15,2016.In2015,thedividendpaidwas$0.32percommonshare(quarterlypaymentsof$0.08percommonshare).In2014,thedividendpaidwas$0.32percommonshare(quarterlypaymentsof$0.08percommonshare).In2013,thedividendpaidwas$0.88percommonshare(quarterlypaymentsof$0.22percommonshare).AlthoughtheCompanyexpectstocontinuepayingacashdividend,futuredividendswillbeatthediscretionoftheBoardandwillbesubjecttofactorssuchastheCompany'searnings,financialconditionandcapitalrequirements.TheCompany'sbankcreditfacilitycontainsacovenantthatrestrictstheCompany'sabilitytodeclareorpaydividendsifcertaineventsofdefaultunderthebankcreditfacilityhaveoccurredandarecontinuing.

DESCRIPTION OF CAPITAL STRUCTURE TheCompany'sauthorizedcapitalconsistsofanunlimitednumberofsharesofoneclassdesignatedascommonshares.AlloutstandingcommonsharesoftheCompanyarefullypaidandnon-assessable.Theholdersofthecommonsharesareentitledtoonevotepershareatmeetingsofshareholdersandtoreceivedividendsif,asandwhendeclaredbythedirectorsoftheCompany.Intheeventofvoluntaryorinvoluntaryliquidation,dissolutionorwinding-upoftheCompany,afterpaymentofalloutstandingdebts,theremainingassetsoftheCompanyavailablefordistributionwouldbedistributedrateablytotheholdersofthecommonshares.HoldersofthecommonsharesoftheCompanyhavenopre-emptive,redemption,exchangeorconversionrights.TheCompanymaynotcreateanyclassorseriesofsharesormakeanymodificationtotheprovisionsattachingtotheCompany'scommonshareswithouttheaffirmativevoteoftwo-thirdsofthevotescastbytheholdersofthecommonshares.

RATINGS TheratingoftheCompany'snotes(the"Notes")issuedundertheNotePurchaseAgreements(asdefinedunder"MaterialContracts–NotePurchaseAgreements")bytheratingagencyDominionBondRatingService("DBRS")asatDecember31,2015isBBB(low)withastableoutlook.

DBRS'slong-termcreditratingsareonaratingscalethatrangesfromAAAtoD,whichrepresentstherangefromhighesttolowestqualityofsecuritiesrated.DBRS'sBBBratingassignedtotheCompany'sNotesisthefourthhighestofthetenratingcategoriesforlong-termdebt.Debtsecuritiesrated"BBB"areofadequatecreditquality,andthecapacityforthepaymentoffinancialobligationsisconsideredacceptable.However,theobligorisfairlysusceptibletoadversechangesinfinancialandeconomicconditions,ortheremaybeotheradverseconditionspresentwhichreducethestrengthoftheobligor.Areferenceto"high"or"low"reflectstherelativestrengthwithintheratingcategory.DBRShasalsoassignedastableoutlooktotherating,whichindicatesthedirectionDBRSconsiderstheratingisheadedshouldpresenttrendscontinue.

TheCompanyunderstandsthattheratingisbasedon,amongotherthings,informationfurnishedtoDBRSbytheCompanyandinformationobtainedbyDBRSfrompubliclyavailablesources.ThecreditratinggiventotheCompany'sNotesbyDBRSisnotarecommendationtobuy,holdorselldebtinstrumentssincesuchratingdoesnotcommentastomarketpriceorsuitabilityforaparticularinvestor.Thereisnoassurancethatanyratingwillremainineffectforanygivenperiodoftimeorthatanyratingwillnotberevisedorwithdrawnentirelybyaratingagencyinthefutureif,initsjudgment,circumstancessowarrant.Creditratingsareintendedtoprovideinvestorswith:(i)anindependentmeasureofthecreditqualityofanissueofsecurities;(ii)anindicationofthelikelihoodofrepaymentforanissueofsecurities;and(iii)anindicationofthecapacityandwillingnessoftheissuertomeetitsfinancialobligationsinaccordancewiththetermsofthosesecurities.ThecreditratingaccordedtotheNotesmaynotreflectthepotentialimpactofallrisksonthevalueofdebtinstruments,includingrisksrelatedtomarketorotherfactorsdiscussedinthisAIF.IfDBRSlowersthecreditratingonthe


Notes,particularlyadowngradebelowinvestmentgrade,itcouldadverselyaffecttheCompany'scostoffinancingandaccesstoliquidityandcapital.Seealso"RiskFactors".

MARKET FOR SECURITIES Common Shares

TheCompany'scommonsharesarelistedandtradedontheTSXandontheNewYorkStockExchange(the"NYSE")underthesymbol"AEM".OnMarch15,2016theclosingpriceofthecommonshareswasC$47.84ontheTSXand$35.77ontheNYSE.

ThefollowingtablesetsforththehighandlowsalepricesandtheaveragedailytradingvolumefortheCompany'scommonsharesontheTSXandtheNYSEsinceJanuary1,2015.

TSX NYSE

High (C$)

Low (C$)

Average Daily

VolumeHigh

($)Low ($)

Average Daily Volume

2015 January 43.33 28.32 1,388,630 34.36 24.19 3,678,679

February 43.70 37.70 882,847 34.78 29.95 2,560,368

March 41.07 34.30 783,142 33.00 26.90 2,213,522

April 38.98 35.40 843,464 32.24 28.18 2,106,896

May 41.69 36.36 905,772 34.89 30.08 2,054,470

June 40.95 35.08 727,489 32.82 28.15 1,621,640

July 38.07 27.86 920,818 30.10 21.40 2,785,944

August 36.54 27.63 1,146,806 27.91 21.00 3,970,144

September 34.82 28.15 1,054,256 26.14 21.22 3,757,598

October 39.57 32.48 1,176,610 30.69 24.47 3,449,670

November 37.28 33.00 756,635 28.39 24.80 2,278,844

December 39.08 34.80 779,011 29.15 24.93 2,057,544

2016 January 42.67 37.07 1,133,064 30.29 26.10 2,994,987

February 51.49 40.68 1,248,981 37.24 28.95 3,523,566

March(toMarch15) 48.78 44.07 1,330,000 36.79 32.87 3,156,848


DIRECTORS AND OFFICERS OF THE COMPANY Directors

ThefollowingisabriefbiographyofeachoftheCompany'sdirectors:

Dr.LeanneM.Baker,ofSebastopol,California,isanindependentdirectorofAgnicoEagle.FromNovember2011untilJune2013,Dr.BakerwasthePresidentandChiefExecutiveOfficerofSutterGoldMiningInc.Previously,Dr.BakerwasemployedbySalomonSmithBarneywhereshewasoneofthetop-rankedminingsectorequityanalystsintheUnitedStates.Dr.BakerisagraduateoftheColoradoSchoolofMines(M.S.andPh.D.inmineraleconomics).Dr.BakerhasbeenadirectorofAgnicoEaglesinceJanuary1,2003,andisalsoadirectorofSutterGoldMiningInc.(aminingexplorationcompanytradedontheTSX-VandtheOTCQX),ReunionGoldCorporation(aminingexplorationcompanytradedontheTSX-V)andMcEwenMiningInc.(agoldandsilverproducingcompanytradedontheNYSEArcaandtheTSX).Area of expertise: CorporateFinanceandMineralEconomics.

SeanBoyd,CPA,CA,ofToronto,Ontario,istheVice-ChairmanandChiefExecutiveOfficerandadirectorofAgnicoEagle.Mr.BoydhasbeenwithAgnicoEaglesince1985.PriortohisappointmentasVice-ChairmanandChiefExecutiveOfficerinApril2015,Mr.BoydservedasVice-Chairman,PresidentandChiefExecutiveOfficerfrom2012to2015,Vice-ChairmanandChiefExecutiveOfficerfrom2005to2012andasPresidentandChiefExecutiveOfficerfrom1998to2005,Vice-PresidentandChiefFinancialOfficerfrom1996to1998,TreasurerandChiefFinancialOfficerfrom1990to1996,SecretaryTreasurerduringaportionof1990andComptrollerfrom1985to1990.PriortojoiningAgnicoEaglein1985,hewasastaffaccountantwithClarksonGordon(Ernst&Young).Mr.BoydisaCharteredAccountantandagraduateoftheUniversityofToronto(B.Comm.).Mr.BoydhasbeenadirectorofAgnicoEaglesinceApril14,1998.Area of expertise: ExecutiveManagementandFinance.

MartineA.Celej,ofToronto,Ontario,isanindependentdirectorofAgnicoEagle.Ms.CelejiscurrentlyaVice-President,InvestmentAdvisorwithRBCDominionSecuritiesandhasbeenintheinvestmentindustrysince1989.SheisagraduateofVictoriaCollegeattheUniversityofToronto(B.A.(Honours)).Ms.CelejhasbeenadirectorofAgnicoEaglesinceFebruary14,2011.Area of expertise: InvestmentManagement.

RobertJ.Gemmell,ofToronto,Ontario,isanindependentdirectorofAgnicoEagle.Nowretired,Mr.Gemmellspent25yearsasaninvestmentbankerintheUnitedStatesandinCanada.Mostrecently,hewasPresidentandChiefExecutiveOfficerofCitigroupGlobalMarketsCanadaanditspredecessorcompanies(SalomonBrothersCanadaandSalomonSmithBarneyCanada)from1996to2008.Inaddition,hewasamemberoftheGlobalOperatingCommitteeofCitigroupGlobalMarketsfrom2006to2008.Mr.GemmellisagraduateofCornellUniversity(B.A.),OsgoodeHallLawSchool(LL.B.)andtheSchulichSchoolofBusiness(M.B.A.).Mr.GemmellhasbeenadirectorofAgnicoEaglesinceJanuary1,2011.Area ofexpertise: CorporateFinanceandBusinessStrategy.

MelLeiderman,FCPA,FCA,TEP,ICD.D,ofToronto,Ontario,isanindependentdirectorofAgnicoEagle.Mr.LeidermanistheseniorpartneroftheTorontoaccountingfirmLiptonLLP,CharteredAccountants.HeisagraduateoftheUniversityofWindsor(B.A.)andisacertifieddirectoroftheInstituteofCorporateDirectors(ICD.D).HehasbeenadirectorofAgnicoEaglesinceJanuary1,2003andisalsoadirectorandachairmanoftheAuditCommitteeofMorguardNorthAmericanResidentialREIT.Area of expertise: AuditandAccounting.

DeborahMcCombe,P.Geo.ofToronto,Ontario,isanindependentdirectorofAgnicoEagle.Mrs.McCombeisthePresidentandCEOofRoscoePostleAssociatesInc.,aminingconsultantfirm("RPA").Shehasover30years'ofinternationalexperienceinexplorationprojectmanagement,feasibilitystudies,reserveestimation,duediligencestudiesandvaluationstudies.PriortojoiningRPA,Ms.McCombewasChiefMiningConsultantfortheOntarioSecuritiesCommissionandwasinvolvedinthedevelopmentandimplementationofNI43-101.SheisactivelyinvolvedinindustryassociationsasamemberoftheCommitteeforMineralReservesInternationalReportingStandards–(CIM);PresidentoftheAssociationofProfessionalGeoscientistsofOntario(2010–2011);aDirectoroftheProspectorsandDevelopersAssociationofCanada(1999–2011);aCIMDistinguishedLectureronNI43-101;amemberoftheCIMStandingCommitteeonReserveDefinitions;amemberoftheCanadianSecuritiesAdministratorsMiningTechnicalAdvisoryandMonitoringCommittee;andaGuestLecturerattheSchulichSchoolofBusiness(M.B.A.)inGlobalMineManagementatYorkUniversity.Ms.McCombeholdsadegreeinGeologyfromtheUniversityofWesternOntario.Ms.McCombehasbeenadirectorofAgnicoEaglesinceFebruary12,2014.Area of expertise: ExecutiveManagementandMining.

JamesD.Nasso,ICD.D,ofToronto,Ontario,isChairmanoftheBoardofDirectorsandanindependentdirectorofAgnicoEagle.Mr.Nassoisnowretired.Mr.NassoisagraduateofSt.FrancisXavierUniversity(B.Comm.)andisacertifieddirectoroftheInstituteofCorporateDirectors(ICD.D).Mr.NassohasbeenadirectorofAgnicoEaglesinceJune27,1986.Area of expertise: ManagementandBusinessStrategy.


Dr.SeanRiley,ofAntigonish,NovaScotia,isanindependentdirectorofAgnicoEagle.Nowretired,Dr.RileyservedasPresidentofSt.FrancisXavierUniversityfrom1996to2014.Priorto1996,hiscareerwasinfinanceandmanagement,firstincorporatebankingandlaterinmanufacturing.Dr.RileyisagraduateofSt.FrancisXavierUniversity(B.A.(Honours))andofOxfordUniversity(M.Phil,D.Phil,InternationalRelations).Dr.RileyhasbeenadirectorofAgnicoEaglesinceJanuary1,2011.Area of expertise :ManagementandBusinessStrategy.

J.MerfynRoberts,CA,ofLondon,England,isanindependentdirectorofAgnicoEagle.Mr.Roberts,nowretired,wasafundmanagerandinvestmentadvisorformorethan25yearsandhasbeencloselyassociatedwiththeminingindustry.From2007untilhisretirementin2011,hewasaseniorfundmanagerwithCQSManagementLtd.inLondon.Mr.RobertsisagraduateofLiverpoolUniversity(B.Sc.,Geology)andOxfordUniversity(M.Sc.,Geochemistry)andisamemberoftheInstituteofCharteredAccountantsinEnglandandWales.Mr.RobertshasbeenadirectorofAgnicoEaglesinceJune17,2008,andisalsoadirectorandamemberoftheAuditCommitteeofEasternPlatinumLimitedandNewportExplorationLimitedandadirectorofBlackheathResourcesInc.Area of expertise: InvestmentManagement.

JamieSokalsky,CPA,CA,ofToronto,Ontario,isanindependentdirectorofAgnicoEagle.Nowretired,Mr.Sokalskyhasover20years'experienceasaseniorexecutiveintheminingindustry,mostrecentlyasChiefExecutiveOfficerandPresidentofBarrickGoldCorporation("Barrick")fromJune2012toSeptember2014,andasChiefFinancialOfficerofBarrickfrom1999toJune2012andExecutiveVicePresidentofBarrickfromApril2004toJune2012.Priortoenteringtheminingindustry,Mr.Sokalskyservedfor10yearsatGeorgeWestonLimitedandbeganhisprofessionalcareeratErnst&WhinneyCharteredAccountants(KPMG).Mr.SokalskyisgraduateofLakeheadUniversity(B.Comm.(Honours)).Mr.SokalskyhasbeenadirectorofAgnicoEaglesinceJune2,2015,andisalsotheChairmanoftheBoardofDirectorsofProbeMetalsInc.andadirectorofPengrowthEnergyCorporationandRoyalGold,Inc.Area of expertise: ExecutiveManagement,FinanceandAccounting.

HowardR.Stockford,P.Eng.,ofToronto,Ontario,isanindependentdirectorofAgnicoEagle.Mr.Stockfordisaretiredminingexecutivewith50yearsofexperienceintheindustry.Mostrecently,hewasExecutiveVice-PresidentofAurResourcesInc.("Aur")andadirectorofAurfrom1984untilAugust2007,whenitwastakenoverbyTeckComincoLimited.Mr.StockfordhaspreviouslyservedasPresidentoftheCIMandisamemberoftheAssociationofProfessionalEngineersofOntario,theProspectorsandDevelopersAssociationofCanadaandtheSocietyofEconomicGeologists.Mr.StockfordisagraduateoftheRoyalSchoolofMines,ImperialCollege,LondonUniversity,U.K.(B.Sc.,MiningGeology).Mr.StockfordhasbeenadirectorofAgnicoEaglesinceMay6,2005.Area of expertise: ExecutiveManagementandMining.

PerttiVoutilainen,M.Sc.,M.Eng.,ofEspoo,Finland,isanindependentdirectorofAgnicoEagle.Mr.Voutilainenisaminingindustryveteran.Until2005,hewastheChairmanoftheboardofdirectorsofRiddarhyttanResourcesAB.Previously,Mr.VoutilainenwastheChairmanoftheboardofdirectorsandChiefExecutiveOfficerofKansallisBankingGroupandPresidentafteritsmergerwithUnionBankofFinlanduntilhisretirementin2000.HewasalsoemployedbyOutokumpuCorp.,Finland'slargestminingandmetalscompany,for26years,includingasChiefExecutiveOfficerfor11years.Mr.VoutilainenholdsthehonorarytitleofMiningCounselor(Bergsrad),whichwasawardedtohimbythePresidentoftheRepublicofFinlandin2003.Mr.VoutilainenisagraduateofHelsinkiUniversityofTechnology(M.Sc.),HelsinkiUniversityofBusinessAdministration(M.Sc.)andPennsylvaniaStateUniversity(M.Eng.).HehasbeenadirectorofAgnicoEaglesinceDecember13,2005.Area of expertise: MiningandFinance.

Theby-lawsofAgnicoEagleprovidethatdirectorswillholdofficeforatermexpiringatthenextannualmeetingofshareholdersofAgnicoEagleoruntiltheirsuccessorsareelectedorappointedorthepositionisvacated.TheBoardannuallyappointstheofficersofAgnicoEagle,whoaresubjecttoremovalbyresolutionoftheBoardatanytime,withorwithoutcause(intheabsenceofawrittenagreementtothecontrary).

Committees

ThemembersoftheAuditCommitteeareDr.LeanneM.Baker(Chair),MelLeiderman,Dr.SeanRileyandMr.JamieSokalsky.

ThemembersoftheCompensationCommitteeareRobertJ.Gemmell(Chair),MartineA.Celej,J.MerfynRobertsandHowardR.Stockford.

ThemembersoftheCorporateGovernanceCommitteearePerttiVoutilainen(Chair),JamesD.NassoandJ.MerfynRoberts.

ThemembersoftheHealth,Safety,EnvironmentalandSustainableDevelopmentCommitteeareDeborahMcCombe(Chair),JamesD.NassoandHowardR.Stockford.


Officers

ThefollowingisabriefbiographyofeachoftheCompany'sofficers(forMr.Boyd,see"DirectorsandOfficersoftheCompany–Directors"):

AmmarAl-Joundi,ofToronto,Ontario,isPresidentofAgnicoEagle,apositionhehasheldsinceApril6,2015.FromSeptember2010toJune2012,Mr.Al-JoundiwasSeniorVice-PresidentandChiefFinancialOfficerofAgnicoEagle.PriortoreturningtoAgnicoEaglein2015,Mr.Al-JoundiservedinvariousrolesatBarrick,includingasChiefFinancialOfficerfromJuly2012toFebruary2015,SeniorExecutiveVicePresidentfromJuly2014toFebruary2015andExecutiveVicePresidentfromJuly2012toJuly2014.PriortojoiningAgnicoEaglein2010,Mr.Al-Joundispent11yearsatBarrickservinginvariousseniorfinancialroles,includingSeniorVicePresidentofCapitalAllocationandBusinessStrategy,SeniorVicePresidentofFinance,andExecutiveDirectorandChiefFinancialOfficerofBarrickSouthAmerica.Priortojoiningtheminingindustry,Mr.Al-JoundiservedasVicePresident,StructuredFinanceatCitibank,Canada.Mr.Al-JoundiisagraduateofWesternUniversity(M.B.A.(Honours))andtheUniversityofToronto(BASc(MechanicalEngineering)).

DonaldG.Allan,CPA,CA, ofToronto,Ontario,isSeniorVice-President,CorporateDevelopmentofAgnicoEagle,apositionhehasheldsinceDecember14,2006.Priortothat,Mr.AllanhadbeenVice-President,CorporateDevelopmentsinceMay6,2002.Priortothat,Mr.Allanspent16yearsasaninvestmentbankercoveringtheminingandnaturalresourcessectorswiththefirmsSalomonSmithBarneyandMerrillLynch.Mr.AllanisagraduateoftheAmosTuckSchool,DartmouthCollege(M.B.A.)andtheUniversityofToronto(B.Comm.).Mr.AllanisalsoqualifiedasaCharteredAccountant.

AlainBlackburn,P.Eng.,ofOakville,Ontario,isSeniorVice-President,ExplorationofAgnicoEagle,apositionhehasheldsinceDecember14,2006.Priortothat,Mr.BlackburnhadbeenVice-President,ExplorationsinceOctober1,2002.Priortothat,Mr.BlackburnservedasAgnicoEagle'sManager,CorporateDevelopmentfromJanuary1999andExplorationManagerfromSeptember1996toJanuary1999.Mr.BlackburnjoinedAgnicoEaglein1988asChiefGeologistattheLaRondemine.Mr.BlackburnisagraduateofUniversitéduQuebecdeChicoutimi(P.Eng.)andUniversitéduQuebecenAbitibi-Temiscamingue(M.Sc.).

PickluDatta,CPA,CA,ofToronto,OntarioisSeniorVice-President,TreasuryandFinanceofAgnicoEagle,apositionhehasheldsinceOctober24,2012.Mr.DattawaspreviouslyVice-President,Treasurerandpriortothat,hewasVice-President,ControllerofAgnicoEagle.PriortojoiningAgnicoEaglein2005,Mr.DattaworkedatPhilipMorrisCompaniesinNewYorkCityforapproximatelyeightyearsandthetechnologyindustryforthreeyearsinvariousfinancialmanagementroles.Mr.DattaisagraduateoftheUniversityofToronto(B.Comm.)andacquiredhisCharteredAccountancydesignationbyarticlingwithPricewaterhouseCoopers.

LouiseGrondin,Ing.P.Eng.,ofToronto,Ontario,isSeniorVice-President,Environment,SustainableDevelopmentandPeopleofAgnicoEagle,apositionshehasheldsinceFebruary2015.Priortothat,Ms.GrondinwasSeniorVice-President,EnvironmentandSustainableDevelopmentandbeforethatshewasVice-President,EnvironmentandSustainableDevelopment.PriortoheremploymentwithAgnicoEagle,Ms.GrondinworkedforBillitonCanadaLtd.asManagerEnvironment,HumanResourcesandSafety.Ms.GrondinisagraduateoftheUniversityofOttawa(B.Sc.)andMcGillUniversity(M.Sc.).Ms.GrondinisamemberoftheProfessionalEngineersofOntariosince1984andoftheOrdredesIngénieursduQuébecsince2001.

TimHaldane,P.Eng.,ofTucson,Arizona,isSeniorVice-President,Operations–USA&LatinAmericaofAgnicoEagle,apositionhehasheldsinceFebruary15,2014.Priortothat,Mr.HaldanewasSeniorVice-President,LatinAmerica.PriortojoiningAgnicoEagleinMay2006,hewasVicePresident,DevelopmentforGlamisGoldInc.Mr.HaldanehasparticipatedinnumerousacquisitionanddevelopmentactivitiesinNorthAmericaandCentralAmerica,mostrecentlyincludingthePinosAltos,CrestonMascotaandLaIndiapropertiesforAgnicoEagle.HeisagraduateoftheMontanaSchoolofMinesandTechnology(B.S.MetallurgicalEngineering)andhas35yearsofexperienceinthepreciousmetalsandbasemetalsindustries.

R.GregoryLaing, ofOakville,Ontario,isGeneralCounsel,SeniorVice-President,LegalandCorporateSecretaryofAgnicoEagle,apositionhehasheldsinceDecember14,2006,priortowhich,Mr.LainghadbeenGeneralCounsel,Vice-President,LegalandCorporateSecretarysinceSeptember19,2005.Priortothat,hewasVicePresident,LegalofGoldcorpInc.fromOctober2003toJune2005andGeneralCounsel,VicePresident,LegalandCorporateSecretaryofTVXGoldInc.fromOctober1995toJanuary2003.HeworkedasacorporatesecuritieslawyerfortwoprominentTorontolawfirmspriortothat.Mr.LaingisagraduateoftheUniversityofWindsor(LL.B.)andQueen'sUniversity(B.A.).

MarcHubertLegault,P.Eng,ofMississauga,Ontario,isSeniorVice-President,ProjectEvaluationsofAgnicoEagle,apositionhehasheldsinceFebruary2012.Priortothat,hewasVice-President,ProjectDevelopmentsince2007.Mr.LegaulthasbeenwithAgnicoEaglesince1988,whenhewashiredasanexplorationgeologistinVald'Or,Quebec.


Sincethen,hehastakenonsuccessivelyincreasingresponsibilitiesintheCompany'sexploration,minegeologyandprojectevaluationactivities.Mr.LegaultisagraduateofCarletonUniversity(M.Sc.inGeology)andQueen'sUniversity(B.Sc.H.inGeologicalEngineering).Mr.LegaultisaregisteredProfessionalEngineer.

JeanRobitaille,ofOakville,Ontario,isSeniorVice-President,BusinessStrategyandTechnicalServicesofAgnicoEagle,apositionhehasheldsinceFebruary2014.Priortothat,heheldvariouspositionswithAgnicoEaglesince1988,mostrecentlyasSeniorVice-President,TechnicalServicesandProjectDevelopment,Vice-President,Metallurgy&Marketing,GeneralManager,Metallurgy&MarketingandMillSuperintendentandProjectManagerfortheexpansionoftheLaRondemill.PriortojoiningAgnicoEagle,Mr.RobitailleworkedasametallurgistwithTeckMiningGroup.Mr.RobitailleisadirectorofPershimcoResourcesInc.(aminingexplorationcompany)tradedontheTSX-VandhasservedontheboardofdirectorsoftheCanadaMiningInnovationCouncilsinceMay2014.Mr.RobitailleisamininggraduateoftheCollegedel'AbitibiTémiscaminguewithaspecialtyinmineralprocessing.

DavidSmith,P.Eng.,ofToronto,Ontario,isSeniorVice-President,FinanceandChiefFinancialOfficerofAgnicoEagle,apositionhehasheldsinceOctober24,2012.Priortothat,hewasSeniorVice-President,StrategicPlanningandInvestorRelations,apositionheheldsinceJanuary1,2011,priortothathewasSeniorVice-President,InvestorRelationsandpriortothathewasVice-President,InvestorRelations.HestartedworkininvestorrelationsatAgnicoEagleinFebruary2005.Priortothat,Mr.Smithwasamininganalystformorethanfiveyearsandheldavarietyofminingengineeringpositions,bothinCanadaandabroad.Mr.SmithisaCharteredDirector,amemberoftheBoardofDirectorsoftheDenverGoldGroupandanalternateDirectoroftheWorldGoldCouncil.HeisagraduateofQueen'sUniversity(B.Sc.)andtheUniversityofArizona(M.Sc.).Mr.SmithisalsoaProfessionalEngineer.

YvonSylvestre,ofMississauga,Ontario,isSeniorVice-President,Operations–Canada&Europe,apositionhehasheldsinceFebruary2014.Priortothat,hewasSeniorVice-President,Operations,Vice-President,Construction,MineGeneralManagerattheGoldexdivisionofAgnicoEagleand,previously,MillSuperintendentattheLaRondedivision.Mr.SylvestreisaMetallurgicalEngineeringTechnologygraduatefromCambrianCollegeinSudbury.Followinggraduation,heservedasMetallurgistandMillSuperintendentattheJouteldivisionofAgnicoEagleandalsoheldthepositionofMillSuperintendentattheTrollusdivisionofInmetMiningCorporation.

Shareholdings of Directors and Officers

AsatMarch15,2016,thedirectorsandofficersofAgnicoEagle,asagroup,beneficiallyowned,orcontrolledordirected,directlyorindirectly,anaggregateof427,077commonsharesorapproximately0.2%ofthe220,993,605issuedandoutstandingcommonshares.

Cease Trade Orders, Bankruptcies, Penalties or Sanctions

NodirectororofficeroftheCompanyis,orwithintenyearspriortothedatehereofhasbeen,adirector,chiefexecutiveofficerorchieffinancialofficerofanycompany(includingtheCompany)that:(i)wassubjecttoaceasetradeorder,anordersimilartoaceasetradeorderoranorderthatdeniedtherelevantcompanyaccesstoanyexemptionundersecuritieslegislation,thatwasineffectforaperiodofmorethan30consecutivedays,thatwasissuedwhilethedirectororofficerwasactinginthecapacityasdirector,chiefexecutiveofficerorchieffinancialofficer;or(ii)wassubjecttoaceasetradeorder,anordersimilartoaceasetradeorderoranorderthatdeniedtherelevantcompanyaccesstoanyexemptionundersecuritieslegislation,thatwasineffectforaperiodofmorethan30consecutivedays,thatwasissuedafterthedirectororofficerceasedtobeadirector,chiefexecutiveofficerorchieffinancialofficerandwhichresultedfromaneventthatoccurredwhilethatpersonwasactinginthecapacityasdirector,chiefexecutiveofficerorchieffinancialofficer.

Exceptasdescribedbelow,nodirectororofficeroftheCompany,orashareholderholdingasufficientnumberofsecuritiesoftheCompanytoaffectmateriallythecontroloftheCompany:(i)is,orwithintenyearspriortothedatehereofhasbeen,adirectororofficerofanycompany(includingtheCompany)that,whilethatpersonwasactinginthatcapacity,orwithinayearofthatpersonceasingtoactinthatcapacity,becamebankrupt,madeaproposalunderanylegislationrelatingtobankruptcyorinsolvencyorwassubjecttoorinstitutedanyproceedings,arrangementorcompromisewithcreditorsorhadareceiver,receivermanagerortrusteeappointedtoholditsassets;or(ii)has,withintenyearspriortothedatehereof,becomebankrupt,madeaproposalunderanylegislationrelatingtobankruptcyorinsolvency,orbecomesubjecttoorinstitutedanyproceedings,arrangementorcompromisewithcreditors,orhadareceiver,receivermanagerortrusteeappointedtoholdtheassetsofthedirector,officerorshareholder.

NodirectororofficeroftheCompany,orashareholderholdingasufficientnumberofsecuritiesoftheCompanytoaffectmateriallythecontroloftheCompany,hasbeensubjectto:(i)anypenaltiesorsanctionsimposedbyacourtrelatingtosecuritieslegislationorbyasecuritiesregulatoryauthorityorhasenteredintoasettlementagreementwithasecurities


regulatoryauthority;or(ii)anyotherpenaltiesorsanctionsimposedbyacourtorregulatorybodythatwouldlikelybeconsideredimportanttoareasonableinvestorinmakinganinvestmentdecision.

Mr.Leiderman,adirectoroftheCompany,wasadirectorofColossusMineralsInc.("Colossus")fromAugust1,2011untilhisresignationonNovember13,2013.OnFebruary7,2014,ColossusfiledaproposaltoitscreditorsundertheBankruptcy and Insolvency Act (Canada).OnFebruary25,2014,theresolutionapprovinganamendedproposalwasapprovedbytherequisitemajorityofColossus'creditors.OnApril30,2014,Colossusannouncedthatithadcompletedtheimplementationofthecourt-approvedproposal.

Conflicts of Interest

TothebestoftheCompany'sknowledge,andotherthanasdisclosedinthisAIF,therearenoknownexistingorpotentialconflictsofinterestbetweentheCompanyandanydirectororofficeroftheCompany,exceptthatcertainofthedirectorsandofficersoftheCompanyserveasdirectorsandofficersofotherpubliccompaniesandthereforeitispossiblethataconflictmayarisebetweentheirdutiesasadirectororofficeroftheCompanyandtheirdutiesasadirectororofficerofsuchothercompany.

AUDIT COMMITTEE TheAuditCommitteehastwoprimaryobjectives.ThefirstistoadvisetheBoardofDirectorsinitsoversightresponsibilitiesregarding:

• thequalityandintegrityoftheCompany'sfinancialreportsandinformation;

• theCompany'scompliancewithlegalandregulatoryrequirements;

• theeffectivenessoftheCompany'sinternalcontrolsforfinance,accounting,internalaudit,ethicsandlegalandregulatorycompliance;

• theperformanceoftheCompany'sauditing,accountingandfinancialreportingfunctions;

• thefairnessofrelatedpartyagreementsandarrangementsbetweentheCompanyandrelatedparties;and

• theindependentauditors'performance,qualificationsandindependence.

ThesecondprimaryobjectiveoftheAuditCommitteeistopreparethereportsrequiredtobeincludedinmanagementinformationcircularsoftheCompanyinaccordancewithapplicablelawsortherulesofapplicablesecuritiesregulatoryauthorities.

TheBoardhasadoptedanAuditCommitteecharter,whichprovidesthateachmemberoftheAuditCommitteemustbeunrelatedtoandindependentfromtheCompanyasdeterminedbytheBoardinaccordancewiththeapplicablerequirementsofthelawsgoverningtheCompany,thestockexchangesonwhichtheCompany'ssecuritiesarelistedandapplicablesecuritiesregulatoryauthorities.Inaddition,eachmembermustbefinanciallyliterateandatleastonememberoftheAuditCommitteemustbeanauditcommitteefinancialexpert,asthetermisdefinedintherulesoftheSEC.TheAuditCommitteecharterisattachedasScheduleAtothisAIF.

Composition of the Audit Committee

TheAuditCommitteeiscomposedentirelyofdirectorswhoareunrelatedtoandindependentfromtheCompany(currently,Dr.Baker(Chair),Mr.Leiderman,Dr.RileyandMr.Sokalsky),eachofwhomisfinanciallyliterate,asthetermisusedintheCSA'sMultilateralInstrument52-110–Audit Committees .Inaddition,Mr.LeidermanandMr.SokalskyareCharteredAccountants;theBoardhasdeterminedthatbothofthemqualifyasanauditcommitteefinancialexperts,asthetermisdefinedintherulesoftheSEC.

Relevant Education and Experience

TheeducationandexperienceofeachmemberoftheAuditCommitteeissetoutunder"DirectorsandOfficersoftheCompany–Directors"above.

Pre-Approval Policies and Procedures

In2003,theAuditCommitteeestablishedapolicytopre-approveallservicesprovidedbytheCompany'sindependentpublicauditor,Ernst&YoungLLP.TheAuditCommitteedetermineswhichnon-auditservicestheindependentauditorsareprohibitedfromprovidingandauthorizespermittednon-auditservicestobeperformedbytheindependentauditorsto


theextentthoseservicesarepermittedbySOXandotherapplicablelegislationandregulations.AllfeespaidtoErnst&YoungLLPin2015werepre-approvedbytheAuditCommittee.

External Auditor Service Fees

Ernst&YoungLLPhasservedastheCompany'sindependentpublicauditorforeachofthefiscalyearsendedDecember31,2015and2014.FeespaidtoErnst&YoungLLPin2015and2014aresetoutbelow.


2015 2014 (C$ thousands) Auditfees 2,305 2,489

Audit-relatedfees(1) 222 23

Taxfees(2) 308 1,475

Allotherfees(3) 214 752

Total (4) 3,049 4,739

Notes:

(1) AuditrelatedfeesconsistoffeespaidforassuranceandrelatedservicesperformedbytheauditorsthatarereasonablyrelatedtotheperformanceoftheauditoftheCompany'sfinancialstatements.Thisincludesconsultationwithrespecttofinancialreporting,accountingstandardsandcompliancewithSection404ofSOX.

(2) Taxfeeswerepaidforprofessionalservicesrelatingtotaxcompliance,taxadviceandtaxplanning.Theseservicesincludedthereviewoftaxreturnsandtaxplanningandadvisoryservicesinconnectionwithinternationalanddomestictaxationissues.

(3) AllotherfeeswerepaidforservicesotherthantheservicesdescribedaboveandincludefeesforprofessionalservicesrenderedbytheauditorsinconnectionwiththeconversiontoIFRSaswellthetranslationofsecuritiesregulatoryfilingsrequiredtocomplywithsecuritieslawsincertainCanadianjurisdictions.

(4) Nootherfeeswerepaidtoauditorsintheprevioustwoyears.

LEGAL PROCEEDINGS AND REGULATORY ACTIONS OnMarch8,2012andApril10,2012,aNoticeofActionandStatementofClaim(collectively,the"OntarioClaim")wereissuedbyWilliamLeslie,AFALivforsakringsaktiebolagandcertainotherentitiesagainsttheCompanyandcertainofitscurrentandformerofficersanddirectors.OnSeptember27,2012,theplaintiffsissuedaFreshasAmendedStatementofClaim.TheFreshasAmendedStatementofClaimallegedthattheCompany'spublicdisclosureconcerningwaterflowissuesattheGoldexminewasmisleading.TheOntarioClaimwasissuedbytheplaintiffsonbehalfofallpersonsandentitieswhoacquiredsecuritiesoftheCompanyduringtheperiodMarch26,2010toOctober19,2011,excludingpersonsresidentordomiciledintheProvinceofQuebecatthetimetheypurchasedoracquiredsuchsecurities.Theplaintiffssought,amongotherthings,damagesofC$250million.OnApril17,2013anOrderwasgrantedonconsentcertifyingtheactionandgrantingleavefortheclaimsunderSection138oftheSecurities Act (Ontario)toproceed.

OnMarch28,2012,theCompanyandcertainofitscurrentandformerofficers,someofwhomalsoareorweredirectorsoftheCompany,werenamedasrespondentsinaMotionforLeavetoInstituteaClassActionandfortheAppointmentofaRepresentativePlaintiff(the"QuebecMotion").Theactionwasonbehalfofallpersonsandentitieswithfewerthan50employeesresidentinQuebecwhoacquiredsecuritiesoftheCompanybetweenMarch26,2010andOctober19,2011.TheproposedclassactionwasfordamagesofC$100millionarisingasaresultofallegedlymisleadingdisclosurebytheCompanyconcerningitsoperationsattheGoldexmine.OnOctober15,2012,theplaintiffsservedanamendedQuebecMotionseekingleavetocommenceanactionundertheSecurities Act (Quebec)inadditiontoseekingauthorizationtoinstituteaclassaction.OnOctober1,2013,theQuebeccourtcertifiedtheclassactionontermsidenticaltothosesetoutintheconsentOrdergrantedinOntarioonApril17,2013.

InSeptember2015,theCompanyparticipatedinamediationwiththeplaintiffsinrespectofboththeOntarioandQuebecactionsandreachedanagreementinprincipletosettletheOntarioandQuebecactionsforC$17.0millionwithoutanyadmissionofliability.Aspartofthesettlement,theproceedingsagainsttheCompanyandtheindividualdefendantshavebeendismissed.ThesettlementwasapprovedbytheOntarioandQuebeccourtsonFebruary11,2016andFebruary1,2016,respectively.TheamountofthesettlementhasbeencoveredbytheinsurerstotheCompany.


INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS OtherthanasdescribedinthisAIF,sinceJanuary1,2014,nodirector,officeror10%shareholderoftheCompanyoranyassociateoraffiliateofanysuchpersonorshareholder,hasorhadanymaterialinterest,directorindirect,inanytransactionthathasmateriallyaffectedorwillmateriallyaffecttheCompanyoranyofitssubsidiaries.

TRANSFER AGENT AND REGISTRAR TheregistrarandtransferagentfortheCompany'scommonsharesisComputershareTrustCompanyofCanada,Toronto,Ontario.

MATERIAL CONTRACTS TheCompanybelievesthefollowingcontractsconstitutetheonlymaterialcontractstowhichitisaparty.

Credit Facility

OnAugust4,2011,theCompanyamendedandrestateditscreditfacilitywithagroupoffinancialinstitutionsthatprovidesa$1.2billionunsecuredrevolvingbankcreditfacility(the"CreditFacility").TheCreditFacilitywassubsequentlyamendedonJuly20,2012,September8,2014andSeptember30,2015.TheCreditFacilitymaturesandallindebtednessthereunderisdueandpayableonJune22,2020.TheCompany,withtheconsentoflendersrepresentingatleast662/3%oftheaggregatecommitmentsundertheCreditFacility,mayextendthetermoftheCreditFacilityforadditionalone-yearterms.TheCreditFacilityisavailableinmultiplecurrenciesthroughprimerateandbaserateadvances,pricedattheapplicablerateplusamarginthatrangesfrom0.45%to1.75%,dependingontheCompany`screditrating,andthroughLIBORadvances,bankers'acceptancesandlettersofcredit,pricedattheapplicablerateplusamarginthatrangesfrom1.45%to2.75%dependingontheCompany'screditrating.ThelendersundertheCreditFacilityareeachpaidastandbyfeeataratethatrangesfrom0.29%to0.55%oftheundrawnportionofthefacility,dependingontheCompany`screditrating.TheCreditFacilityprovidesforanuncommittedaccordionfeaturewhichpermitstheCompanytorequestanincreaseintheprincipalamountofthefacilitybyupto$300million.NoincreasetotheprincipalamountofthefacilitywilloccurpursuanttotheaccordionfeatureunlessoneormorelendersagreetoincreasetheircommitmentsoranewlenderagreestocommitmentsundertheCreditFacility.PaymentandperformanceoftheCompany'sobligationsundertheCreditFacilityareguaranteedbyeachofitsmaterialsubsidiariesandcertainofitsothersubsidiaries(the"Guarantors"and,togetherwiththeCompany,eachan"Obligor").

TheCreditFacilitycontainscovenantsthatlimit,amongotherthings,theabilityofanObligorto:

• incuradditionalindebtedness;

• payordeclaredividendsormakeotherrestricteddistributionsorpaymentsinrespectoftheCompany'sequitysecuritiesifaneventofdefaulthasoccurredandiscontinuing;

• makesalesorotherdispositionsofmaterialassets;

• createliensonitsexistingorfutureassets,otherthanpermittedliens;

• enterintotransactionswithaffiliatesotherthantheObligors,exceptonacommerciallyreasonablebasisasifitweredealingwithsuchpersonatarm'slength;

• makeanyinvestmentorloanotherthan:investmentsinorloanstobusinessesrelatedtominingorabusinessancillaryorcomplementarytomining;investmentsincashequivalents;orcertaininter-companyinvestmentsorloans;

• enterintoormaintaincertainderivativeinstruments;and

• amalgamateorotherwisetransferitsassets.

TheCompanyisalsorequiredtomaintainatotalnetdebttoEBITDAratiobelowaspecifiedmaximumvalueaswellasaminimumtangiblenetworth.EventsofdefaultundertheCreditFacilityinclude,amongotherthings:

• thefailuretopayprincipalwhendueandpayableorinterest,feesorotheramountspayablewithinfivebusinessdaysofsuchamountsbecomingdueandpayable;


• thebreachbytheCompanyofanyfinancialcovenant;

• thebreachbyanyObligorofanyofitsobligationsorundertakingsundertheCreditFacilityorrelatedagreementsordocumentsthatisnotcuredwithin30daysafterwrittennoticeofthebreachhasbeengiventotheCompany;

• adefaultunderanyotherindebtednessoftheObligorsiftheeffectofsuchdefaultistoaccelerate,ortopermittheaccelerationof,theduedateofsuchindebtednessinanaggregateamountof$50millionormore;

• achangeofcontroloftheCompanywhichisdefinedtooccurupon(a)theacquisition,directlyorindirectly,byanymeanswhatsoever,byanyperson,orgroupofpersonsactingjointlyorinconcert,(collectively,an"offeror")ofbeneficialownershipof,orthepowertoexercisecontrolordirectionover,orsecuritiesconvertibleorexchangeableinto,anysecuritiesoftheCompanycarryinginaggregate(assumingtheexerciseofallsuchconversionorexchangerightsinfavouroftheofferor)morethan50%oftheaggregatevotesrepresentedbythevotingstockthenissuedandoutstandingorotherwiseentitlingtheofferortoelectamajorityoftheboardofdirectorsoftheCompany,or(b)thereplacementbywayofelectionorappointmentatanytimeofone-halformoreofthetotalnumberofthethenincumbentmembersoftheboardofdirectorsoftheCompany,ortheelectionorappointmentofnewdirectorscomprisingone-halformoreofthetotalnumberofmembersoftheboardofdirectorsinofficeimmediatelyfollowingsuchelectionorappointment;unless,inanysuchcase,thenominationofsuchdirectorsforelectionortheirappointmentisapprovedbytheboardofdirectorsoftheCompanyinofficeimmediatelyprecedingsuchnominationorappointmentincircumstanceswheresuchnominationorappointmentismadeotherthanasaresultofadissidentpublicproxysolicitation,whetheractualorthreatened(a"ChangeofControl");and

• variouseventsrelatingtothebankruptcyorinsolvencyorwinding-up,liquidationordissolutionorcessationofbusinessofanyObligor.

AsatMarch15,2016,therewasapproximately$266millionintheaggregatedrawnundertheCreditFacility(includingoutstandinglettersofcredit).

Letter of Credit Facilities

BNS Letter of Credit Facility

OnJune26,2012,theCompanyenteredintoaletterofcreditfacilitywithTheBankofNovaScotia,aslender,providingforaC$150millionuncommittedletterofcreditfacility(the"BNSLetterofCreditFacility").ThroughaseriesofamendmentstotheBNSLetterofCreditFacilityfromNovember5,2013toOctober28,2015,theCompanyandthelenderincreasedthemaximumaggregateamountthatmaybeoutstandingundertheBNSLetterofCreditFacilitytoC$250million.

UnderthetermsoftheBNSLetterofCreditFacility,theCompanymayrequesttobeissuedoneormorelettersofcreditinamaximumaggregateamountoutstandingatanytimenotexceedingC$250million.TheBNSLetterofCreditFacilitymaybeusedbytheCompanytosupport(a)reclamationobligationsoftheCompanyoritssubsidiariesor(b)non-financialorperformanceobligationsoftheCompanyoritssubsidiariesthatarenotdirectlyrelatedtoreclamationobligations.IftheCompanyfailstopayanyamountofareimbursementobligationundertheBNSLetterofCreditFacility,includinganyinterestthereon,onthedatesuchamountisdue,theoverdueamountwillbearinterestatequalto2%greaterthantheprimerate(ascalculatedundertheBNSLetterofCreditFacility).PaymentandperformanceoftheCompany'sobligationsundertheBNSLetterofCreditFacilityareguaranteedbytheGuarantors.

EventsofdefaultundertheBNSLetterofCreditFacilityinclude,amongotherthings:

• thefailuretopayanyamountdrawnundertheBNSLetterofCreditFacilitywithinthreebusinessdaysofwhennotifiedordemandedbythelender;

• thebreachbyanyObligorofanyobligationorundertakingundertheLetterofCreditFacilityorguaranteeprovidedpursuanttotheBNSLetterofCreditFacility;

• adefaultunderanyotherindebtednessoftheObligorsiftheeffectofsuchdefaultistoaccelerate,ortopermittheaccelerationof,theduedateofsuchindebtednessinanaggregateamountof$50millionormore;and

• aChangeofControl.

TheBNSLetterofCreditFacilityprovidesthatuponaneventofdefault,TheBankofNovaScotiamaydeclareimmediatelydueandpayableallamountsdrawnundertheBNSLetterofCreditFacility.

AsatMarch15,2016,therewasapproximatelyC$239millionintheaggregatedrawnundertheBNSLetterofCreditFacility.


TD Letter of Credit Facility

OnSeptember23,2015,theCompanyenteredintoastandbyletterofcreditfacilitywithTheToronto-DominionBank,aslender,providingforaC$150millionuncommittedletterofcreditfacility(asamended,the"TDLetterofCreditFacility").

UnderthetermsoftheTDLetterofCreditFacility,theCompanymayrequesttobeissuedoneormorelettersofcreditinamaximumaggregateamountoutstandingatanytimenotexceedingC$150million.TheTDLetterofCreditFacilitymaybeusedbytheCompanytosupport(a)thereclamationobligationsoftheCompany,itssubsidiariesoranyentityinwhichtheCompanyhasadirectorindirectinterestor(b)theperformanceobligations(otherthanwithrespecttoindebtednessforborrowedmoney)oftheCompany,itssubsidiariesoranyentityinwhichtheCompanyhasadirectorindirectinterestthatarenotdirectlyrelatedtoreclamationobligations.

PaymentandperformanceoftheCompany'sobligationsundertheTDLetterofCreditFacilityaresupportedbyanaccountperformancesecurityguaranteeissuedbyExportDevelopmentCanada("EDC")infavourofthelender.EDCissuedtheguaranteeinconnectionwithadeclarationandindemnitydatedSeptember23,2015betweenEDCandtheObligors(assupplemented,the"EDCIndemnity").PursuanttotheEDCIndemnity,eachoftheObligorshasagreedtoindemnifyEDCagainstallclaimsanddemandsmadeinrespectofanyindemnitybondingproductissuedbyEDCpursuanttotheEDCIndemnity.

AsatMarch15,2016,therewasapproximatelyC$97millionintheaggregatedrawnundertheTDLetterofCreditFacility.

Note Purchase Agreements

OnApril7,2010,theCompanyenteredintoanotepurchaseagreementwithcertaininstitutionalinvestors,providingfortheissuanceofnotesconsistingof$115million6.13%SeriesAseniornotesdue2017,$360million6.67%SeriesBseniornotesdue2020and$125million6.77%SeriesCseniornotesdue2022(the"2010NotePurchaseAgreement").OnJuly24,2012,theCompanyenteredintoanothernotepurchaseagreementwithcertaininstitutionalinvestors,providingfortheissuanceofnotesconsistingof$100million4.87%SeriesAseniornotesdue2022and$100million5.02%SeriesBseniornotesdue2024(the"2012NotePurchaseAgreement").OnSeptember30,2015,theCompanyenteredintothe2015NotePurchaseAgreement,providingfortheissuanceof$50million4.15%seniornotesdue2025(togetherwiththe2010NotePurchaseAgreementandthe2012NotePurchaseAgreement,the"NotePurchaseAgreements").

PaymentandperformanceoftheCompany'sobligationsundertheNotePurchaseAgreements,thenotesissuedpursuanttheretoandtheobligationsoftheGuarantorsundertheguaranteesareguaranteedbytheGuarantors.

TheNotePurchaseAgreementscontainrestrictivecovenantsthatlimit,amongotherthings,theabilityofanObligorto:

• enterintotransactionswithaffiliatesotherthantheObligors,exceptonacommerciallyreasonablebasisupontermsnolessfavourabletotheObligorthanwouldbeobtainableinacomparablearm'slengthtransaction;

• amalgamateorotherwisetransferitsassets;

• carryonbusinessotherthanthoserelatedtominingorabusinessancillaryorcomplementarytomining;

• engageinanydealingsortransactionswithanypersonorentityidentifiedundercertainanti-terrorismregulations;

• createliensonitsexistingorfutureassets,otherthanpermittedliens;

• incursubsidiaryindebtednesswheretheObligorisasubsidiaryoftheCompany;and

• makesalesorotherdispositionsofmaterialassets.

TheCompanyisalsorequiredtomaintainthesamefinancialratiosandthesameminimumtangiblenetworthundertheNotePurchaseAgreementsasundertheCreditFacility.EventsofdefaultundertheNotePurchaseAgreementsinclude,amongotherthings:

• thefailuretopayprincipalormakewholeamountswhendueandpayableorinterest,feesorotheramountspayablewithinfivebusinessdaysofsuchamountsbecomingdueandpayable;

• thebreachbyanyObligorofanyothertermorcovenantthatisnotcuredwithin30businessdaysaftertheearlierofwrittennoticeofthebreachhavingbeengiventotheCompanyoractualknowledgeofthebreachisobtained;

• thefindingthatanyrepresentationorwarrantymadebyanObligorwasfalseorincorrectinanymaterialrespectonthedateasofwhichitwasmade;


• adefaultunderanyotherindebtednessoftheObligorsiftheeffectofsuchdefaultistoaccelerate,ortopermittheaccelerationof,theduedateofsuchindebtednessinanaggregateamountof$50millionormore;and

• variouseventsrelatingtothebankruptcyorinsolvencyorwinding-up,liquidationordissolutionorcessationofbusinessofanyObligor.

TheNotePurchaseAgreementsprovidethat,uponcertaineventsofdefault,thenotesautomaticallybecomedueandpayablewithoutanyfurtheraction.Inaddition,theNotePurchaseAgreementscontaina"MostFavoredLender"clausewhichactstoincorporateintotheNotePurchaseAgreementsanygraceperiodsuponaneventofdefaultthatareshorterintheCreditFacilitythanintheNotePurchaseAgreements.

INTERESTS OF EXPERTS Ernst&YoungLLP,theauditorsoftheCompany,hasadvisedtheCompanythatitisindependentoftheCompanyinaccordancewiththeRulesofProfessionalConductoftheInstituteofCharteredAccountantsofOntarioandhascompliedwiththeSEC'srulesonauditorindependence.

ADDITIONAL INFORMATION AdditionalinformationrelatingtotheCompanycanbefoundonSEDARatwww.sedar.com ,ontheSEC'swebsiteatwww.sec.gov andontheCompany'swebsiteatwww.agnicoeagle.com .Additionalinformation,includingdirectors'andofficers'remunerationandindebtedness,principalholdersoftheCompany'ssecuritiesandsecuritiesauthorizedforissuanceunderequitycompensationplans,iscontainedintheCompany'smanagementinformationcirculardatedMarch11,2016relatingtotheannualandspecialmeetingofshareholdersoftheCompanyscheduledforApril29,2016.AdditionalfinancialinformationisprovidedintheAnnualFinancialStatementsandAnnualMD&A.


SCHEDULE "A" AUDIT COMMITTEE CHARTER OF THE COMPANY

ThisChartershallgoverntheactivitiesoftheauditcommittee(the"AuditCommittee")oftheboardofdirectors(the"BoardofDirectors")ofAgnicoEagleMinesLimited(the"Corporation").

I. PURPOSE OF THE AUDIT COMMITTEE

TheAuditCommitteeshall:(a)assisttheBoardofDirectorsinitsoversightresponsibilitieswithrespectto:(i)theintegrityoftheCorporation'sandit'ssubsidiaries'financialstatements,(ii)theCorporation'scompliancewithlegalandregulatoryrequirements,(iii)theexternalauditor'squalificationsandindependence,and(iv)theperformanceoftheCorporation'sinternalandexternalauditfunctions;and(b)prepareanyreportoftheAuditCommitteerequiredtobeincludedintheCorporation'sannualreportorproxymaterial.TheheadoftheCorporation'sinternalauditfunctionandtheexternalauditorsshallhavedirectandreadyaccesstothechairoftheAuditCommittee(the"Chair").

TheAuditCommitteeshallhavetheauthoritytodelegatetooneormoreofitsmembers,responsibilityfordevelopingrecommendationsforconsiderationbytheAuditCommitteewithrespecttoanyofthemattersreferredtointhisCharter.

II. COMPOSITION

TheAuditCommitteeshallbecomprisedofaminimumofthreedirectors.NomemberoftheAuditCommitteeshallbeanofficeroremployeeoftheCorporationoranyofitsaffiliatesforthepurposesoftheapplicablecorporatestatute.EachmemberoftheAuditCommitteeshallbeanunrelatedandindependentdirectorasdeterminedbytheBoardofDirectorsinaccordancewiththeapplicablerequirementsofthelawsgoverningtheCorporation,theapplicablestockexchangesonwhichtheCorporation'ssecuritiesarelistedandapplicablesecuritiesregulatoryauthorities.(SeeScheduleAforrequirements.)

EachmemberoftheAuditCommitteeshallbefinanciallyliterate.UnlesstheAuditCommitteeshallotherwisedetermine,amemberoftheAuditCommitteeshallbeconsideredtobefinanciallyliterateifheorshehastheabilitytoreadandunderstandasetoffinancialstatementsthatpresentabreadthandlevelofcomplexityofaccountingissuesthataregenerallycomparabletothebreadthandcomplexityoftheissuesthatcanreasonablybeexpectedtoberaisedbytheCorporation'sfinancialstatements.

AtleastonememberoftheAuditCommitteeshallbeafinancialexpert.(SeeScheduleBfordefinition.)

ThemembersoftheAuditCommitteeshallbeappointedbytheBoardofDirectorsannuallyatthefirstmeetingoftheBoardofDirectorsafterameetingoftheshareholdersatwhichdirectorsareelectedandshallserveuntil:thenextannualmeetingoftheshareholders;theyresign;theirsuccessorsaredulyappointed;orsuchmemberisremovedfromtheAuditCommitteebytheBoardofDirectors.TheBoardofDirectorsshalldesignateonememberoftheAuditCommitteeastheChairor,ifitfailstodoso,themembersoftheAuditCommitteeshallappointtheChairfromamongitsmembers.

NomemberoftheAuditCommitteemayearnfeesfromtheCorporationoranyofitssubsidiariesotherthandirectorsfees(whichfeesmayincludecash,shares,restrictedshareunitsand/orotherin-kindconsiderationordinarilyavailabletodirectors,aswellasalloftheregularbenefitsthatotherdirectorsreceive).Forgreatercertainty,nomemberoftheAuditCommitteeshallacceptanyconsulting,advisoryorothercompensatoryfeefromtheCorporation.

III. MEETINGS

TheAuditCommitteeshallmeetatleastquarterlyormorefrequentlyasrequired.

AsapartofeachmeetingoftheAuditCommitteeatwhichtheAuditCommitteerecommendsthattheBoardofDirectorsapprovetheannualauditedfinancialstatementsoratwhichtheAuditCommitteereviewsthequarterlyfinancialstatements,theAuditCommitteeshallmeetinaseparatesessionwiththeexternalauditorand,ifdesired,withmanagementand/ortheinternalauditor.Inaddition,theAuditCommitteeortheChairshallmeetwithmanagementquarterlytoreviewtheCorporation'sfinancialstatementsasdescribedinSectionIV.5belowandtheAuditCommitteeoradesignatedmemberoftheAuditCommitteeshallmeetwiththeexternalauditorstoreviewtheCorporation'sfinancialstatementsonaquarterlyorotherregularbasisastheAuditCommitteemaydeemappropriate.

TheAuditCommitteeshallseektoactonthebasisofconsensus,butanaffirmativevoteofamajorityofmembersoftheAuditCommitteeparticipatinginanymeetingoftheAuditCommitteeshallbesufficientfortheadoptionofanyresolution.

AGNICO EAGLE A-1 ANNUAL INFORMATION FORM

IV. RESPONSIBILITIES AND DUTIES

TheAuditCommittee'sprimaryresponsibilitiesareto:

General

1. reviewandassesstheadequacyofthisCharteratleastannuallyand,wherenecessaryordesirable,recommendchangestotheBoardofDirectors;

2. reporttotheBoardofDirectorsregularlyatsuchtimesastheChairmaydeterminetobeappropriatebutnotlessfrequentlythanfourtimesperyear;

3. followtheprocessestablishedforallcommitteesoftheBoardofDirectorsforassessingtheAuditCommittee'sperformance;

Documents/ReportsReview

4. reviewtheCorporation'sfinancialstatementsandrelatedmanagement'sdiscussionandanalysis,AnnualInformationForm("AIF")andrelatedForm40-F,AnnualReportandanyotherannualreportsorotherfinancialinformationtobesubmittedtoanygovernmentalbodyorthepublic,includinganycertification,report,opinionorreviewrenderedbytheexternalauditorsbeforetheyareapprovedbytheBoardofDirectorsandpubliclydisclosed;

5. reviewwiththeCorporation'smanagementandtheexternalauditors,theCorporation'squarterlyfinancialstatementsandrelatedmanagement'sdiscussionandanalysis,beforetheyarereleased;

6. ensurethatadequateproceduresareinplaceforthereviewoftheCorporation'sdisclosureoffinancialinformationextractedorderivedfromtheCorporation'sfinancialstatementsotherthanthedisclosurereferredtointhetwoimmediatelyprecedingparagraphsandperiodicallyassesstheadequacyofsuchprocedures;

7. reviewtheeffectsofregulatoryandaccountinginitiatives,aswellasoff-balancesheetstructures,onthefinancialstatementsoftheCorporation;

8. reviewwiththeCorporation'smanagementanypressreleaseoftheCorporationwhichcontainsfinancialinformation(payingparticularattentiontotheuseofany"proforma"or"adjusted"non-GAAPinformation);

9. reviewandassess,onaquarterlybasis,management'sriskassessmentandriskmanagementstrategiesincludinghedgingandderivativestrategies;

ExternalAuditors

10. recommendexternalauditorsnominationstotheBoardofDirectorstobeputbeforetheshareholdersforappointmentand,asnecessary,theremovalofanyexternalauditorinofficefromtimetotime;

11. approvethefeesandothercompensationtobepaidtotheexternalauditors;

12. pre-approveallsignificantnon-auditengagementstobeprovidedtotheCorporationwiththeexternalauditors;

13. requiretheexternalauditorstosubmittotheAuditCommittee,onaregularbasis(atleastannually),aformalwrittenstatementdelineatingallrelationshipsbetweentheexternalauditorsandtheCorporationanddiscusswiththeexternalauditorsanyrelationshipsthatmightaffecttheexternalauditors'objectivityandindependence;

14. recommendtotheBoardofDirectorsanyactionrequiredtoensuretheindependenceoftheexternalauditors;

15. advisetheexternalauditorsoftheirultimateaccountabilitytotheBoardofDirectorsandtheAuditCommittee;

16. overseetheworkoftheexternalauditorsengagedforthepurposeofpreparinganauditreportorperformingotheraudit,reviewandattestationservicesfortheCorporation;

17. evaluatethequalifications,performanceandindependenceoftheexternalauditorswhicharetoreportdirectlytotheAuditCommittee,including(i)reviewingandevaluatingtheleadpartnerontheexternalauditors'engagementwiththeCorporation,(ii)consideringwhethertheexternalauditors'qualitycontrolsareadequateandtheprovisionofpermittednon-auditservicesiscompatiblewithmaintainingtheexternalauditors'independence,(iii)determinetherotationoftheleadexternalauditpartnerandtheexternalauditfirm,and

A-2 AGNICO EAGLE ANNUAL INFORMATION FORM

(iv)takeintoaccounttheopinionsofmanagementandtheinternalauditfunctioninassessingtheexternalauditors'qualifications,independenceandperformance;

18. presenttheAuditCommittee'sconclusionswithrespecttoitsevaluationofexternalauditorstotheBoardofDirectorsandtakesuchadditionalactiontosatisfyitselfofthequalifications,performanceandindependenceofexternalauditorsandmakefurtherrecommendationstotheBoardofDirectorsasitconsidersnecessary;

19. obtainandreviewareportfromtheexternalauditorsatleastannuallyregarding:theexternalauditors'internalquality-controlprocedures;materialissuesraisedbythemostrecentinternalquality-controlreview,orpeerreview,ofthefirm,orbyanyinquiryorinvestigationbygovernmentalorprofessionalauthoritieswithintheprecedingfiveyearsrespectingoneormoreexternalauditscarriedoutbythefirm;anystepstakentodealwithanysuchissues;andallrelationshipsbetweentheexternalauditorsandtheCorporation;

20. establishpoliciesfortheCorporation'shiringofemployeesorformeremployeesoftheexternalauditors;

InternalAuditor

21. receiveregularquarterlyreportsfromtheCorporation'sinternalauditoronthescopeandmaterialresultsofitsinternalauditactivities,basedontheInternalAuditCharter;

22. reviewanddiscusstheCorporation'sCodeofBusinessConductandEthicsandfraudpolicyandtheactionstakentomonitorandenforcecompliancewiththeCorporation'sCodeofBusinessConductandEthicsandfraudpolicy;

23. establishproceduresfor:

i) thereceipt,retentionandtreatmentofcomplaintsregardingaccounting,internalcontrolsorauditingmatters;

ii) theconfidential,anonymoussubmissionofconcernsregardingquestionableaccounting,internalcontrolandauditingmatters;and

iii) compliancewithapplicableforeigncorruptpracticeslegislation,guidelinesandpractices.

FraudPreventionandDetection

24. overseeandassessmanagement'scontrolsandprocessestopreventanddetectfraud;

25. receiveperiodicreportsfromtheinternalauditoronfindingsoffraudaswellassignificantfindingsregardingthedesignand/oroperationofinternalcontrolsandmanagementresponses;

FinancialReportingProcess

26. periodicallydiscusstheintegrity,completenessandaccuracyoftheCorporation'sinternalcontrolsandthefinancialstatementswiththeexternalauditorsintheabsenceoftheCorporation'smanagement;

27. inconsultationwiththeexternalauditors,reviewtheintegrityoftheCorporation'sfinancialinternalandexternalreportingprocesses;

28. considertheexternalauditors'assessmentoftheappropriatenessoftheCorporation'sauditingandaccountingprinciplesasappliedinitsfinancialreporting;

29. reviewanddiscusswithmanagementandtheexternalauditorsatleastannuallyandapprove,ifappropriate,anymaterialchangestotheCorporation'sauditingandaccountingprinciplesandpracticessuggestedbytheexternalauditors,internalauditpersonnelormanagement;

30. reviewanddiscusswiththeChiefExecutiveOfficer("CEO")andtheChiefFinancialOfficer("CFO")theproceduresundertakeninconnectionwiththeCEOandCFOcertificationsfortheinterimandannualfilingswithapplicablesecuritiesregulatoryauthorities;

31. reviewdisclosuresmadebytheCEOandCFOduringtheircertificationprocessfortheannualandinterimfilingswithapplicablesecuritiesregulatoryauthoritiesaboutanysignificantdeficienciesinthedesignoroperationof


internalcontrolswhichcouldadverselyaffecttheCorporation'sabilitytorecord,process,summarizeandreportfinancialdataoranymaterialweaknessesintheinternalcontrols,andanyfraudinvolvingmanagementorotheremployeeswhohaveasignificantroleintheCorporation'sinternalcontrols;

32. establishregularandseparatesystemsofreportingtotheAuditCommitteebymanagementandtheexternalauditorsofanysignificantdecisionmadeinmanagement'spreparationofthefinancialstatements,includingthereportingoftheviewofmanagementandtheexternalauditorsastotheappropriatenessofsuchdecisions;

33. discussduringtheannualaudit,andreviewseparatelywitheachofmanagementandtheexternalauditors,anysignificantmattersarisingfromthecourseofanyaudit,includinganyrestrictionsonthescopeofworkoraccesstorequiredinformation;whetherraisedbymanagement,theheadofinternalauditortheexternalauditors;

34. resolveanydisagreementsbetweenmanagementandtheexternalauditorsregardingfinancialreporting;

35. reviewwiththeexternalauditorsandmanagementtheextenttowhichchangesorimprovementsinfinancialoraccountingpractices,asapprovedbytheAuditCommittee,havebeenimplementedatanappropriatetimesubsequenttotheimplementationofsuchchangesorimprovements;

36. retainanddeterminethecompensationofanyindependentcounsel,accountantsorotheradvisorstoassistinitsoversightresponsibilities(theAuditCommitteeshallnotberequiredtoobtaintheapprovaloftheBoardofDirectorsforsuchpurposes);

37. discussanymanagementorinternalcontrollettersorproposalstobeissuedbytheexternalauditorsoftheCorporation;

DisclosureControlsandProcedures

38. obtainandreviewthestatementofCorporateDisclosureControls,ProceduresandPoliciespreparedbythedisclosurecommitteeoftheBoardofDirectorsand,ifappropriate,approvethedisclosurecontrolsandproceduressetoutinsuchstatementandanychangesmadethereto;

39. receiveconfirmationfromtheCEOandCFOthatreportstobefiledwithCanadiansecuritiesregulatoryauthorities,theheUnitedStatesSecuritiesandExchangeCommissionandanyotherapplicableregulatoryagency:

(a) havebeenpreparedinaccordancewiththeCorporation'sdisclosurecontrolsandprocedures;and

(b) containnomaterialmisrepresentationsoromissionsandfairlypresents,inallmaterialrespects,thefinancialcondition,resultsofoperationsandcashflowasofandfortheperiodcoveredbysuchreports;

40. receiveconfirmationfromtheCEOandCFOthattheyhaveconcludedthatthedisclosurecontrolsandproceduresareeffectiveasoftheendoftheperiodcoveredbythereports;

41. discusswiththeCEOandCFOanyreasonsforwhichanyoftheconfirmationsreferredtointhetwoprecedingparagraphscannotbegivenbytheCEOandCFO;

LegalCompliance

42. confirmthattheCorporation'smanagementhastheproperreviewsysteminplacetoensurethattheCorporation'sfinancialstatements,reports,pressreleasesandotherfinancialinformationsatisfylegalrequirements;

43. reviewlegalcompliancematterswiththeCorporation'slegalcounsel;

44. reviewwiththeCorporation'slegalcounselanylegalmatterthattheAuditCommitteeunderstandscouldhaveasignificantimpactontheCorporation'sfinancialstatements;

45. conductorauthorizeinvestigationsintomatterswithintheAuditCommittee'sscopeofresponsibilities;

46. performanyotheractivitiesinaccordancewiththisCharter,theCorporation'sby-lawsandgoverninglawthattheAuditCommitteeortheBoardofDirectorsdeemsnecessaryorappropriate;


RelatedPartyTransactions

47. reviewthefinancialreportingofanytransactionbetweentheCorporationandanyofficer,directororother"relatedparty"asdefinedwithintheCorporation'sAccountingPolicy(includinganyshareholderholdinganinterestgreaterthan5%intheCorporation)oranyentityinwhichanysuchpersonhasafinancialinterest;

ReportingandPowers

48. reporttotheBoardofDirectorsfollowingeachmeetingoftheAuditCommitteeandatsuchothertimesastheBoardofDirectorsmayconsiderappropriate;and

49. exercisesuchotherpowersandperformsuchotherdutiesandresponsibilitiesasareincidentaltothepurposes,dutiesandresponsibilitiesspecifiedhereinandasmayfromtimetotimebedelegatedtotheAuditCommitteebytheBoardofDirectors.

V. LIMITATION OF RESPONSIBILITY

WhiletheAuditCommitteehastheresponsibilitiesandpowersprovidedbythisCharter,itisnotthedutyoftheAuditCommitteetoplanorconductauditsortodeterminethattheCorporation'sfinancialstatementsarecompleteandaccurateandareinaccordancewithinternationalfinancialreportingstandards.Thisistheresponsibilityofmanagement(withrespecttowhomtheAuditCommitteeperformsanoversightfunction)andtheexternalauditors.


SCHEDULE A TO THE AUDIT COMMITTEE CHARTER OF THE CORPORATION

UnrelatedDirector

UndertheTorontoStockExchangerules,"independentdirector"meansadirectorwho:

(a) isnotamemberofmanagementandisfreefromanyinterestandanybusinessorotherrelationshipwhichintheopinionoftheExchangecouldreasonablybeperceivedtomateriallyinterferewiththedirector'sabilitytoactinthebestinterestofthecompany;and

(b) isabeneficialholder,directlyorindirectly,orisanomineeorassociateofabeneficialholder,collectivelyof10%orlessofthevotesattachingtoallissuedandoutstandingsecuritiesoftheapplicant.

TheExchangewillconsiderallrelevantfactorsinassessingtheindependenceofthedirector.Asageneralrule,thefollowingpersonswouldnotbeconsideredanindependentdirector:

i) apersonwhoiscurrently,orhasbeenwithinthepastthreeyears,anofficer,employeeoforserviceprovidertothecompanyoranyofitssubsidiariesoraffiliates;or

ii) apersonwhoisanofficer,employeeorcontrollingshareholderofacompanythathasamaterialbusinessrelationshipwiththeapplicant.

IndependentDirector

NationalInstrument–52-110

Adirectoris"independent"ifheorshehasnodirectorindirectmaterialrelationshipwiththeissuer.ThefollowingsummarizesthemajoraspectsofNationalInstrument52-110–Audit Committees ("NI52-110")relatingtotheindependenceofadirector.

Certain Relationships Automatically Exclude a Director From Serving on the Audit Committee

Ifadirector(oramemberofthedirector'simmediatefamily)hasaspecifiedtypeofrelationshipwiththeissuer(whichincludestheissuer'sparentandsubsidiaryentities),thenthatdirectorwillnotbeconsideredindependent.NI52-110assumesthatthefollowingpersonshaveamaterialrelationshipwiththeissuer(andarethereforeprecludedfromsittingontheauditcommittee):

Employment Relationships

• anindividualwhois,orhasbeenwithinthelastthreeyears,employeeorexecutiveofficeroftheissueroranindividualwhoseimmediatefamilymemberis,orhasbeenwithinthelastthreeyears,anexecutiveofficeroftheissuer;

• anindividualwho,orwhoseimmediatefamilymember,is,orhasbeenwithinthelastthreeyears,anexecutiveofficerofanotherentityifanyoftheissuer'scurrentexecutiveofficersservesorservedatthatsametimeonthecompensationcommitteeofthatentity;

• anindividualwhoreceived,orwhoseimmediatefamilymemberwhoisemployedasanexecutiveofficeroftheissuerwhoreceived,morethanC$75,000indirectcompensationfromtheissuerduringany12monthperiodwithinthelastthreeyears(otherthanremunerationforactingasamemberoftheboardofdirectorsoranyboardcommitteeoftheissuerandfixedamountsreceivedunderaretirementplanforpriorservicewiththeissuerthatisnotcontingentoncontinuedservice);

Relationships with Internal or External Auditors

• anindividualwhoisapartneroremployeeoftheissuer'sinternalorexternalauditororanindividualwhowaswithinthelastthreeyearsapartneroremployeeoftheissuer'sinternalorexternalauditorandpersonallyworkedontheissuer'sauditwithinthattime;

• anindividualwhosespouse,minorchildorstepchild,orchildorstepchildwhosharesahomewiththeindividual,is(i)apartneroftheissuer'sinternalorexternalauditor,(ii)anemployeeoftheissuer'sinternalorexternalauditorandparticipatesinitsaudit,assuranceortaxcompliance(butnottaxplanning)practice,(iii)oranindividualwho


waswithinthelastthreeyearsapartneroremployeeoftheissuer'sinternalorexternalauditorandpersonallyworkedontheissuer'sauditwithinthattime;

Advisory or Consulting Relationships

• anindividualwhoaccepts,directlyorindirectly,anyconsulting,advisoryorothercompensatoryfeefromtheissueroranysubsidiaryentityoftheissuer,otherthanremunerationforactingasamemberoftheboardoranyboardcommitteeorasapart-timechairorvice-chairoftheboardoranyboardcommittee,includingtheindirectacceptanceofafeebyanindividual'sspouse,minorchildorstepchild,orchildorstepchildwhosharestheindividual'shomeorbyanentityinwhichsuchindividualisapartner,member,officersuchasamanagingdirectororexecutiveofficerandwhichprovidesaccounting,consulting,legal,investmentbankingorfinancialadvisoryservicestotheissueroranysubsidiaryentityoftheissuer;and

Relationships with Affiliated Entities

• anindividualwhoisanaffiliatedentityoftheissueroranyofitssubsidiaryentities,whereaffiliatedentitymeansapersonthathasthedirectorindirectpowertodirectorcausethedirectionofmanagementandthepoliciesoftheissueroranyofitssubsidiaryentities,whetherthroughownershipofvotingsecuritiesorotherwise(otherthananindividualwhoowns,directlyorindirectly,tenpercentoflessofanyclassofvotingsecuritiesoftheissuerandisnotanexecutiveofficeroftheissuer)oranindividualwhoisbothadirectorandanemployeeofanaffiliatedentityoranexecutiveofficer,generalpartnerormanagingmemberofanaffiliatedentity.

The Materiality of Other Relationships is for the Board to Determine

Ifadirectorhasadirectorindirectrelationshipwiththeissuer,thenitwillbematerialif,intheviewoftheissuer'sboardofdirectors,therelationshipcouldreasonablyinterferewiththeexerciseofthedirector'sindependentjudgement.Theserelationshipsmayincludecommercial,charitable,industrial,banking,consulting,legal,accountingorfamilialrelationshipsoranyotherrelationshipthattheboardconsiderstobematerial.

Exceptions to the Independence Requirement

NI52-110providesexemptionsfromtheindependencerequirementsfor:

• auditcommitteememberswhoceasetobeindependentforreasonsoutsidetheircontrol(butonlyforalimitedperiodoftime);

• directorsappointedtotheauditcommitteetofillavacancyresultingfromthedeath,disabilityorresignationofamemberoftheauditcommittee(butonlyforalimitedperiodoftime).Thedirectorappointedtofillthevacancyisalsotemporarilyexemptfromthefinancialliteracyrequirements;

• auditcommitteemembers,underexceptionalandlimitedcircumstancesasdeterminedbytheboardinitsreasonablyjudgment,whoarenotconsultantsoradvisors,notanaffiliatedentityoftheissueroranyofitssubsidiaryentities,notanemployeeorofficeroftheissueroranimmediatefamilymemberofsuchanddonotactaschairoftheauditcommittee(butonlyforamaximumperiodoftwoyears);and

• U.S.listedissuerscomplyingwiththeauditcommitteerequirementsoftheirU.S.exchangeorquotationsystem(providedtheymakethenecessarydisclosureintheirAIF(AnnualInformationForm).

NewYorkStockExchangeRules

UndertheNewYorkStockExchangerules,thefollowingrequirementsmustbemettoqualifyasan"IndependentDirector":

(a) nodirectorqualifiesas"independent"unlesstheboardofdirectorsaffirmativelydeterminesthatthedirectorhasnomaterialrelationshipwiththelistedcompany(eitherdirectlyorasapartner,shareholderorofficerofanorganizationthathasarelationshipwiththecompany).Companiesmustdisclosethesedeterminations.

(b) inaddition,thefollowingpersonsarenotindependent:

• anydirectorwhois(orwhohasanimmediatefamilymemberwhois)anexecutiveofficer,otherthanonaninterimbasis,ofthelistedcompany;


• anydirectorwhoreceives(orwhohasanimmediatefamilymemberwhoreceives)morethan$120,000peryearindirectcompensationfromthelistedcompany;

• anydirectorwhois(orwhohasanimmediatefamilymemberwhois,inaprofessionalcapacity)apartneroremployeeofthelistedcompany'sinternalorexternalauditor;

• anydirectorwhois(orwhohasanimmediatefamilymemberwhois)employedasanexecutiveofficerofanothercompanywhereanyoftheexecutivesofthelistedcompanyalsoservesorservedonthatothercompany'scompensationcommittee;and

• anydirectorwhoisanemployee(orwhohasanimmediatefamilymemberwhoisanexecutiveofficer)ofanothercompanythathasmadepaymentsto,orreceivedpaymentsfrom,thelistedcompanyforpropertyorserviceswhichexceedsthegreaterof$1millionor2%ofsuchothercompany'sconsolidatedgrossrevenues.

Three Year "Cooling Off" Period. Foreachofthecategoriesabovewhereadirectorisnot(orispresumednottobe)independent,thereisathree-year"coolingoff"period.Accordingly,theexistenceoftheprohibitedrelationshipatanytimeduringtheprecedingthreeyearsispresumedtoimpairindependence.

Sarbanes-OxleyAct

(a) In General .Eachmemberoftheauditcommitteeoftheissuershallbeamemberoftheboardofdirectorsoftheissuer,andshallotherwisebeindependent.

(b) Criteria .Inordertobeconsideredtobeindependentforpurposesofthisparagraph,amemberofanauditcommitteeofanissuermaynot,otherthaninhisorhercapacityasamemberoftheauditcommittee,theboardofdirectorsoranyotherboardcommittee:

• acceptanyconsulting,advisoryorothercompensatoryfeefromtheissuer;or

• beanaffiliatedpersonoftheissueroranysubsidiarythereof.

Exemption Authority. TheCommissionmayexemptfromtherequirementsofsubparagraph(b)aparticularrelationshipwithrespecttoauditcommitteemembers,astheCommissiondeterminesappropriateinlightofthecircumstances.


SCHEDULE B TO THE AUDIT COMMITTEE CHARTER OF THE CORPORATION

AuditCommitteeFinancialExpert

An"auditcommitteefinancialexpert"mustpossessallofthefollowingattributes:

(a) anunderstandingofgenerallyacceptedaccountingprinciplesandfinancialstatements;

(b) theabilitytoassessthegeneralapplicationofsuchprinciplesinconnectionwiththeaccountingforestimates,accruals,andreserves;

(c) experiencepreparing,auditing,analyzingorevaluatingfinancialstatementsthatpresentabreadthandlevelofcomplexityofaccountingissuesthataregenerallycomparabletothebreathandcomplexityofissuesthatcanreasonablybeexpectedtoberaisedbytheissuer'sfinancialstatements,orexperienceactivelysupervisingoneormorepersonsengagedinsuchactivities;

(d) anunderstandingofinternalcontroloverandproceduresforfinancialreporting;and

(e) anunderstandingofauditcommitteefunctions.

Theauditcommitteefinancialexpertmustalsohaveacquiredthoseattributesthrough:

(a) educationandexperienceasaprincipalfinancialofficer,principalaccountingofficer,controller,publicaccountant,auditororexperienceinoneormorepositionsthatinvolvetheperformanceofsimilarfunctions;

(b) experienceactivelysupervisingaprincipalfinancialofficer,principalaccountingofficer,controller,publicaccountantorauditororpersonperformingsimilarfunctions;

(c) experienceoverseeingorassessingtheperformanceofcompaniesorpublicaccountantsforthepreparation,auditingorevaluationoffinancialstatements;or

(d) otherrelevantexperience.

"Activesupervision"meansthesupervisorparticipatedin,andcontributedto,theprocessofaddressingthesametypesofissuesrelatingtothepreparation,auditing,analysisandevaluationoffinancialstatementsasthepersonactuallyperformingthework.

AGNICO EAGLE B-1 ANNUAL INFORMATION FORM

QuickLinks

Exhibit99.1

AGNICOEAGLEMINESLIMITEDANNUALINFORMATIONFORMINTRODUCTORYNOTESNotetoInvestorsConcerningEstimatesofMineralReservesandMineralResourcesNotetoInvestorsConcerningCertainMeasuresofPerformanceSELECTEDFINANCIALDATAGLOSSARYOFSELECTEDMININGTERMSCORPORATESTRUCTUREDESCRIPTIONOFTHEBUSINESSGENERALDEVELOPMENTOFTHEBUSINESSOPERATIONSANDPRODUCTIONRISKFACTORSDIVIDENDSDESCRIPTIONOFCAPITALSTRUCTURERATINGSMARKETFORSECURITIESDIRECTORSANDOFFICERSOFTHECOMPANYAUDITCOMMITTEELEGALPROCEEDINGSANDREGULATORYACTIONSINTERESTOFMANAGEMENTANDOTHERSINMATERIALTRANSACTIONSTRANSFERAGENTANDREGISTRARMATERIALCONTRACTSINTERESTSOFEXPERTSADDITIONALINFORMATIONSCHEDULE"A"AUDITCOMMITTEECHARTEROFTHECOMPANYSCHEDULEATOTHEAUDITCOMMITTEECHARTEROFTHECORPORATIONSCHEDULEBTOTHEAUDITCOMMITTEECHARTEROFTHECORPORATION


Exhibit 99.2

Annual Audited Consolidated Financial Statements(PREPAREDINACCORDANCEWITHINTERNATIONALFINANCIALREPORTINGSTANDARDS)

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM ON INTERNAL CONTROL OVER FINANCIAL REPORTING TotheBoardofDirectors(the"Board")andShareholdersofAgnicoEagleMinesLimited:

WehaveauditedAgnicoEagleMinesLimited'sinternalcontroloverfinancialreportingasofDecember31,2015,basedoncriteriaestablishedinInternal Control – Integrated Framework issuedbytheCommitteeofSponsoringOrganizationsoftheTreadwayCommissionin2013(the"COSOcriteria").AgnicoEagleMinesLimited'smanagementisresponsibleformaintainingeffectiveinternalcontroloverfinancialreporting,andforitsassessmentoftheeffectivenessofinternalcontroloverfinancialreportingincludedintheaccompanyingmanagementcertificationreportoninternalcontroloverfinancialreporting.OurresponsibilityistoexpressanopiniononAgnicoEagleMinesLimited'sinternalcontroloverfinancialreportingbasedonouraudit.

WeconductedourauditinaccordancewiththestandardsofthePublicCompanyAccountingOversightBoard(UnitedStates).Thosestandardsrequirethatweplanandperformtheaudittoobtainreasonableassuranceaboutwhethereffectiveinternalcontroloverfinancialreportingwasmaintainedinallmaterialrespects.Ourauditincludedobtaininganunderstandingofinternalcontroloverfinancialreporting,assessingtheriskthatamaterialweaknessexists,testingandevaluatingthedesignandoperatingeffectivenessofinternalcontrolbasedontheassessedrisk,andperformingsuchotherproceduresasweconsiderednecessaryinthecircumstances.Webelievethatourauditprovidesareasonablebasisforouropinion.

Acompany'sinternalcontroloverfinancialreportingisaprocessdesignedtoprovidereasonableassuranceregardingthereliabilityoffinancialreportingandthepreparationoffinancialstatementsforexternalpurposesinaccordancewithgenerallyacceptedaccountingprinciples.Acompany'sinternalcontroloverfinancialreportingincludesthosepoliciesandproceduresthat:(1)pertaintothemaintenanceofrecordsthat,inreasonabledetail,accuratelyandfairlyreflectthetransactionsanddispositionsoftheassetsofthecompany;(2)providereasonableassurancethattransactionsarerecordedasnecessarytopermitpreparationoffinancialstatementsinaccordancewithgenerallyacceptedaccountingprinciples,andthatrevenuesandexpendituresofthecompanyarebeingmadeonlyinaccordancewithauthorizationsofmanagementanddirectorsofthecompany;and(3)providereasonableassuranceregardingpreventionortimelydetectionofunauthorizedacquisition,use,ordispositionofthecompany'sassetsthatcouldhaveamaterialeffectonthefinancialstatements.

Becauseofitsinherentlimitations,internalcontroloverfinancialreportingmaynotpreventordetectmisstatements.Also,projectionsofanyevaluationofeffectivenesstofutureperiodsaresubjecttotheriskthatcontrolsmaybecomeinadequatebecauseofchangesinconditionsorthatthedegreeofcompliancewiththepoliciesorproceduresmaydeteriorate.

Inouropinion,AgnicoEagleMinesLimitedmaintained,inallmaterialrespects,effectiveinternalcontroloverfinancialreportingasofDecember31,2015basedontheCOSOcriteria.

Wehavealsoaudited,inaccordancewiththestandardsofthePublicCompanyAccountingOversightBoard(UnitedStates),theconsolidatedbalancesheetsofAgnicoEagleMinesLimitedasofDecember31,2015andDecember31,2014,andtheconsolidatedstatementsofincomeandcomprehensiveincome,equityandcashflowsforeachoftheyearsendedDecember31,2015andDecember31,2014,andourreportdatedMarch23,2016expressedanunqualifiedopinionthereon.

/s/ERNST&YOUNGLLPToronto,Canada CharteredProfessionalAccountantsMarch23,2016 LicensedPublicAccountants

2 AGNICO EAGLE ANNUALAUDITEDCONSOLIDATEDFINANCIALSTATEMENTS

MANAGEMENT CERTIFICATION ManagementofAgnicoEagleMinesLimited("AgnicoEagle"orthe"Company")isresponsibleforestablishingandmaintainingadequateinternalcontroloverfinancialreporting.Internalcontroloverfinancialreportingisaprocessdesignedby,orunderthesupervisionof,theCompany'sChiefExecutiveOfficerandChiefFinancialOfficerandeffectedbytheCompany'sBoard,managementandotherpersonnel,toprovidereasonableassuranceregardingthereliabilityoffinancialreportingandthepreparationoffinancialstatementsforexternalpurposesinaccordancewithgenerallyacceptedaccountingprinciples.Becauseofitsinherentlimitations,internalcontroloverfinancialreportingmaynotpreventordetectmisstatements.Also,projectionsofanyevaluationofeffectivenesstofutureperiodsaresubjecttotheriskthatcontrolsmaybecomeinadequatebecauseofchangesinconditions,orthatthedegreeofcompliancewiththepoliciesorproceduresmaydeteriorate.

TheCompany'smanagement,includingtheCompany'sChiefExecutiveOfficerandChiefFinancialOfficer,assessedtheeffectivenessoftheCompany'sinternalcontroloverfinancialreportingasofDecember31,2015.Inmakingthisassessment,theCompany'smanagementusedthecriteriaoutlinedbytheCommitteeofSponsoringOrganizationsoftheTreadwayCommissioninInternal Control – Integrated Framework issuedin2013.Basedonitsassessment,managementconcludedthat,asofDecember31,2015,theCompany'sinternalcontroloverfinancialreportingwaseffective.

TheeffectivenessoftheCompany'sinternalcontroloverfinancialreportingasofDecember31,2015hasbeenauditedbyErnst&YoungLLP,anindependentregisteredpublicaccountingfirm,asstatedintheirreportthatappearsherein.

Toronto,CanadaMarch23,2016

By /s/SEANBOYD

SeanBoydVice-Chairman and Chief Executive Officer

By /s/DAVIDSMITH

DavidSmithSenior Vice-President, Finance and Chief Financial Officer

ANNUALAUDITEDCONSOLIDATEDFINANCIALSTATEMENTSAGNICO EAGLE 3

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM TotheBoardandShareholdersofAgnicoEagleMinesLimited:

WehaveauditedtheaccompanyingconsolidatedbalancesheetsofAgnicoEagleMinesLimitedasofDecember31,2015andDecember31,2014,andtherelatedconsolidatedstatementsofincomeandcomprehensiveincome,equityandcashflowsforeachoftheyearsendedDecember31,2015andDecember31,2014.ThesefinancialstatementsaretheresponsibilityoftheCompany'smanagement.Ourresponsibilityistoexpressanopiniononthesefinancialstatementsbasedonouraudits.

WeconductedourauditsinaccordancewiththestandardsofthePublicCompanyAccountingOversightBoard(UnitedStates).Thosestandardsrequirethatweplanandperformtheaudittoobtainreasonableassuranceaboutwhetherthefinancialstatementsarefreeofmaterialmisstatement.Anauditincludesexamining,onatestbasis,evidencesupportingtheamountsanddisclosuresinthefinancialstatements.Anauditalsoincludesassessingtheaccountingprinciplesusedandsignificantestimatesmadebymanagement,aswellasevaluatingtheoverallfinancialstatementpresentation.Webelievethatourauditsprovideareasonablebasisforouropinion.

Inouropinion,theconsolidatedfinancialstatementsreferredtoabovepresentfairly,inallmaterialrespects,theconsolidatedfinancialpositionofAgnicoEagleMinesLimitedatDecember31,2015andDecember31,2014andtheconsolidatedresultsofitsoperationsanditscashflowsforeachoftheyearsendedDecember31,2015andDecember31,2014inconformitywithInternationalFinancialReportingStandardsasissuedbytheInternationalAccountingStandardsBoard.

Wehavealsoaudited,inaccordancewiththestandardsofthePublicCompanyAccountingOversightBoard(UnitedStates),AgnicoEagleMinesLimited'sinternalcontroloverfinancialreportingasofDecember31,2015,basedoncriteriaestablishedinInternal Control – Integrated FrameworkissuedbytheCommitteeofSponsoringOrganizationsoftheTreadwayCommissionin2013,andourreportdatedMarch23,2016expressedanunqualifiedopinionthereon.

/s/ERNST&YOUNGLLPToronto,Canada CharteredProfessionalAccountantsMarch23,2016 LicensedPublicAccountants


AGNICO EAGLE MINES LIMITED CONSOLIDATED BALANCE SHEETS (thousands of United States dollars, except share amounts)

As at December 31,

2015

As at December 31,

2014

ASSETS

Currentassets:

Cashandcashequivalents $ 124,150 $ 177,537

Short-terminvestments 7,444 4,621

Restrictedcash(note7) 685 33,122

Tradereceivables(notes6and18) 7,714 59,716

Inventories(note8) 461,976 446,660

Incometaxesrecoverable(note24) 817 1,658

Available-for-salesecurities(notes6and9) 31,863 56,468

Fairvalueofderivativefinancialinstruments(notes6and21) 87 4,877

Othercurrentassets(note10(a)) 194,689 123,401

Totalcurrentassets 829,425 908,060

Non-currentassets:

Restrictedcash(note7) 741 20,899

Goodwill(note5) 696,809 696,809

Property,plantandminedevelopment(note11) 5,088,967 5,155,865

Otherassets(note10(b)) 67,238 27,622

Totalassets $ 6,683,180 $ 6,809,255

LIABILITIES AND EQUITY

Currentliabilities:

Accountspayableandaccruedliabilities(note12) $ 243,786 $ 209,906

Reclamationprovision(note13) 6,245 6,769

Interestpayable(note15) 14,526 13,816

Incometaxespayable(note24) 14,852 19,328

Financeleaseobligations(note14(a)) 9,589 22,142

Currentportionoflong-termdebt(note15) 14,451 52,182

Fairvalueofderivativefinancialinstruments(notes6and21) 8,073 8,249

Totalcurrentliabilities 311,522 332,392

Non-currentliabilities:

Long-termdebt(note15) 1,118,187 1,322,461

Reclamationprovision(note13) 276,299 249,917

(i)

Deferredincomeandminingtaxliabilities(note24) 802,114 797,192

Otherliabilities(note16) 34,038 38,803

Totalliabilities 2,542,160 2,740,765

EQUITY

Commonshares(note17):

Outstanding–218,028,368commonsharesissued,less377,573sharesheldintrust 4,707,940 4,599,788

Stockoptions(notes17and19) 216,232 200,830

Contributedsurplus 37,254 37,254

Deficit (823,734) (779,382)

Accumulatedothercomprehensiveincome 3,328 10,000

Totalequity 4,141,020 4,068,490

Totalliabilitiesandequity $ 6,683,180 $ 6,809,255

Commitmentsandcontingencies(note26)

Note:

(i) AssetoutinNote5,certainpreviouslyreportedDecember31,2014consolidatedbalancesheetlineitemshavebeenupdatedtoreflectadjustedfinalestimatesoffairvaluerelatedtotheJune16,2014jointacquisitionofOsiskoMiningCorporation("Osisko"),nowCanadianMalarticCorporation.

OnbehalfoftheBoard:

SeanBoydCPA,CA,Director Dr.LeanneM.Baker,Director

See accompanying notes



CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(thousands of United States dollars, except per share amounts)


2015 2014 REVENUES

Revenuesfromminingoperations(note18) $ 1,985,432 $ 1,896,766

COSTS, EXPENSES AND OTHER INCOME

Production(i) 995,295 1,004,559

Explorationandcorporatedevelopment 110,353 56,002

Amortizationofproperty,plantandminedevelopment(note11) 608,609 433,628

Generalandadministrative 96,973 118,771

Impairmentlossonavailable-for-salesecurities(note9) 12,035 15,763

Financecosts(note15) 75,228 73,393

Lossonderivativefinancialinstruments(note21) 19,608 6,156

Gainonsaleofavailable-for-salesecurities(note9) (24,600) (5,635)

Environmentalremediation(note13) 2,003 8,214

Foreigncurrencytranslation(gain)loss (4,728) 3,781

Otherexpenses(income) 12,028 (7,004)

Incomebeforeincomeandminingtaxes 82,628 189,138

Incomeandminingtaxesexpense(note24) 58,045 106,168

Netincomefortheyear $ 24,583 $ 82,970

Netincomepershare–basic(note17) $ 0.11 $ 0.43

Netincomepershare–diluted(note17) $ 0.11 $ 0.39

Cashdividendsdeclaredpercommonshare $ 0.32 $ 0.32

COMPREHENSIVE INCOME


Othercomprehensiveincome(loss):

Itemsthatmaybesubsequentlyreclassifiedtonetincome:

Available-for-salesecuritiesandotherinvestments:

Unrealizedchangeinfairvalueofavailable-for-salesecurities 4,822 (720)

Reclassificationtoimpairmentlossonavailable-for-salesecurities(note9) 12,035 15,763

Reclassificationtogainonsaleofavailable-for-salesecurities(note9) (24,600) (5,635)

Incometaximpactofreclassificationitems(note24) 1,684 (1,668)

Incometaximpactofothercomprehensiveincome(loss)items(note24) (613) 119

(6,672) 7,859

Itemsthatwillnotbesubsequentlyreclassifiedtonetincome:

Pensionbenefitobligations:

Remeasurementlossesofpensionbenefitobligations(note16(a)) (205) (858)

Incometaximpact(note24) 32 233

(173) (625)

Othercomprehensiveincome(loss)fortheyear (6,845) 7,234

Comprehensiveincomefortheyear $ 17,738 $ 90,204

Note:

(i) Exclusiveofamortization,whichisshownseparately.



AGNICO EAGLE MINES LIMITED CONSOLIDATED STATEMENTS OF EQUITY (thousands of United States dollars, except share and per share amounts)

Common Shares Outstanding

Shares

Amount

Stock Options

Contributed Surplus

Deficit

Accumulated Other

Comprehensive Income

Total Equity

Balance December 31, 2013 173,953,975 $3,294,007 $ 184,078 $ 37,254 $ (800,074) $ 2,141 $ 2,717,406

Netincome – – – – 82,970 – 82,970

Othercomprehensiveincome(loss) – – – – (625) 7,859 7,234

Totalcomprehensiveincome – – – – 82,345 7,859 90,204

Transactionswithowners:

Sharesissuedunderemployeestockoptionplan(notes17and19(a)) 582,925 21,083 (4,089) – – – 16,994

Stockoptions(notes17and19(a)) – – 20,841 – – – 20,841

Sharesissuedunderincentivesharepurchaseplan(note19(b)) 517,721 15,543 – – – – 15,543

Sharesissuedunderdividendreinvestmentplan 262,360 7,654 – – – – 7,654

SharesissuedforjointacquisitionofOsisko(note5) 34,794,843 1,164,237 – – – – 1,164,237

CommonsharesheldbyadepositoryrelatingtoCMGPConvertibleDebenturespreviouslyissuedbyOsisko(notes5and15) (871,680) (29,166) – – – – (29,166)

SharesissuedforCaydenacquisition(note5) 4,853,875 121,655 – – – – 121,655

Dividendsdeclared($0.32pershare) – – – – (61,653) – (61,653)

RestrictedShareUnitplan(notes17and19(c)) 142,215 4,775 – – – – 4,775


Netincome – – – – 24,583 – 24,583

Othercomprehensiveloss – – – – (173) (6,672) (6,845)

Totalcomprehensiveincome(loss) – – – – 24,410 (6,672) 17,738

Transactionswithowners:

Sharesissuedunderemployeestockoptionplan(notes17and19(a)) 747,683 22,326 (4,654) – – – 17,672

Stockoptions(notes17and19(a)) – – 20,056 – – – 20,056

Sharesissuedunderincentivesharepurchaseplan(note19(b)) 512,438 14,033 – – – – 14,033

Sharesissuedunderdividendreinvestmentplan 345,734 9,305 – – – – 9,305

SharesissuedforjointacquisitionofMalarticCHLproperty(note5) 459,197 13,441 – – – – 13,441

SharesissuedforacquisitionofSoltoroLtd.(note5) 770,429 24,351 – – – – 24,351

SharesissuedtosettleCMGPConvertibleDebenturespreviouslyissuedbyOsisko(note15) 871,680 24,779 – – – – 24,779

Dividendsdeclared($0.32pershare) – – – – (68,762) – (68,762)

RestrictedShareUnitplanandLongTermIncentivePlan("LTIP")(notes17and19(c)) (292,600) (83) – – – – (83)




AGNICO EAGLE MINES LIMITED CONSOLIDATED STATEMENTS OF CASH FLOWS (thousands of United States dollars)


2015 2014 OPERATING ACTIVITIES


Add(deduct)itemsnotaffectingcash:

Amortizationofproperty,plantandminedevelopment(note11) 608,609 433,628

Deferredincomeandminingtaxes(note24) 6,550 37,058

Gainonsaleofavailable-for-salesecurities(note9) (24,600) (5,635)

Stock-basedcompensation(note19) 35,822 37,565

Impairmentlossonavailable-for-salesecurities(note9) 12,035 15,763

Foreigncurrencytranslation(gain)loss (4,728) 3,781

Other 3,145 23,430

Adjustmentforsettlementofreclamationprovision (1,385) (4,160)

Changesinnon-cashworkingcapitalbalances:

Tradereceivables 52,019 17,237

Incometaxes (2,333) 30,771

Inventories (40,547) (1,354)

Othercurrentassets (74,106) 787

Accountspayableandaccruedliabilities 20,464 (3,391)

Interestpayable 710 (126)

Cashprovidedbyoperatingactivities 616,238 668,324

INVESTING ACTIVITIES

Additionstoproperty,plantandminedevelopment(note11) (449,758) (475,412)

Acquisitions,netofcashandcashequivalentsacquired(note5) (12,983) (400,032)

Netpurchasesofshort-terminvestments (2,823) (2,404)

Netproceedsfromsaleofavailable-for-salesecuritiesandwarrants(note9) 61,075 44,692

Purchaseofavailable-for-salesecuritiesandwarrants(note9) (19,815) (27,246)

Decreaseinrestrictedcash(note7) 49,785 8,783

Cashusedininvestingactivities (374,519) (851,619)

FINANCING ACTIVITIES

Dividendspaid (59,512) (54,065)

Repaymentoffinanceleaseobligations(note14(a)) (23,657) (21,453)

Sale-leasebackfinancing(note14(a)) – 1,027

Proceedsfromlong-termdebt 436,000 1,010,000

Repaymentoflong-termdebt (697,086) (724,050)

Noteissuance(note15) 50,000 –

Long-termdebtfinancing(note15) (1,689) (2,127)

RepurchaseofcommonsharesforRestrictedShareUnitplan(notes17and19(c)) (11,899) (7,518)

Proceedsonexerciseofstockoptions(note19(a)) 17,672 16,994

Commonsharesissued(note17) 9,411 10,428

Cash(usedin)providedbyfinancingactivities (280,760) 229,236

Effect of exchange rate changes on cash and cash equivalents (14,346) (7,505)

Net (decrease) increase in cash and cash equivalents during the year (53,387) 38,436

Cash and cash equivalents, beginning of year 177,537 139,101

Cash and cash equivalents, end of year $ 124,150 $ 177,537

SUPPLEMENTAL CASH FLOW INFORMATION

Interestpaid(note15) $ 69,414 $ 67,632

Incomeandminingtaxespaid $ 81,112 $ 51,302




NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(thousands of United States dollars, except share and per share amounts, unless otherwise indicated) December 31, 2015

1. CORPORATE INFORMATION

AgnicoEagleMinesLimited("AgnicoEagle"orthe"Company")isprincipallyengagedintheproductionandsaleofgold,aswellasrelatedactivitiessuchasexplorationandminedevelopment.TheCompany'sminingoperationsarelocatedinCanada,MexicoandFinlandandtheCompanyhasexplorationactivitiesinCanada,Europe,LatinAmericaandtheUnitedStates.AgnicoEagleisapubliccompanyincorporatedunderthelawsoftheProvinceofOntario,Canadawithitsheadandregisteredofficelocatedat145KingStreetEast,Suite400,Toronto,Ontario,M5C2Y7.TheCompanyislistedontheTorontoStockExchangeandtheNewYorkStockExchange.AgnicoEaglesellsitsgoldproductionintotheworldmarket.

TheseconsolidatedfinancialstatementswereauthorizedforissuancebytheBoardofDirectorsoftheCompany(the"Board")onMarch23,2016.

2. BASIS OF PRESENTATION

A) StatementofCompliance

TheaccompanyingconsolidatedfinancialstatementsofAgnicoEaglehavebeenpreparedinaccordancewithInternationalFinancialReportingStandards("IFRS")asissuedbytheInternationalAccountingStandardsBoard("IASB")inUnitedStates("US")dollars.

Theseconsolidatedfinancialstatementswerepreparedonagoingconcernbasisunderthehistoricalcostmethodexceptforcertainfinancialassetsandliabilitieswhicharemeasuredatfairvalue.Significantaccountingpoliciesarepresentedinnote3totheseconsolidatedfinancialstatementsandhavebeenconsistentlyappliedineachoftheperiodspresented.

B) BasisofPresentation

Subsidiaries

TheseconsolidatedfinancialstatementsincludetheaccountsofAgnicoEagleanditsconsolidatedsubsidiaries.Allintercompanybalances,transactions,incomeandexpensesandgainsorlosseshavebeeneliminatedonconsolidation.SubsidiariesareconsolidatedwhereAgnicoEaglehastheabilitytoexercisecontrol.ControlofaninvesteeexistswhenAgnicoEagleisexposedtovariablereturnsfromtheCompany'sinvolvementwiththeinvesteeandhastheabilitytoaffectthosereturnsthroughitspowerovertheinvestee.TheCompanyreassesseswhetherornotitcontrolsaninvesteeiffactsandcircumstancesindicatethattherearechangestooneormoreoftheelementsofcontrol.

Joint Arrangements

Ajointarrangementisdefinedasanarrangementinwhichtwoormorepartieshavejointcontrol.Jointcontrolisthecontractuallyagreedsharingofcontroloveranarrangementbetweentwoormoreparties.Thisexistsonlywhenthedecisionsabouttherelevantactivitiesthatsignificantlyaffectthereturnsofthearrangementrequiretheunanimousconsentofthepartiessharingcontrol.

Ajointoperationisajointarrangementwherebythepartieshavejointcontrolofthearrangementandhaverightstotheassetsandobligationsfortheliabilitiesrelatingtothearrangement.TheseconsolidatedfinancialstatementsincludetheCompany'sinterestsintheassets,liabilities,revenuesandexpensesofthejointoperations,fromthedatethatjointcontrolcommenced.AgnicoEagle's50%interestinCanadianMalarticCorporationandCanadianMalarticGP,thegeneralpartnershipthatholdstheCanadianMalarticminelocatedinQuebec,hasbeenaccountedforasajointoperation.


3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A) BusinessCombinations

Inabusinesscombination,theacquisitionmethodofaccountingisused,wherebythepurchaseconsiderationisallocatedtothefairvalueofidentifiableassetsacquiredandliabilitiesassumedatthedateofacquisition.Preliminaryfairvaluesallocatedatareportingdatearefinalizedassoonastherelevantinformationisavailable,withinaperiodnottoexceedtwelvemonthsfromtheacquisitiondatewithretroactiverestatementoftheimpactofadjustmentstothosepreliminaryfairvalueseffectiveasattheacquisitiondate.AssetoutinNote5totheseconsolidatedfinancialstatements,certainpreviouslyreportedDecember31,2014consolidatedbalancesheetlineitemshavebeenupdatedtoreflectfinalestimatesoffairvaluerelatedtotheJune16,2014jointacquisitionofOsisko.Acquisitionrelatedcostsareexpensedasincurred.

Purchaseconsiderationmayalsoincludeamountspayableiffutureeventsoccurorconditionsaremet.Anysuchcontingentconsiderationismeasuredatfairvalueandincludedinthepurchaseconsiderationattheacquisitiondate.Subsequentchangestotheestimatedfairvalueofcontingentconsiderationarerecordedthroughtheconsolidatedstatementsofincome,unlessthepreliminaryfairvalueofcontingentconsiderationasattheacquisitiondateisfinalizedbeforethetwelvemonthmeasurementperiodinwhichcasetheadjustmentisallocatedtotheidentifiableassetsacquiredandliabilitiesassumedretrospectivelytotheacquisitiondate.

Wherethecostoftheacquisitionexceedsthefairvaluesoftheidentifiablenetassetsacquired,thedifferenceisrecordedasgoodwill.Againisrecordedthroughtheconsolidatedstatementsofincomeifthecostoftheacquisitionislessthanthefairvaluesoftheidentifiablenetassetsacquired.

Non-controllinginterestsrepresentthefairvalueofnetassetsinsubsidiariesthatarenotheldbytheCompanyasatthedateofacquisition.Non-controllinginterestsarepresentedintheequitysectionoftheconsolidatedbalancesheets.

Inabusinesscombinationachievedinstages,theCompanyremeasuresanypreviouslyheldequityinterestatitsacquisitiondatefairvalueandrecognizesanygainorlossintheconsolidatedstatementsofincome.

B) Non-currentAssetsandDisposalGroupsHeldForSaleandDiscontinuedOperations

TheCompanyclassifiesanon-currentassetordisposalgroupasheldforsaleifitishighlyprobablethattheywillbesoldintheircurrentconditionwithinoneyearfromthedateofclassification.AssetsanddisposalgroupsthatmeetthecriteriatobeclassifiedasanassetheldforsalearemeasuredatthelowerofcarryingamountandfairvaluelesscoststodisposeandtheCompanystopsamortizingsuchassetsfromthedatetheyareclassifiedasheldforsale.Assetsanddisposalgroupsthatmeetthecriteriatobeclassifiedasheldforsalearepresentedseparatelyintheconsolidatedbalancesheets.

Ifthecarryingamountoftheassetpriortobeingclassifiedasheldforsaleisgreaterthanthefairvaluelesscoststodispose,theCompanyrecognizesanimpairmentloss.Anysubsequentchangeinthemeasurementamountofitemsclassifiedasheldforsaleisrecognizedasagain,totheextentofanycumulativeimpairmentchargespreviouslyrecognizedtotherelatedassetordisposalgroup,orasafurtherimpairmentloss.

AdiscontinuedoperationisacomponentoftheCompanythatcanbeclearlydistinguishedfromtherestoftheentity,bothoperationallyandforfinancialreportingpurposes,thathasbeendisposedoforisclassifiedasheldforsaleandrepresents:a)aseparatesignificantlineofbusinessorgeographicalareaofoperations;b)apartofasingleco-ordinatedplantodisposeofanareaofoperations;orc)asubsidiaryacquiredexclusivelyforresale.Theresultsofthedisposalgroupsorregionswhicharediscontinuedoperationsarepresentedseparatelyintheconsolidatedstatementsofcomprehensiveincome.


C) ForeignCurrencyTranslation

ThefunctionalcurrencyoftheCompany,foreachsubsidiaryandforjointarrangements,isthecurrencyoftheprimaryeconomicenvironmentinwhichitoperates.ThefunctionalcurrencyofalloftheCompany'soperationsistheUSdollar.

OncetheCompanydeterminesthefunctionalcurrencyofanentity,itisnotchangedunlessthereisachangeintherelevantunderlyingtransactions,eventsandcircumstances.Anychangeinanentity'sfunctionalcurrencyisaccountedforprospectivelyfromthedateofthechange,andtheconsolidatedbalancesheetsaretranslatedusingtheexchangerateatthatdate.

Attheendofeachreportingperiod,theCompanytranslatesforeigncurrencybalancesasfollows:

• Monetaryitemsaretranslatedattheclosingrateineffectattheconsolidatedbalancesheetdate;

• Non-monetaryitemsthataremeasuredintermsofhistoricalcostaretranslatedusingtheexchangerateatthedateofthetransaction.Itemsmeasuredatfairvaluearetranslatedattheexchangerateineffectatthedatethefairvaluewasmeasured;and

• Revenueandexpenseitemsaretranslatedusingtheaverageexchangerateduringtheperiod.

D) CashandCashEquivalents

TheCompany'scashandcashequivalentsincludecashonhandandshort-terminvestmentsinmoneymarketinstrumentswithremainingmaturitiesofthreemonthsorlessatthedateofpurchase.TheCompanyplacesitscashandcashequivalentsandshort-terminvestmentsinhighqualitysecuritiesissuedbygovernmentagencies,financialinstitutionsandmajorcorporationsandlimitstheamountofcreditexposurebydiversifyingitsholdings.

E) Short-termInvestments

TheCompany'sshort-terminvestmentsincludefinancialinstrumentswithremainingmaturitiesofgreaterthanthreemonthsbutlessthanoneyearatthedateofpurchase.Short-terminvestmentsaredesignatedasheldtomaturityforaccountingpurposesandarecarriedatamortizedcost,whichapproximatesmarketvaluegiventheshort-termnatureoftheseinvestments.

F) Inventories

Inventoriesconsistoforestockpiles,concentrates,dorebarsandsupplies.Inventoriesarecarriedatthelowerofcostandnetrealizablevalue("NRV").Costisdeterminedusingtheweightedaveragebasisandincludesallcostsofpurchase,costsofconversionandothercostsincurredinbringingtheinventoriestotheirpresentlocationandcondition.Costofinventoriesincludesdirectcostsofmaterialsandlabourrelateddirectlytominingandprocessingactivities,includingproductionphasestrippingcosts,amortizationofproperty,plantandminedevelopmentdirectlyinvolvedintherelatedminingandproductionprocess,amortizationofanystrippingcostspreviouslycapitalizedanddirectlyattributableoverheadcosts.Wheninterruptionstoproductionoccur,anadjustmentismadetothecostsincludedininventories,suchthattheyreflectnormalcapacity.Abnormalcostsareexpensedintheperiodtheyareincurred.

Thecurrentportionoforestockpiles,oreinleachpadsandinventoriesisdeterminedbasedontheexpectedamountstobeprocessedwithinthenexttwelvemonths.Orestockpiles,oreonleachpadsandinventoriesnotexpectedtobeprocessedorusedwithinthenexttwelvemonthsareclassifiedaslong-term.

NRVisestimatedbycalculatingthenetsellingpricelesscoststobeincurredinconvertingtherelevantinventoriestosaleableproductanddeliveringittoacustomer.Coststocompletearebasedonmanagement'sbestestimateas


attheconsolidatedbalancesheetdate.AnNRVimpairmentmaybereversedinasubsequentperiodifthecircumstancesthattriggeredtheimpairmentnolongerexist.

G) FinancialInstruments

TheCompany'sfinancialassetsandliabilities(financialinstruments)includecashandcashequivalents,short-terminvestments,restrictedcash,tradereceivables,available-for-salesecurities,accountspayableandaccruedliabilities,long-termdebt(includingconvertibledebentures)andderivativefinancialinstruments.Allfinancialinstrumentsarerecordedatfairvalueatrecognition.Subsequenttoinitialrecognition,financialinstrumentsclassifiedastradereceivables,accountspayableandaccruedliabilitiesandlong-termdebt(excludingconvertibledebentures)aremeasuredatamortizedcostusingtheeffectiveinterestmethod.Otherfinancialassetsandliabilitiesarerecordedatfairvaluethroughtheconsolidatedstatementsofincome.

Available-for-sale Securities

TheCompany'sinvestmentsinavailable-for-salesecuritiesconsistprimarilyofinvestmentsincommonsharesofentitiesintheminingindustryrecordedusingtradedateaccounting.Investmentsaredesignatedasavailable-for-salebasedonthecriteriathattheCompanydoesnotholdthesefortradingpurposes.Thecostbasisofavailable-for-salesecuritiesisdeterminedusingtheaveragecostmethodandtheyarecarriedatfairvalue.Unrealizedgainsandlossesrecordedtomeasureavailable-for-salesecuritiesatfairvaluearerecognizedinothercomprehensiveincome.

Intheeventthatadeclineinthefairvalueofaninvestmentinavailable-for-salesecuritiesoccursandthedeclineinvalueisconsideredtobesignificantorprolonged,animpairmentchargeisrecordedintheconsolidatedstatementsofincomeandcomprehensiveincome.TheCompanyassesseswhetheradeclineinvalueisconsideredtobesignificantorprolongedbyconsideringavailableevidence,includingchangesingeneralmarketconditions,specificindustryandinvesteedata,thelengthoftimeandtheextenttowhichthefairvaluehasbeenlessthancostandthefinancialconditionoftheinvestee.

Derivative Instruments and Hedge Accounting

TheCompanyusesderivativefinancialinstruments(primarilyoptionandforwardcontracts)tomanageexposuretofluctuationsinby-productmetalprices,interestratesandforeigncurrencyexchangeratesandmayusesuchmeanstomanageexposuretocertaininputcosts.TheCompanydoesnotholdfinancialinstrumentsorderivativefinancialinstrumentsfortradingpurposes.

TheCompanyrecognizesallderivativefinancialinstrumentsintheconsolidatedfinancialstatementsatfairvalueregardlessofthepurposeorintentforholdingtheinstrument.Changesinthefairvalueofderivativefinancialinstrumentsareeitherrecognizedperiodicallyintheconsolidatedstatementsofincomeandcomprehensiveincomeorinequityasacomponentofaccumulatedothercomprehensiveincome,dependingonthenatureofthederivativefinancialinstrumentandwhetheritqualifiesforhedgeaccounting.Financialinstrumentsdesignatedashedgesaretestedforeffectivenessateachreportingperiod.Realizedgainsandlossesonthosecontractsthatareproventobeeffectivearereportedasacomponentoftherelatedtransaction.

H) Goodwill

Goodwillisrecognizedinabusinesscombinationifthecostoftheacquisitionexceedsthefairvaluesoftheidentifiablenetassetsacquired.Goodwillisthenallocatedtothecashgeneratingunit("CGU")orgroupofCGUsthatareexpectedtobenefitfromthesynergiesofthecombination.ACGUisthesmallestidentifiablegroupofassetsthatgeneratescashinflowswhicharelargelyindependentofthecashinflowsfromotherassetsorgroupsofassets.


TheCompanyperformsgoodwillimpairmenttestsonanannualbasisasatDecember31eachyear.Inaddition,theCompanyassessesforindicatorsofimpairmentateachreportingperiodendand,ifanindicatorofimpairmentisidentified,goodwillistestedforimpairmentatthattime.IfthecarryingvalueoftheCGUorgroupofCGUstowhichgoodwillisassignedexceedsitsrecoverableamount,animpairmentlossisrecognized.Goodwillimpairmentlossesarenotreversed.

TherecoverableamountofaCGUorgroupofCGUsismeasuredasthehigherofvalueinuseandfairvaluelesscostsofdisposal.

I) MiningProperties,PlantandEquipmentandMineDevelopmentCosts

Miningproperties,plantandequipmentandminedevelopmentcostsarerecordedatcost,lessaccumulatedamortizationandaccumulatedimpairmentlosses.

Mining Properties

Thecostofminingpropertiesincludesthefairvalueattributabletoprovenandprobablemineralreservesandmineralresourcesacquiredinabusinesscombinationorassetacquisition,undergroundminedevelopmentcosts,deferredstripping,capitalizedexplorationandevaluationcostsandcapitalizedborrowingcosts.

Significantpaymentsrelatedtotheacquisitionoflandandmineralrightsarecapitalizedasminingpropertiesatcost.Ifamineableorebodyisdiscovered,suchcostsareamortizedtoincomewhencommercialproductioncommences,usingtheunits-of-productionmethod,basedonestimatedprovenandprobablemineralreserves.Ifnomineableorebodyisdiscovered,suchcostsareexpensedintheperiodinwhichitisdeterminedthatthepropertyhasnofutureeconomicvalue.Costcomponentsofaspecificprojectthatareincludedinthecapitalcostoftheassetincludesalariesandwagesdirectlyattributabletotheproject,suppliesandmaterialsusedintheproject,andincrementaloverheadcoststhatcanbedirectlyattributabletotheproject.

Assetsunderconstructionarenotamortizeduntiltheendoftheconstructionperiodoroncecommercialproductionisachieved.Uponachievingtheproductionstage,thecapitalizedconstructioncostsaretransferredtotheappropriatecategoryofplantandequipment.

Plant and Equipment

Expendituresfornewfacilitiesandimprovementsthatcanextendtheusefullivesofexistingfacilitiesarecapitalizedasplantandequipmentatcost.Thecostofanitemofplantandequipmentincludes:itspurchaseprice,includingimportdutiesandnon-refundablepurchasetaxes,afterdeductingtradediscountsandrebates;anycostsdirectlyattributabletobringingtheassettothelocationandconditionnecessaryforittobecapableofoperatinginthemannerintendedbymanagement;andtheestimateofthecostsofdismantlingandremovingtheitemandrestoringthesiteonwhichitislocatedotherthancoststhatariseasaconsequenceofhavingusedtheitemtoproduceinventoriesduringtheperiod.

Amortizationofanassetbeginswhentheassetisinthelocationandconditionnecessaryforittooperateinthemannerintendedbymanagement.Amortizationceasesattheearlierofthedatetheassetisclassifiedasheldforsaleorthedatetheassetisderecognized.Assetsunderconstructionarenotamortizeduntiltheendoftheconstructionperiod.Amortizationischargedaccordingtoeithertheunits-of-productionmethodoronastraight-linebasis,accordingtothepatterninwhichtheasset'sfutureeconomicbenefitsareexpectedtobeconsumed.Theamortizationmethodappliedtoanassetisreviewedatleastannually.

Usefullivesofproperty,plantandequipmentarebasedonestimatedminelivesasdeterminedbyprovenandprobablemineralreserves.RemainingminelivesatDecember31,2015rangefrom1to20years.


Mine Development Costs

Minedevelopmentcostsincurredafterthecommencementofcommercialproductionarecapitalizedwhentheyareexpectedtohaveafutureeconomicbenefit.Activitiesthataretypicallycapitalizedincludecostsincurredtobuildshafts,drifts,rampsandaccesscorridorswhichenablestheCompanytoextractoreunderground.

TheCompanyrecordsamortizationonundergroundminedevelopmentcostsonaunits-of-productionbasisbasedontheestimatedtonnageofprovenandprobablemineralreservesoftheidentifiedcomponentoftheorebody.Theunits-of-productionmethoddefinesthedenominatorasthetotaltonnageofprovenandprobablemineralreserves.

Deferred Stripping

Inopenpitminingoperations,itisnecessarytoremoveoverburdenandotherwastematerialstoaccessorefromwhichmineralscanbeextractedeconomically.Theprocessofminingoverburdenandwastematerialsisreferredtoasstripping.

Duringthedevelopmentstageofthemine,strippingcostsarecapitalizedaspartofthecostofbuilding,developingandconstructingthemineandareamortizedoncetheminehasenteredtheproductionstage.

Duringtheproductionstageofamine,strippingcostsarerecordedasapartofthecostofinventoriesunlessthesecostsareexpectedtoprovideafutureeconomicbenefitand,insuchcases,arecapitalizedtoproperty,plantandminedevelopment.

Productionstagestrippingcostsprovideafutureeconomicbenefitwhen:

• Itisprobablethatthefutureeconomicbenefit(e.g. ,improvedaccesstotheorebody)associatedwiththestrippingactivitywillflowtotheCompany;

• TheCompanycanidentifythecomponentoftheorebodyforwhichaccesshasbeenimproved;and

• Thecostsrelatingtothestrippingactivityassociatedwiththatcomponentcanbemeasuredreliably.

Capitalizedproductionstagestrippingcostsareamortizedovertheexpectedusefullifeoftheidentifiedcomponentoftheorebodythatbecomesmoreaccessibleasaresultofthestrippingactivity.

Borrowing Costs

Borrowingcostsarecapitalizedtoqualifyingassets.QualifyingassetsareassetsthattakeasubstantialperiodoftimetopreparefortheCompany'sintendeduse,whichincludesprojectsthatareintheexplorationandevaluation,developmentorconstructionstages.

Borrowingcostsattributabletotheacquisition,constructionorproductionofqualifyingassetsareaddedtothecostofthoseassetsuntilsuchtimeastheassetsaresubstantiallyreadyfortheirintendeduse.Allotherborrowingcostsarerecognizedasfinancecostsintheperiodinwhichtheyareincurred.Wherethefundsusedtofinanceaqualifyingassetformpartofgeneralborrowings,theamountcapitalizediscalculatedusingaweightedaverageofratesapplicabletotherelevantborrowingsduringtheperiod.

Leases

Thedeterminationofwhetheranarrangementis,orcontains,aleaseisbasedonthesubstanceofthearrangementattheinceptiondate,includingwhetherthefulfillmentofthearrangementisdependentontheuseofaspecificassetorassetsorwhetherthearrangementconveysarighttousetheasset.

LeasingarrangementsthattransfersubstantiallyalltherisksandrewardsofownershipoftheassettotheCompanyareclassifiedasfinanceleases.Financeleasesarerecordedasanassetwithacorrespondingliabilityatanamount


equaltothelowerofthefairvalueoftheleasedassetsandthepresentvalueoftheminimumleasepayments.Eachleasepaymentisallocatedbetweentheliabilityandfinancecostsusingtheeffectiveinterestratemethod,wherebyaconstantrateofinterestexpenseisrecognizedonthebalanceoftheliabilityoutstanding.Theinterestelementoftheleaseischargedtotheconsolidatedstatementofincomeasafinancecost.Anassetleasedunderafinanceleaseisamortizedovertheshorteroftheleasetermanditsusefullife.

Allotherleasesarerecognizedasoperatingleases.Operatingleasepaymentsarerecognizedasanoperatingexpenseintheconsolidatedstatementsofincomeonastraight-linebasisovertheleaseterm.

J) DevelopmentStageExpenditures

Developmentstageexpendituresarecostsincurredtoobtainaccesstoprovenandprobablemineralreservesandprovidefacilitiesforextracting,treating,gathering,transportingandstoringtheminerals.Thedevelopmentstageofaminecommenceswhenthetechnicalfeasibilityandcommercialviabilityofextractingthemineralresourcehasbeendetermined.Coststhataredirectlyattributabletominedevelopmentarecapitalizedasproperty,plantandminedevelopmenttotheextentthattheyarenecessarytobringthepropertytocommercialproduction.

Abnormalcostsareexpensedasincurred.Indirectcostsareincludedonlyiftheycanbedirectlyattributedtotheareaofinterest.Generalandadministrativecostsarecapitalizedaspartofthedevelopmentexpenditureswhenthecostsaredirectlyattributedtoaspecificminingdevelopmentproject.

Commercial Production

Amineconstructionprojectisconsideredtohaveenteredtheproductionstagewhenthemineconstructionassetsareavailableforuse.Indeterminingwhethermineconstructionassetsareconsideredavailableforuse,thecriteriaconsideredinclude,butarenotlimitedto,thefollowing:

• Completionofareasonableperiodoftestingmineplantandequipment;

• Abilitytoproducemineralsinsaleableform(withinspecifications);and

• Abilitytosustainongoingproductionofminerals.

Whenamineconstructionprojectmovesintotheproductionstage,amortizationcommences,thecapitalizationofcertainmineconstructioncostsceasesandexpendituresareeithercapitalizedtoinventoriesorexpensedasincurred.Exceptionsincludecostsincurredforadditionsorimprovementstoproperty,plantandminedevelopmentandopen-pitstrippingactivities.

K) ImpairmentofLong-livedAssets

AttheendofeachreportingperiodtheCompanyassesseswhetherthereisanyindicationthatlong-livedassetsmaybeimpaired.Ifanindicatorofimpairmentexists,therecoverableamountoftheassetiscalculatedinordertodetermineifanyimpairmentlossisrequired.Ifitisnotpossibletoestimatetherecoverableamountoftheindividualasset,assetsaregroupedattheCGUlevelforthepurposeofassessingtherecoverableamount.AnimpairmentlossisrecognizedforanyexcessofthecarryingamountoftheCGUoveritsrecoverableamount.TheimpairmentlossrelatedtoaCGUisfirstallocatedtogoodwillandtheremaininglossisallocatedonapro-ratabasistotheremaininglong-livedassetsoftheCGUbasedontheircarryingamounts.

Anyimpairmentchargethatistakenonalong-livedassetexceptgoodwillisreversediftherearesubsequentchangesintheestimatesorsignificantassumptionsthatwereusedtorecognizetheimpairmentlossthatresultinanincreaseintherecoverableamountoftheCGU.Ifanindicatorofimpairmentreversalhasbeenidentified,arecoveryshouldberecognizedtotheextenttherecoverableamountoftheassetexceedsitscarryingamount.Theamountofthereversalislimitedtothedifferencebetweenthecurrentcarryingamountandtheamountwhich


wouldhavebeenthecarryingamounthadtheearlierimpairmentnotbeenrecognizedandamortizationofthatcarryingamounthadcontinued.Impairmentsandsubsequentreversalsarerecordedintheconsolidatedstatementofincomeintheperiodinwhichtheyoccur.

L) Debt

Debtisinitiallyrecordedatfairvalue,netoffinancingcostsincurred.Debtissubsequentlymeasuredatamortizedcost.Anydifferencebetweentheamountsreceivedandtheredemptionvalueofthedebtisrecognizedintheconsolidatedstatementsofincomeovertheperiodtomaturityusingtheeffectiveinterestratemethod.Convertibledebenturesareaccountedforasafinancialliabilitymeasuredatfairvalueintheconsolidatedstatementsofincome.

M) ReclamationProvisions

Assetretirementobligations("AROs")arisefromtheacquisition,developmentandconstructionofminingpropertiesandplantandequipmentduetogovernmentcontrolsandregulationsthatprotecttheenvironmentontheclosureandreclamationofminingproperties.ThemajorpartsofthecarryingamountofAROsrelatetotailingsandheapleachpadclosureandrehabilitation,demolitionofbuildingsandminefacilities,ongoingwatertreatmentandongoingcareandmaintenanceofclosedmines.TheCompanyrecognizesanAROatthetimetheenvironmentaldisturbanceoccursoraconstructiveobligationisdeterminedtoexistbasedontheCompany'sbestestimateofthetimingandamountofexpectedcashflowsexpectedtobeincurred.WhentheAROprovisionisrecognized,thecorrespondingcostiscapitalizedtotherelateditemofproperty,plantandminedevelopment.Reclamationprovisionsthatresultfromdisturbanceinthelandtoextractoreinthecurrentperiodisincludedinthecostofinventories.

Thetimingoftheactualenvironmentalremediationexpendituresisdependentonanumberoffactorssuchasthelifeandnatureoftheasset,theoperatinglicenceconditionsandtheenvironmentinwhichthemineoperates.Reclamationprovisionsaremeasuredattheexpectedvalueoffuturecashflowsdiscountedtotheirpresentvalueusingarisk-freeinterestrate.AROsareadjustedeachperiodtoreflectthepassageoftime(accretion).Accretionexpenseisrecordedinfinancingcostseachperiod.UponsettlementofanARO,theCompanyrecordsagainorlossiftheactualcostdiffersfromthecarryingamountoftheARO.Settlementgainsorlossesarerecordedintheconsolidatedstatementsofincome.

Expectedcashflowsareupdatedtoreflectchangesinfactsandcircumstances.Theprincipalfactorsthatcancauseexpectedcashflowstochangearetheconstructionofnewprocessingfacilities,changesinthequantitiesofmaterialinprovenandprobablemineralreservesandacorrespondingchangeinthelife-of-mineplan,changingorecharacteristicsthatimpactrequiredenvironmentalprotectionmeasuresandrelatedcosts,changesinwaterqualitythatimpacttheextentofwatertreatmentrequiredandchangesinlawsandregulationsgoverningtheprotectionoftheenvironment.

Eachreportingperiod,provisionsforAROsareremeasuredtoreflectanychangestosignificantassumptions,includingtheamountandtimingofexpectedcashflowsandrisk-freeinterestrates.Changestothereclamationprovisionresultingfromchangesinestimateareaddedtoordeductedfromthecostoftherelatedasset,exceptwherethereductionofthereclamationprovisionexceedsthecarryingvalueoftherelatedassetsinwhichcasetheassetisreducedtonilandtheremainingadjustmentisrecognizedintheconsolidatedstatementsofincome.

Environmentalremediationliabilities("ERLs")aredifferentiatedfromAROsinthatERLsdonotarisefromenvironmentalcontaminationinthenormaloperationofalong-livedassetorfromalegalorconstructiveobligationtotreatenvironmentalcontaminationresultingfromtheacquisition,constructionordevelopmentofalong-livedasset.TheCompanyisrequiredtorecognizealiabilityforobligationsassociatedwithERLsarisingfrompastacts.


ERLsaremeasuredbydiscountingtheexpectedrelatedcashflowsusingarisk-freeinterestrate.TheCompanypreparesestimatesofthetimingandamountofexpectedcashflowswhenanERLisincurred.Eachreportingperiod,theCompanyassessescostestimatesandotherassumptionsusedinthevaluationofERLstoreflectevents,changesincircumstancesandnewinformationavailable.ChangesinthesecostestimatesandassumptionshaveacorrespondingimpactonthevalueoftheERL.AnychangeinthevalueofERLsresultsinacorrespondingchargeorcredittotheconsolidatedstatementsofincome.UponsettlementofanERL,theCompanyrecordsagainorlossiftheactualcostdiffersfromthecarryingamountoftheERLintheconsolidatedstatementsofincome.

N) Post-employmentBenefits

InCanada,theCompanymaintainsadefinedcontributionplancoveringallofitsemployees(the"BasicPlan").TheBasicPlanisfundedbyCompanycontributionsbasedonapercentageofincomeforservicesrenderedbyemployees.Inaddition,theCompanyhasasupplementalplanfordesignatedexecutivesatthelevelofVice-Presidentorabove(the"SupplementalPlan").UndertheSupplementalPlan,anadditional10.0%ofthedesignatedexecutives'incomeiscontributedbytheCompany.TheCompanydoesnotofferanyotherpost-retirementbenefitstoitsemployees.

TheCompanyalsoprovidesanon-registeredsupplementaryexecutiveretirementdefinedbenefitplanforcertaincurrentandformerseniorofficers(the"ExecutivesPlan").TheExecutivesPlanbenefitsaregenerallybasedontheemployee'syearsofserviceandlevelofcompensation.PensionexpenserelatedtotheExecutivesPlanisthenetofthecostofbenefitsprovided(includingthecostofanybenefitsprovidedforpastservice),thenetinterestcostonthenetdefinedliability/asset,andtheeffectsofsettlementsandcurtailmentsrelatedtospecialevents.Pensionfundassetsaremeasuredattheircurrentfairvalues.Thecostsofpensionplanimprovementsarerecognizedimmediatelyinexpensewhentheyoccur.Remeasurementsofthenetdefinedbenefitliabilityarerecognizedimmediatelyinothercomprehensiveincome(loss)andaresubsequentlytransferredtoretainedearnings.

Defined Contribution Plan

TheCompanyrecognizesthecontributionspayabletoadefinedcontributionplaninexchangeforservicesrenderedbyemployeesasanexpense,unlessanotherpolicyrequiresorpermitstheinclusionofthecontributioninthecostofanasset.Afterdeductingcontributionsalreadypaid,aliabilityisrecordedthroughouteachperiodtoreflectunpaidbutearnedcontributions.Ifthecontributionpaidexceedsthecontributionduefortheservicebeforetheendofthereportingperiod,theCompanyrecognizesthatexcessasanassettotheextentthattheprepaymentwillleadtoareductioninfuturepaymentsoracashrefund.

Defined Benefit Plan

Planassetsaremeasuredattheirfairvalueattheconsolidatedbalancesheetdateandaredeductedfromthepresentvalueofplanliabilitiestoarriveatanetdefinedbenefitliability/asset.Thedefinedbenefitobligationreflectstheexpectedfuturepaymentsrequiredtosettletheobligationresultingfromemployeeserviceinthecurrentandpriorperiods.

Currentservicecostrepresentstheactuariallycalculatedpresentvalueofthebenefitsearnedbytheactiveemployeesineachperiodandreflectstheeconomiccostforeachperiodbasedoncurrentmarketconditions.Thecurrentservicecostisbasedonthemostrecentactuarialvaluation.Thenetinterestonthenetdefinedbenefitliability/assetisthechangeduringtheperiodinthedefinedbenefitliability/assetthatarisesfromthepassageoftime.

Pastservicecostrepresentsthechangeinthepresentvalueofthedefinedbenefitobligationresultingfromaplanamendmentorcurtailment.Pastservicecostsfromplanamendmentsthatincreaseordecreasevestedorunvested


benefitsarerecognizedimmediatelyinnetincomeattheearlierofwhentherelatedplanamendmentoccursorwhentheentityrecognizesrelatedrestructuringcostsorterminationbenefits.

Gainsorlossesonplansettlementsaremeasuredasthedifferenceinthepresentvalueofthedefinedbenefitobligationandsettlementprice.Thisresultsinagainorlossbeingrecognizedwhenthebenefitobligationsettles.Actuarialgainsandlossesarerecordedontheconsolidatedbalancesheetsaspartofthebenefitplan'sfundedstatus.Gainsandlossesarerecognizedimmediatelyinothercomprehensiveincomeandaresubsequentlytransferredtoretainedearningsandarenotsubsequentlyrecognizedinnetincome.

O) ContingentLiabilitiesandOtherProvisions

Provisionsarerecognizedwhenapresentobligationexists(legalorconstructive),asaresultofapastevent,forwhichitisprobablethatanoutflowofresourceswillberequiredtosettletheobligation,andareliableestimatecanbemadeoftheamountoftheobligation.Theamountrecognizedasaprovisionisthebestestimateoftheexpenditurerequiredtosettletheobligationattheconsolidatedbalancesheetdate,measuredusingtheexpectedcashflowsdiscountedforthetimevalueofmoney.Theincreaseinprovision(accretion)duetothepassageoftimeisrecognizedasafinancecostintheconsolidatedstatementsofincome.

Contingentliabilitiesarepossibleobligationswhoseexistencewillbeconfirmedonlyontheoccurrenceornon-occurrenceofuncertainfutureeventsoutsidetheentity'scontrol,orpresentobligationsthatarenotrecognizedbecauseitisnotprobablethatanoutflowofeconomicbenefitswouldberequiredtosettletheobligationortheamountcannotbemeasuredreliably.Contingentliabilitiesarenotrecognizedbutaredisclosedanddescribedinthenotestotheconsolidatedfinancialstatements,includinganestimateoftheirpotentialfinancialeffectanduncertaintiesrelatingtotheamountortimingofanyoutflow,unlessthepossibilityofsettlementisremote.InassessinglosscontingenciesrelatedtolegalproceedingsthatarependingagainsttheCompanyorunassertedclaimsthatmayresultinsuchproceedings,theCompany,withassistancefromitslegalcounsel,evaluatestheperceivedmeritsofanylegalproceedingsorunassertedclaimsaswellastheperceivedmeritsoftheamountofreliefsoughtorexpectedtobesought.

P) Stock-basedCompensation

TheCompanyoffersequity-settledawards(theemployeestockoptionplan,incentivesharepurchaseplanandRestrictedShareUnitplan)tocertainemployees,officersanddirectorsoftheCompany.

Employee Stock Option Plan ("ESOP")

TheCompany'sESOPprovidesforthegrantingofoptionstodirectors,officers,employeesandserviceproviderstopurchasecommonshares.Optionshaveexercisepricesequaltothemarketpriceonthedaypriortothedateofgrant.Thefairvalueoftheseoptionsisrecognizedintheconsolidatedstatementsofincomeandcomprehensiveincomeorintheconsolidatedbalancesheetsifcapitalizedaspartofproperty,plantandminedevelopmentovertheapplicablevestingperiodasacompensationcost.Anyconsiderationpaidbyemployeesonexerciseofoptionsorpurchaseofcommonsharesiscreditedtosharecapital.

FairvalueisdeterminedusingtheBlack-Scholesoptionvaluationmodel,whichrequirestheCompanytoestimatetheexpectedvolatilityoftheCompany'ssharepriceandtheexpectedlifeofthestockoptions.Limitationswithexistingoptionvaluationmodelsandtheinherentdifficultiesassociatedwithestimatingthesevariablescreatedifficultiesindeterminingareliablesinglemeasureofthefairvalueofstockoptiongrants.Thecostisrecordedoverthevestingperiodoftheawardtothesameexpensecategoryoftheawardrecipient'spayrollcostsandthecorrespondingentryisrecordedinequity.Equity-settledawardsarenotremeasuredsubsequenttotheinitialgrantdate.ThedilutiveimpactofstockoptiongrantsisfactoredintotheCompany'sreporteddilutednetincomeper


share.Thestockoptionexpenseincorporatesanexpectedforfeiturerate,estimatedbasedonexpectedemployeeturnover.

Incentive Share Purchase Plan ("ISPP")

UndertheISPP,directors(excludingnon-executivedirectors),officersandemployees(theparticipants)oftheCompanymaycontributeupto10.0%oftheirbasicannualsalariesandtheCompanycontributesanamountequalto50.0%ofeachparticipant'scontribution.AllcommonsharessubscribedforundertheISPPareissuedbytheCompany.

TheCompanyrecordsanexpenseequaltoitscashcontributiontotheISPP.Noforfeiturerateisappliedtotheamountsaccrued.Whereanemployeeleavespriortothevestingdate,anyaccrualforcontributionsbytheCompanyduringthevestingperiodrelatedtothatemployeeisreversed.

Restricted Share Unit ("RSU") Plan

TheRSUplanisopentodirectorsandcertainemployeesincludingseniorexecutivesoftheCompany.Commonsharesarepurchasedandheldinatrustuntiltheyhavevested.Thecostisrecordedoverthevestingperiodoftheawardtothesameexpensecategoryastheawardrecipient'spayrollcosts.ThecostoftheRSUsisrecordedwithinequityuntilsettled.Equity-settledawardsarenotremeasuredsubsequenttotheinitialgrantdate.

Q) RevenueRecognition

Revenuefromminingoperationsconsistsofgoldrevenues,netofsmelting,refining,transportationandothermarketingcharges.Revenuesfromby-productmetalsalesareshownnetofsmelterchargesaspartofrevenuesfromminingoperations.

Revenuefromthesaleofgoldandsilverisrecognizedwhenthefollowingconditionshavebeenmet:

• TheCompanyhastransferredtothebuyerthesignificantrisksandrewardsofownership;

• TheCompanyretainsneithercontinuingmanagerialinvolvementtothedegreeusuallyassociatedwithownershipnoreffectivecontroloverthegoodssold;

• Theamountofrevenuecanbemeasuredreliably;

• ItisprobablethattheeconomicbenefitsassociatedwiththetransactionwillflowtotheCompany;and

• Thecostsincurredortobeincurredinrespectofthetransactioncanbemeasuredreliably.

Revenuefromgoldandsilverintheformofdorebarsisrecordedwhentherefinedgoldorsilverissoldanddeliveredtothecustomer.Generally,allofthegoldandsilverintheformofdorebarsrecoveredintheCompany'smillingprocessissoldintheperiodinwhichitisproduced.

UnderthetermsoftheCompany'sconcentratesalescontractswiththird-partysmelters,finalpricesforthemetalscontainedintheconcentratearedeterminedbasedontheprevailingspotmarketmetalpricesonaspecifiedfuturedate,whichisestablishedasofthedatethattheconcentrateisdeliveredtothesmelter.TheCompanyrecordsrevenuesunderthesecontractsbasedonforwardpricesatthetimeofdelivery,whichiswhentherisksandrewardsofownershipoftheconcentratepassestothethird-partysmelters.Thetermsofthecontractsresultindifferencesbetweentherecordedestimatedpriceatdeliveryandthefinalsettlementprice.Thesedifferencesareadjustedthroughrevenueateachsubsequentfinancialstatementdate.


R) ExplorationandEvaluationExpenditures

Explorationandevaluationexpendituresarethecostsincurredintheinitialsearchformineraldepositswitheconomicpotentialorintheprocessofobtainingmoreinformationaboutexistingmineraldeposits.Explorationexpenditurestypicallyincludecostsassociatedwithprospecting,sampling,mapping,diamonddrillingandotherworkinvolvedinsearchingforore.Evaluationexpendituresarethecostsincurredtoestablishthetechnicalandcommercialviabilityofdevelopingmineraldepositsidentifiedthroughexplorationactivitiesorbyacquisition.

Explorationandevaluationexpendituresareexpensedasincurredunlessitcanbedemonstratedthattheprojectwillgeneratefutureeconomicbenefit.Whenitisdeterminedthataprojectcangeneratefutureeconomicbenefitthecostsarecapitalizedintheproperty,plantandminedevelopmentlineitemoftheconsolidatedbalancesheets.

Theexplorationandevaluationphaseendswhenthetechnicalfeasibilityandcommercialviabilityofextractingthemineralisdemonstrable.

S) NetIncomePerShare

Basicnetincomepershareiscalculatedbydividingnetincomeforagivenperiodbytheweightedaveragenumberofcommonsharesoutstandingduringthatsameperiod.Dilutednetincomepersharereflectsthepotentialdilutionthatcouldoccurifholderswithrightstoconvertinstrumentstocommonsharesexercisetheserights.Convertibledebtisdilutivewheneveritsimpactonnetincome,includingmark-to-marketgains(losses),interestandtaxexpense,perordinaryshareobtainableonconversionislessthanbasicnetincomepershare.Theweightedaveragenumberofcommonsharesusedtodeterminedilutednetincomepershareincludesanadjustment,usingthetreasurystockmethod,forstockoptionsoutstanding.Underthetreasurystockmethod:

• Theexerciseofoptionsisassumedtooccuratthebeginningoftheperiod(ordateofissuance,iflater);

• Theproceedsfromtheexerciseofoptionsplusthefutureperiodcompensationexpenseonoptionsgrantedareassumedtobeusedtopurchasecommonsharesattheaveragemarketpriceduringtheperiod;and

• Theincrementalnumberofcommonshares(thedifferencebetweenthenumberofsharesassumedissuedandthenumberofsharesassumedpurchased)isincludedinthedenominatorofthedilutednetincomepersharecalculation.

T) IncomeTaxes

Currenttaxanddeferredtaxexpensesarerecognizedintheconsolidatedstatementsofincomeexcepttotheextentthattheyrelatetoabusinesscombination,ortoitemsrecognizeddirectlyinequityorinothercomprehensiveincome(loss).

Currenttaxexpenseisbasedonsubstantivelyenactedstatutorytaxratesandlawsattheconsolidatedbalancesheetdate.

Deferredtaxisrecognizedinrespectoftemporarydifferencesbetweenthecarryingamountsofassetsandliabilitiesforfinancialreportingpurposesandthetaxbasisofsuchassetsandliabilitiesmeasuredusingtaxratesandlawsthataresubstantivelyenactedattheconsolidatedbalancesheetdateandeffectiveforthereportingperiodwhenthetemporarydifferencesareexpectedtoreverse.

Deferredtaxesarenotrecognizedinthefollowingcircumstances:

• Wherethedeferredtaxliabilityarisesfromtheinitialrecognitionofgoodwill;


• Wherethedeferredtaxassetorliabilityarisesontheinitialrecognitionofanassetorliabilityinanacquisitionthatisnotabusinesscombinationand,atthetimeoftheacquisition,affectsneithernetincomenorincomebeforeincomeandminingtaxes;and

• FortemporarydifferencesrelatingtoinvestmentsinsubsidiariesandjointlycontrolledentitiestotheextentthattheCompanycancontrolthetimingofthetemporarydifferenceanditisprobablethattheywillnotreverseintheforeseeablefuture.

Deferredtaxassetsarerecognizedforunusedlossescarriedforwardanddeductibletemporarydifferencestotheextentthatitisprobablethatfuturetaxablenetincomewillbeavailableagainstwhichtheycanbeutilizedexceptasnotedabove.

Ateachreportingperiod,previouslyunrecognizeddeferredtaxassetsarereassessedtodeterminewhetherithasbecomeprobablethatfuturetaxablenetincomewillallowthedeferredtaxassetstoberecovered.

Recently Issued Accounting Pronouncements

IFRS9–FinancialInstruments

InJuly2014,theIASBissuedIFRS9–Financial Instruments whichbringstogethertheclassificationandmeasurement,impairmentandhedgeaccountingphasesoftheIASB'sprojecttoreplaceIAS39–Financial Instruments: Recognition and Measurement .ApplicationofthestandardismandatoryforannualperiodsbeginningonorafterJanuary1,2018,withearlyadoptionpermitted.AgnicoEagleisevaluatingtheimpactoftheadoptionofIFRS9ontheCompany'sconsolidatedfinancialstatementsalongwiththetimingofadoption.

IFRS15–RevenuefromContractswithCustomers

InMay2014,theIASBissuedIFRS15–Revenue from Contracts with Customers ,whichestablishesprinciplesthatanentityshallapplytoreportusefulinformationtousersoffinancialstatementsaboutthenature,amount,timing,anduncertaintyofrevenueandcashflowsarisingfromacontractwithacustomer.ApplicationofthestandardismandatoryforannualreportingperiodsbeginningonorafterJanuary1,2018,withearlieradoptionpermitted.AgnicoEagleisevaluatingtheimpactoftheadoptionofIFRS15ontheCompany'sconsolidatedfinancialstatementsalongwiththetimingofadoption.

IFRS16–Leases

InJanuary2016,theIASBissuedIFRS16–Leases whichbringsmostleaseson-balancesheetforlesseesbyeliminatingthedistinctionbetweenoperatingandfinanceleases.Lessoraccountingremainslargelyunchangedandthedistinctionbetweenoperatingandfinanceleasesisretained.UnderIFRS16,alesseerecognizesaright-of-useassetandaleaseliability.Theright-of-useassetistreatedsimilarlytoothernon-financialassetsanddepreciatedaccordingly,andtheliabilityaccruesinterest.Theleaseliabilityisinitiallymeasuredatthepresentvalueoftheleasepaymentspayableovertheleaseterm,discountedattherateimplicitinthelease.Lesseesarepermittedtomakeanaccountingpolicyelection,byclassofunderlyingasset,toapplyamethodlikeIAS17'soperatingleaseaccountingandnotrecognizeleaseassetsandleaseliabilitiesforleaseswithaleasetermof12monthsorlessandonalease-by-leasebasis,toapplyamethodsimilartocurrentoperatingleaseaccountingtoleasesforwhichtheunderlyingassetisoflowvalue.IFRS16supersedesIAS17–Leases andrelatedinterpretationsandiseffectiveforperiodsbeginningonorafterJanuary1,2019,withearlieradoptionpermittedifIFRS15hasalsobeenapplied.AgnicoEagleiscurrentlyevaluatingtheimpactoftheadoptionofIFRS16ontheCompany'sconsolidatedfinancialstatementsalongwiththetimingofadoption.



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)(thousands of United States dollars, except share and per share amounts, unless otherwise indicated) December 31, 2015

4. SIGNIFICANT JUDGMENTS, ESTIMATES AND ASSUMPTIONS

ThepreparationoftheseconsolidatedfinancialstatementsinconformitywithIFRSrequiresmanagementtomakejudgments,estimatesandassumptionsthataffecttheamountsreportedintheconsolidatedfinancialstatementsandaccompanyingnotes.Managementbelievesthattheestimatesusedinthepreparationoftheconsolidatedfinancialstatementsarereasonable;however,actualresultsmaydiffermateriallyfromtheseestimates.Thekeyareaswheresignificantjudgments,estimatesandassumptionshavebeenmadearesummarizedbelow.

ProvenandProbableMineralReserves

ProvenandprobablemineralreservesareestimatesoftheamountoforethatcanbeeconomicallyandlegallyextractedfromtheCompany'sminingproperties.Theestimatesarebasedoninformationcompiledby"qualifiedpersons"asdefinedundertheCanadianSecuritiesAdministrators'NationalInstrument43-101–Standards of Disclosure for Mineral Projects ("NI43-101").Suchananalysisrelatingtothegeologicalandtechnicaldataonthesize,depth,shapeandgradeoftheorebodyandsuitableproductiontechniquesandrecoveryratesrequirescomplexgeologicaljudgmentstointerpretthedata.Theestimationofrecoverableprovenandprobablemineralreservesisbaseduponfactorssuchasestimatesofcommodityprices,futurecapitalrequirementsandproductioncosts,geologicalassumptionsandjudgmentsmadeinestimatingthesizeandgradeoftheorebodyandforeignexchangerates.

Astheeconomicassumptionsusedmaychangeandasadditionalgeologicalinformationisacquiredduringtheoperationofamine,estimatesofprovenandprobablemineralreservesmaychange.SuchchangesmayimpacttheCompany'sconsolidatedbalancesheetsandconsolidatedstatementsofincomeandcomprehensiveincome,including:

• ThecarryingvalueoftheCompany'sproperty,plantandminedevelopmentandgoodwillmaybeaffectedduetochangesinestimatedfuturecashflows;

• Amortizationchargesintheconsolidatedstatementsofincomeandcomprehensiveincomemaychangewheresuchchargesaredeterminedusingtheunits-of-productionmethodorwheretheusefullifeoftherelatedassetschange;

• Capitalizedstrippingcostsrecognizedintheconsolidatedbalancesheetsaseitherpartofminingpropertiesoraspartofinventoriesorchargedtoincomemaychangeduetochangesintheratiooforetowasteextracted;and

• Reclamationprovisionsmaychangewherechangestotheprovenandprobablemineralreserveestimatesaffectexpectationsaboutwhensuchactivitieswilloccurandtheassociatedcostoftheseactivities.

ExplorationandEvaluationExpenditures

TheapplicationoftheCompany'saccountingpolicyforexplorationandevaluationexpendituresrequiresjudgmenttodeterminewhetherfutureeconomicbenefitsarelikelytoariseandwhetheractivitieshavereachedastagethatpermitsareasonableassessmentoftheexistenceofprovenandprobablemineralreserves.

ProductionStageofaMine

Aseachmineisunique,significantjudgmentisrequiredtodeterminethedatethatamineenterstheproductionstage.TheCompanyconsidersthefactorsoutlinedinnote3totheseconsolidatedfinancialstatementstomakethisdetermination.

Contingencies

Contingenciescanbeeitherpossibleassetsorpossibleliabilitiesarisingfrompasteventswhich,bytheirnature,willberesolvedonlywhenoneormoreuncertainfutureeventsoccurorfailtooccur.Theassessmentoftheexistenceandpotentialimpactofcontingenciesinherentlyinvolvestheexerciseofsignificantjudgmentandtheuseofestimatesregardingtheoutcomeoffutureevents.


ReclamationProvisions

EnvironmentalremediationcostswillbeincurredbytheCompanyattheendoftheoperatinglifeoftheCompany'sminingproperties.Managementassessesitsreclamationprovisioneachreportingperiodorwhennewinformationbecomesavailable.Theultimateenvironmentalremediationcostsareuncertainandcostestimatescanvaryinresponsetomanyfactors,includingestimatesoftheextentandcostsofreclamationactivities,technologicalchanges,regulatorychanges,costincreasesascomparedtotheinflationrateandchangesindiscountrates.Theseuncertaintiesmayresultinfutureactualexpendituresdifferingfromtheamountofthecurrentprovision.Asaresult,therecouldbesignificantadjustmentstotheprovisionsestablishedthatwouldaffectfuturefinancialresults.Thereclamationprovisionasatthereportingdaterepresentsmanagement'sbestestimateofthepresentvalueofthefutureenvironmentalremediationcostsrequired.

IncomeandMiningTaxes

Managementisrequiredtomakeestimatesregardingthetaxbasisofassetsandliabilitiesandrelateddeferredincomeandminingtaxassetsandliabilities,amountsrecordedforuncertaintaxpositions,themeasurementofincomeandminingtaxexpense,andestimatesofthetimingofrepatriationofincome.Severaloftheseestimatesrequiremanagementtomakeassessmentsoffuturetaxableprofitand,ifactualresultsaresignificantlydifferentthantheCompany'sestimates,theabilitytorealizethedeferredincomeandminingtaxassetsrecordedontheconsolidatedbalancesheetscouldbeaffected.

ImpairmentofGoodwillandNon-currentAssets

TheCompanyevaluateseachassetorCGU(excludinggoodwill,whichisassessedannuallyregardlessofindicators)ineachreportingperiodtodetermineifanyindicatorsofimpairmentexist.Whencompletinganimpairmenttest,theCompanycalculatestheestimatedrecoverableamountofCGUs,whichrequiresmanagementtomakeestimatesandassumptionswithrespecttoitemssuchasfutureproductionlevels,operatingandcapitalcosts,long-termcommodityprices,foreignexchangerates,discountrates,explorationpotential,andclosureandenvironmentalremediationcosts.Theseestimatesandassumptionsaresubjecttoriskanduncertainty.Therefore,thereisapossibilitythatchangesincircumstanceswillhaveanimpactontheseprojections,whichmayimpacttherecoverableamountofassetsorCGUs.Accordingly,itispossiblethatsomeortheentirecarryingamountoftheassetsorCGUsmaybefurtherimpairedortheimpairmentchargereducedwiththeimpactrecognizedintheconsolidatedstatementsofincomeandcomprehensiveincome.

JointArrangements

JudgmentisrequiredtodeterminewhentheCompanyhasjointcontrolofacontractualarrangement,whichrequiresacontinuousassessmentoftherelevantactivitiesandwhenthedecisionsinrelationtothoseactivitiesrequireunanimousconsent.Judgmentisalsocontinuallyrequiredtoclassifyajointarrangementaseitherajointoperationorajointventurewhenthearrangementhasbeenstructuredthroughaseparatevehicle.ClassifyingthearrangementrequirestheCompanytoassessitsrightsandobligationsarisingfromthearrangement.Specifically,theCompanyconsidersthelegalformoftheseparatevehicle,thetermsofthecontractualarrangementandotherrelevantfactsandcircumstances.Thisassessmentoftenrequiressignificantjudgment,andadifferentconclusiononjointcontrol,orwhetherthearrangementisajointoperationorajointventure,mayhaveamaterialimpactontheaccountingtreatment.

ManagementevaluateditsjointarrangementwithYamanaGoldInc.("Yamana")toeachacquire50.0%ofthesharesofOsisko(nowCanadianMalarticCorporation)undertheprinciplesofIFRS11Joint Arrangements .TheCompanyconcludedthatthearrangementqualifiedasajointoperationuponconsideringthefollowingsignificantfactors:

• Therequirementthatthejointoperatorspurchasealloutputfromtheinvesteeandinvesteerestrictionsonsellingtheoutputtoanythirdparty;


• Thepartiestothearrangementaresubstantiallytheonlysourceofcashflowcontributingtothecontinuityofthearrangement;and

• Ifthesellingpricedropsbelowcost,thejointoperatorsarerequiredtocoveranyobligationstheentitycannotsatisfy.

5. ACQUISITIONS

GunnarnMiningAB

OnJune11,2015,AgnicoEagleSwedenAB("AESweden")anindirectwholly-ownedsubsidiaryoftheCompany,acquired55.0%oftheissuedandoutstandingcommonsharesofGunnarnMiningAB("Gunnarn")fromOrexMineralsInc.("Orex"),bywayofasharepurchaseagreement(the"GunnarnSPA").TheoperationandgovernanceofGunnarnandtheBarseleprojectaregovernedbyajointventureagreementamongtheCompany,AESweden,OrexandGunnarn(the"GunnarnJVA").

UndertheGunnarnSPA,theconsiderationfortheacquisitionofthe55.0%ofGunnarn'soutstandingcommonshareswas$10.0million,comprisedof$6.0millionincashpayableatclosingandpaymentsof$2.0millionincashor,atAESweden'ssolediscretion,sharesoftheCompanyoneachofthefirstandsecondanniversaryoftheclosing.UndertheGunnarnJVA,AESwedencommittedtoincuranaggregateof$7.0millionofexplorationexpensesattheBarseleprojectbyJune11,2018,45.0%or$3.1millionofwhichisconsideredaccruedpurchaseconsideration.Accordingly,theCompany'stotalpurchaseconsiderationfortheacquisitionofits55.0%interestinGunnarnwas$13.1million.AESwedenmayearnanadditional15.0%interestinGunnarnundertheGunnarnJVAifitcompletesafeasibilitystudyinrespectoftheBarseleproject.

TheGunnarnJVAalsoprovidesAESwedenwiththerighttonominateamajorityofthemembersoftheboardofdirectorsofGunnarn(basedoncurrentshareholdings)andAESwedenisthesoleoperatoroftheBarseleprojectandpaidcustomarymanagementfees.

Inconnectionwiththetransaction,Orexalsoobtaineda2.0%netsmelterreturnroyaltyonproductionfromtheBarseleproperty,whichtheCompanymayrepurchaseatanytimefor$5.0million.

TheGunnarnacquisitionwasaccountedforbytheCompanyasanassetacquisitionandtransactioncostsassociatedwiththeacquisitiontotaling$0.6millionwerecapitalizedtotheminingpropertiesacquired.


Thefollowingtablesetsouttheallocationofthepurchasepricetoassetsacquiredandliabilitiesassumed,basedonmanagement'sestimatesoffairvalue:

Total purchase price:

Cashpaidforacquisition $ 5,994

Accruedconsideration 7,150

Totalpurchasepricetoallocate $ 13,144

Fair value of assets acquired and liabilities assumed:

Miningproperties $ 20,021

Cashandcashequivalents 3

Othercurrentassets 35

Accountspayableandaccruedliabilities (80)

Long-termdebt (29)

Otherliabilities (6,806)

Netassetsacquired $ 13,144

SoltoroLtd.

OnJune9,2015,theCompanyacquiredalloftheissuedandoutstandingcommonsharesofSoltoroLtd.("Soltoro"),includingcommonsharesissuableontheexerciseofSoltoro'soutstandingoptionsandwarrants,bywayofaplanofarrangementundertheCanada Business CorporationsAct (the"SoltoroArrangement").Atthetimeofitsacquisition,SoltorowasaTSXVenturelistedexplorationcompanyfocusedonthediscoveryofpreciousmetalsinMexico.

EachoutstandingshareofSoltorowasexchangedundertheSoltoroArrangementfor:(i)C$0.01incash;(ii)0.00793ofanAgnicoEaglecommonshare;and(iii)onecommonshareofPalaminaCorp.,acompanythatwasnewlyformedinconnectionwiththeSoltoroArrangement.

PursuanttotheSoltoroArrangement,SoltorotransferredallminingpropertieslocatedoutsideofthestateofJalisco,MexicotoPalaminaCorp.,andretainedallminingpropertieslocatedwithinthestateofJalisco,Mexico.AgnicoEaglehadnointerestinPalaminaCorp.upontheclosingoftheSoltoroArrangement.

AgnicoEagle'stotalpurchasepriceof$26.7millionwascomprisedof$2.4millionincash,including$1.6millionincashcontributedtoPalaminaCorp.,and770,429AgnicoEaglecommonsharesissuedfromtreasury.TheSoltoroacquisitionwasaccountedforasanassetacquisitionandtransactioncostsassociatedwiththeacquisitiontotaling$1.4millionwerecapitalizedtotheminingpropertiesacquiredseparatelyfromthepurchasepriceallocationsetoutbelow.





AgnicoEaglecommonsharesissuedforacquisition 24,351




Cashandcashequivalents 2,375

Available-for-salesecurities 17


Plantandequipment 33

Accountspayableandaccruedliabilities (1,134)

Othercurrentliabilities (1,757)


MalarticCHLProperty

OnMarch19,2015,AgnicoEagle,YamanaandCanadianMalarticGPcompletedthepurchaseofa30.0%interestintheMalarticCHLpropertyfromAbitibiRoyaltiesInc.("Abitibi")inexchangefor459,197AgnicoEaglecommonshares,3,549,695Yamanacommonsharesand3.0%netsmelterreturnroyaltiestoeachofAbitibiandOsiskoGoldRoyaltiesLtd.ontheMalarticCHLproperty.TotalAgnicoEaglecommonshareconsiderationissuedwasvaluedat$13.4millionbasedontheclosingpriceofthecommonsharesonMarch18,2015.TheMalarticCHLpropertyislocatedadjacenttotheCompany'sjointlyownedCanadianMalarticmineandtheremaining70.0%interestintheMalarticCHLpropertywasjointlyacquiredthroughtheJune16,2014acquisitionofOsisko(thepredecessortoCanadianMalarticCorporation).Concurrentwiththetransactionclosing,eachofAbitibi,AgnicoEagle,Yamana,CanadianMalarticGPandCanadianMalarticCorporationreleasedanddischargedtheotherswithrespecttoallproceedingspreviouslycommencedbyAbitibiwithrespecttotheMalarticCHLproperty.Asaresultofthetransaction,AgnicoEagleandYamanajointlyowna100%interestintheMalarticCHLpropertythroughtheirrespectiveindirectinterestsinCanadianMalarticGP.

CaydenResourcesInc.

OnNovember28,2014,theCompanyacquiredalloftheissuedandoutstandingcommonsharesofCaydenResourcesInc.("Cayden"),includingcommonsharesissuedontheexerciseofCayden'sthenoutstandingoptionsandwarrants,pursuanttoacourt-approvedplanofarrangementundertheBusiness Corporations Act (BritishColumbia).Atthetimeofitsacquisition,CaydenwasaTSXVenturelistedexplorationcompanyfocusedonthediscoveryofpreciousmetalsinMexico.

Thetotalpurchasepriceof$122.1millionwascomprisedof$0.5millionincashand4,853,875AgnicoEaglecommonsharesissuedfromtreasury.TheCaydenacquisitionwasaccountedforasanassetacquisitionandtransactioncostsassociatedwiththeacquisitiontotaling$3.2millionwerecapitalizedtotheminingpropertiesacquired.




Cashpaidforacquisition $ 476

AgnicoEaglecommonsharesissuedforacquisition 121,655




Cashandcashequivalents 3,953

Tradereceivables 141

Incometaxesrecoverable 1,942


Plantandequipment 68

Accountspayableandaccruedliabilities (1,280)


OsiskoMiningCorporation

OnJune16,2014,AgnicoEagleandYamanajointlyacquired100.0%oftheissuedandoutstandingsharesofOsiskobywayofacourt-approvedplanofarrangement(the"OsiskoArrangement")undertheCanada Business Corporations Act .UndertheOsiskoArrangement,AgnicoEagleandYamanaeachindirectlyacquired50.0%ofOsisko'sissuedandoutstandingshares.AspartoftheOsiskoArrangement,theCanadianMalarticmineinQuebecwastransferredtothenewlyformedCanadianMalarticGPinwhicheachofAgnicoEagleandYamanahaveanindirect50.0%interest.AgnicoEagleandYamanawillalsojointlyexploretheKirklandLakeassets,theHammondReefprojectandthePandoraandWood-PandorapropertiesthroughtheirindirectjointownershipofCanadianMalarticCorporation(thesuccessortoOsisko).Together,theacquiredpropertiesconstitutetheCanadianMalarticjointoperationsegment(seenote22totheseconsolidatedfinancialstatementsfordetails).

EachoutstandingshareofOsiskowasexchangedundertheOsiskoArrangementfor:(i)C$2.09incash(AgnicoEagle's50.0%sharewasC$1.045);(ii)0.07264ofanAgnicoEaglecommonshare(avalueofC$2.64basedontheclosingpriceofC$36.29forAgnicoEaglecommonsharesontheTorontoStockExchangeasofJune16,2014);(iii)0.26471ofaYamanacommonshare;and(iv)0.1ofonecommonshareofOsiskoGoldRoyaltiesLtd.,acompanythatwasnewlyformedinconnectionwiththeOsiskoArrangementthatisnowtradedontheTorontoStockExchange.

PursuanttotheOsiskoArrangement,thefollowingassetsofOsiskoweretransferredtoOsiskoGoldRoyaltiesLtd.:(i)a5.0%netsmelterroyaltyontheCanadianMalarticmine;(ii)C$157.0millionincash;(iii)a2.0%netsmelterroyaltyontheKirklandLakeassets,theHammondReefproject,andcertainotherexplorationpropertiesretainedbyCanadianMalarticCorporation;(iv)allassetsandliabilitiesofOsiskoinitsGuerrerocampinMexico;and(v)certainotherinvestmentsandassets.


AgnicoEaglehasrecognizeditsinterestintheassets,liabilities,revenuesandexpensesofOsiskoinaccordancewiththeCompany'srightsandobligationsprescribedbytheOsiskoArrangement,asthejointarrangementwasdeterminedtobeajointoperationunderIFRS.

AgnicoEagle'stransactioncostsassociatedwiththeacquisitiontotaling$16.7millionwereexpensedthroughthegeneralandadministrativelineitemoftheannualauditedconsolidatedstatementsofincomeandcomprehensiveincomefortheyearendedDecember31,2014.

AgnicoEagle'sshareoftheJune16,2014purchasepriceofOsiskowascomprisedofthefollowing:


AgnicoEaglecommonsharesissuedforacquisition 1,135,071

TotalAgnicoEaglepurchasepricetoallocate $ 1,597,799

AfairvalueapproachwasappliedbymanagementindevelopingestimatesofthefairvalueofidentifiableassetsandliabilitiescontributedtothenewlyformedOsiskojointoperation.Theseestimatesoffairvaluehavenowbeenfinalizedasallrelevantinformationaboutfactsandcircumstancesthatexistedattheacquisitiondatehavebeenreceived.

CertainpreviouslyreportedAgnicoEagleconsolidatedbalancesheetlineitemsasatDecember31,2014wereupdatedtoreflectadjustedfinalestimatesofthefairvalueofidentifiableassetsacquiredandliabilitiesassumedrelatedtotheJune16,2014jointacquisitionofOsisko.AsaresultofnewinformationobtainedaboutthefactsandcircumstancesthatexistedasoftheOsiskoacquisitiondate,thefollowingadjustmentswererecordedtoboththeadjustedfinalpurchasepriceallocationandtheDecember31,2014balancesheetaspreviouslyreported:theproperty,plantandminedevelopmentlineitemdecreasedby$145.6million;thegoodwilllineitem(notdeductiblefortaxpurposes)increasedby$114.3million;theaccountspayableandaccruedliabilitieslineitemincreasedby$3.7millionandthedeferredincomeandminingtaxliabilitieslineitemdecreasedby$35.0million.


ThefollowingtablesetsouttheallocationofAgnicoEagle'sshareofthepurchasepricetoattributableassetsacquiredandliabilitiesassumedpursuanttotheOsiskoArrangement,basedonmanagement'spreviouslyreportedpreliminaryestimatesoffairvalueandadjustedfinalestimatesoffairvalue:


Preliminary (i)

Adjustments

Adjusted Final

Property,plantandminedevelopment $ 1,452,148 $ (145,631) $ 1,306,517

Goodwill(ii) 543,444 114,348 657,792

Cashandcashequivalents 59,219 – 59,219

Restrictedcash 35,528 – 35,528

Tradereceivables(iii) 9,653 – 9,653

Inventories 51,477 – 51,477

Othercurrentassets 11,420 – 11,420

Accountspayableandaccruedliabilities (49,391) (3,726) (53,117)

Reclamationprovision (20,776) – (20,776)

Long-termdebt (151,333) – (151,333)

Deferredincomeandminingtaxliabilities (343,590) 35,009 (308,581)

Netassetsacquired $ 1,597,799 $ – $ 1,597,799

Notes:

(i) PreliminaryestimatesofthefairvalueofassetsacquiredandliabilitiesassumedarepresentedasreportedintheCompany's2014annualauditedconsolidatedfinancialstatements.

(ii) GoodwillisnotdeductiblefortaxpurposesandisallocatedtotheCanadianMalarticjointoperationsegment.

(iii) Thefairvalueoftradereceivablesapproximatesthegrosscontractualamountsreceivable.

ThejointacquisitionofOsiskowasastrategicfitwiththeCompany'sskillsetanditsotheroperatingassetsinthearea.TheCompanybelievesthatgoodwillassociatedwiththejointacquisitionofOsiskoaroseprincipallybecauseofthefollowingfactors:(1)thevalueimplicitintheCompany'sabilitytosustainand/orgrowitsbusinessbyincreasingprovenandprobablemineralreservesandmineralresourcesthroughnewdiscoveries;and(2)therequirementtorecordadeferredtaxliabilityforthedifferencebetweentheassignedvaluesandthetaxbasesofassetsacquiredandliabilitiesassumedinabusinesscombinationatamountsthatdonotreflectfairvalue.TheamountofgoodwillassociatedwiththejointacquisitionofOsiskothatisexpectedtobedeductiblefortaxpurposesisnil.Uponfinalizationofmanagement'sestimatesofthefairvalueofidentifiableassetsandliabilities,theCompanyconductedaretrospectivegoodwillimpairmenttestasatDecember31,2014basedontheadjustedfinalvalueofgoodwill,withnoimpairmentlossesrequired.

TheCompany'sindirect50.0%interestinCanadianMalarticGPresultedinrevenuesfromminingoperationsof$189.9millionandanetlossof$15.8millionbetweentheJune16,2014completionoftheOsiskoArrangementandDecember31,2014.


6. FAIR VALUE MEASUREMENT

Fairvalueisthepricethatwouldbereceivedtosellanassetorpaidtotransferaliabilityinanorderlytransactionbetweenmarketparticipantsatthemeasurementdate.Allassetsandliabilitiesforwhichfairvalueismeasuredordisclosedintheconsolidatedfinancialstatementsarecategorizedwithinthefairvaluehierarchy,described,asfollows,basedonthelowest-levelinputthatissignificanttothefairvaluemeasurementasawhole:

Level1–Unadjustedquotedpricesinactivemarketsthatareaccessibleatthemeasurementdateforidentical,unrestrictedassetsorliabilities;

Level2–Quotedpricesinmarketsthatarenotactiveorinputsthatareobservable,eitherdirectlyorindirectly,forsubstantiallythefulltermoftheassetorliability;and

Level3–Pricesorvaluationtechniquesthatrequireinputsthatarebothsignificanttothefairvaluemeasurementandunobservable(supportedbylittleornomarketactivity).

ThefairvaluehierarchygivesthehighestprioritytoLevel1inputsandthelowestprioritytoLevel3inputs.

Foritemsthatarerecognizedatfairvalueonarecurringbasis,theCompanydetermineswhethertransfershaveoccurredbetweenlevelsinthehierarchybyreassessingtheirclassificationattheendofeachreportingperiod.

DuringtheyearendedDecember31,2015,therewerenotransfersbetweenLevel1andLevel2fairvaluemeasurements,andnotransfersintooroutofLevel3fairvaluemeasurements.

TheCompany'sfinancialassetsandliabilitiesincludecashandcashequivalents,short-terminvestments,restrictedcash,tradereceivables,available-for-salesecurities,accountspayableandaccruedliabilities,long-termdebtandderivativefinancialinstruments.

Thefairvaluesofcashandcashequivalents,short-terminvestments,restrictedcashandaccountspayableandaccruedliabilitiesapproximatetheircarryingvaluesduetotheirshort-termnature.

Long-termdebtisrecordedontheconsolidatedbalancesheetsatDecember31,2015atamortizedcost.Thefairvalueoflong-termdebtisdeterminedbyapplyingadiscountrate,reflectingthecreditspreadbasedontheCompany'screditrating,tofuturerelatedcashflowswhichiscategorizedwithinLevel2ofthefairvaluehierarchy.AsatDecember31,2015,theCompany'slong-termdebthadafairvalueof$1,226.5million(December31,2014–$1,498.4million).

ThefollowingtablesetsouttheCompany'sfinancialassetsandliabilitiesmeasuredatfairvalueonarecurringbasisasatDecember31,2015usingthefairvaluehierarchy:

Level 1 Level 2 Level 3 Total Financial assets:

Tradereceivables $ – $ 7,714 $ – $ 7,714

Available-for-salesecurities 27,630 4,233 – 31,863

Fairvalueofderivativefinancialinstruments – 87 – 87

Totalfinancialassets $ 27,630 $ 12,034 $ – $ 39,664

Financial liabilities:

Fairvalueofderivativefinancialinstruments $ – $ 8,073 $ – $ 8,073

Totalfinancialliabilities $ – $ 8,073 $ – $ 8,073


ThefollowingtablesetsouttheCompany'sfinancialassetsandliabilitiesmeasuredatfairvalueonarecurringbasisasatDecember31,2014usingthefairvaluehierarchy:

Level 1 Level 2 Level 3 Total Financial assets:

Tradereceivables $ – $ 59,716 $ – $ 59,716

Available-for-salesecurities 51,653 4,815 – 56,468

Fairvalueofderivativefinancialinstruments – 4,877 – 4,877

Totalfinancialassets $ 51,653 $ 69,408 $ – $ 121,061

Financial liabilities:

CMGPConvertibleDebentures $ – $ – $ 34,678 $ 34,678

Fairvalueofderivativefinancialinstruments – 8,249 – 8,249

Totalfinancialliabilities $ – $ 8,249 $ 34,678 $ 42,927

Valuation Techniques

TradeReceivables

Tradereceivablesfromprovisionalinvoicesforconcentratesalesarevaluedusingquotedforwardratesderivedfromobservablemarketdatabasedonthemonthofexpectedsettlement(classifiedwithinLevel2ofthefairvaluehierarchy).

Available-for-saleSecurities

Available-for-salesecuritiesrepresentingsharesofpubliclytradedentitiesarerecordedatfairvalueusingquotedmarketprices(classifiedwithinLevel1ofthefairvaluehierarchy).Available-for-salesecuritiesrepresentingsharesofnon-publiclytradedentitiesarerecordedatfairvalueusingexternalbroker-dealerquotationscorroboratedbyoptionpricingmodels(classifiedwithinLevel2ofthefairvaluehierarchy).

DerivativeFinancialInstruments

DerivativefinancialinstrumentsclassifiedwithinLevel2ofthefairvaluehierarchyarerecordedatfairvalueusingexternalbroker-dealerquotationscorroboratedbyoptionpricingmodelsoroptionpricingmodelsthatutilizeavarietyofinputsthatareacombinationofquotedpricesandmarket-corroboratedinputs.Derivativefinancialinstrumentsareclassifiedasatfairvaluethroughtheconsolidatedstatementsofincome.

CMGPConvertibleDebentures

OnJune30,2015,thenegotiatedearlysettlementofalloftheseniorunsecuredconvertibledebenturesissuedbyOsiskoandsubsequentlyanobligationofCanadianMalarticGP(the"CMGPConvertibleDebentures")wascompleted.TheCMGPConvertibleDebentureswerereportedatfairvalueandclassifiedwithinLevel3ofthefairvaluehierarchyandconstitutedcontractswhichresultedinthepaymentofcashandtheissuanceofpublicly-tradedshares.Fairvaluewascalculatedwithconsiderationgiventotheinfluenceofavarietyofinputsincludingquotedmarketpricesandinterestrates.CMGPConvertibleDebentureswereincludedinthecurrentportionoflong-termdebtlineitemoftheconsolidatedbalancesheetspriortosettlement.




7. RESTRICTED CASH

AspartoftheCompany'sinsuranceprogramsfrontedbyathirdpartyproviderandreinsuredthroughtheCompany'sinternalinsuranceprogram,thethirdpartyproviderrequiresthatcashof$0.4millionberestrictedasatDecember31,2015(December31,2014–$5.8million).

AspartoftheCompany'staxplanning,$32.0millionwascontributedtoaqualifiedenvironmentaltrust("QET")inDecember2011tofulfilltherequirementoffinancialsecurityforcostsrelatedtotheenvironmentalremediationoftheGoldexmine.DuringtheyearendedDecember31,2015,$13.1million(2014–$0.1million)waswithdrawnfromtheQET.AsatDecember31,2015,$0.1million(December31,2014–$15.5million)remainedintheQET.

AtDecember31,2015,cashofnil(December31,2014–$11.8million)wasrestrictedrepresenting50.0%ofamountsheldbyadepositarytosatisfyobligationsinconnectionwiththeCMGPConvertibleDebentures.

AsatDecember31,2015,cashof$0.7million(December31,2014–$20.9million)wasrestrictedrepresenting50.0%ofthedepositsinrespectofenvironmentalguaranteesintheProvinceofQuebecmadebyCanadianMalarticGPinconnectionwithitsownershipoftheCanadianMalarticmine.

8. INVENTORIES

As at December 31,

2015

As at December 31,

2014 Oreinstockpilesandonleachpads $ 26,319 $ 51,970

Concentratesanddorebars 170,971 111,912

Supplies 264,686 282,778

Totalcurrentinventories $ 461,976 $ 446,660

Non-currentoreinstockpilesandonleachpads(i) 61,167 25,125

Totalinventories $ 523,143 $ 471,785

Note:

(i) OrethattheCompanydoesnotexpecttoprocesswithin12monthsisclassifiedaslong-termandisrecordedintheotherassetslineitemontheconsolidatedbalancesheets.

DuringtheyearendedDecember31,2015,achargeof$8.6million(2014–$4.6million)wasrecordedwithinproductioncoststoreducethecarryingvalueofinventoriestotheirnetrealizablevalue.


9. AVAILABLE-FOR-SALE SECURITIES

As at December 31,

2015

As at December 31,

2014 Cost $ 64,832 $ 74,928

Accumulatedimpairmentlosses (36,842) (30,090)

Unrealizedgainsinaccumulatedothercomprehensiveincome 4,030 11,815

Unrealizedlossesinaccumulatedothercomprehensiveincome (157) (185)

Totalestimatedfairvalueofavailable-for-salesecurities $ 31,863 $ 56,468

DuringtheyearendedDecember31,2015,theCompanyreceivedproceedsof$54.4million(2014–$41.4million)andrecognizedagainbeforeincometaxesof$24.6million(2014–$5.6million)onthesaleofcertainavailable-for-salesecurities.

DuringtheyearendedDecember31,2015,theCompanyrecordedanimpairmentlossof$12.0million(2014–$15.8million)oncertainavailable-for-salesecuritiesthatweredeterminedtohaveanimpairmentthatwassignificantorprolonged.

10. OTHER ASSETS

(a) OtherCurrentAssets

As at December 31,

2015

As at December 31,

2014

Federal,provincialandothersalestaxesreceivable $ 89,313 $ 70,143

Prepaidexpenses 71,811 39,608

Insurancereceivable 12,288 113

Other 21,277 13,537

Totalothercurrentassets $ 194,689 $ 123,401

(b) OtherAssets

As at December 31,

2015

As at December 31,

2014

Non-currentoreinstockpilesandonleachpads $ 61,167 $ 25,125

Otherassets 6,071 2,497

Totalotherassets $ 67,238 $ 27,622


11. PROPERTY, PLANT AND MINE DEVELOPMENT

Mining

Properties Plant and Equipment

Mine Development

Costs Total

As at December 31, 2013 $ 820,253 $ 1,683,902 $ 1,190,306 $ 3,694,461

Additions 94,081 204,661 208,342 507,084

Disposals (2,526) (6,142) – (8,668)

Acquisitions 1,105,961 111,844 205,958 1,423,763

Amortization (79,363) (290,530) (90,882) (460,775)

Transfersbetweencategories 1,534 305,512 (307,046) –

As at December 31, 2014 1,939,940 2,009,247 1,206,678 5,155,865

Additions 103,664 174,477 283,221 561,362

Disposals (88) (6,269) (1,757) (8,114)

Amortization (168,612) (352,090) (99,444) (620,146)

Transfersbetweencategories (209,294) 239,041 (29,747) –

As at December 31, 2015 $ 1,665,610 $ 2,064,406 $ 1,358,951 $ 5,088,967

As at December 31, 2014:

Cost $ 3,485,005 $ 3,832,709 $ 1,615,431 $ 8,933,145

Accumulatedamortizationandnetimpairments (1,545,065) (1,823,462) (408,753) (3,777,280)

Netcarryingamount–December31,2014 $ 1,939,940 $ 2,009,247 $ 1,206,678 $ 5,155,865

As at December 31, 2015:

Cost $ 3,330,464 $ 4,273,798 $ 1,867,172 $ 9,471,434

Accumulatedamortizationandnetimpairments (1,664,854) (2,209,392) (508,221) (4,382,467)

Netcarryingamount—December31,2015 $ 1,665,610 $ 2,064,406 $ 1,358,951 $ 5,088,967

AsatDecember31,2015,assetsunderconstruction,andthereforenotyetbeingdepreciated,includedinthenetcarryingamountofproperty,plantandminedevelopmentamountedto$350.7million(December31,2014–$270.6million).


GeographicInformation:

As at December 31,

2015

As at December 31,

2014

Northern Business: Canada $ 3,196,494 $ 3,272,656

Finland 851,867 825,292

Southern Business: Mexico 1,030,364 1,047,669

UnitedStates 10,242 10,248

Totalproperty,plantandminedevelopment $ 5,088,967 $ 5,155,865

12. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

As at December 31,

2015

As at December 31,

2014

Tradepayables $ 132,914 $ 92,275

Wagespayable 40,020 37,025

Accruedliabilities 40,252 37,886

Otherliabilities 30,600 42,720

Totalaccountspayableandaccruedliabilities $ 243,786 $ 209,906

In2015and2014,theotherliabilitiesbalanceconsistedprimarilyofvariousemployeepayrolltaxwithholdingsandotherpayrolltaxes.

13. RECLAMATION PROVISION

AgnicoEagle'sreclamationprovisionincludesbothassetretirementobligationsandenvironmentalremediationliabilities.Reclamationprovisionestimatesarebasedoncurrentlegislation,thirdpartyestimates,management'sestimatesandfeasibilitystudycalculations.Assumptionsbasedoncurrenteconomicconditions,whichtheCompanybelievesarereasonable,havebeenusedtoestimatethereclamationprovision.However,actualreclamationcostswillultimatelydependonfutureeconomicconditionsandcostsforthenecessaryreclamationwork.Changesinreclamationprovisionestimatesduringtheperiodreflectchangesincashflowestimatesaswellasassumptionsincludingdiscountandinflationrates.ThediscountratesusedinthecalculationofthereclamationprovisionatDecember31,2015rangedbetween0.48%and2.37%(December31,2014–between1.03%and2.54%).


ThefollowingtablereconcilesthebeginningandendingcarryingamountsoftheCompany'sassetretirementobligations.Thesettlementoftheobligationisestimatedtooccurthroughto2068.


2015


2014

Assetretirementobligations–long-term,beginningofyear $ 242,615 $ 171,472

Assetretirementobligations–current,beginningofyear 2,863 1,029

Currentyearadditionsandchangesinestimate,net 64,305 69,420

CurrentyearattributableadditionsuponjointacquisitionofOsisko – 20,776

Currentyearaccretion 4,178 5,173

Liabilitiessettled (1,496) (1,714)

Foreignexchangerevaluation (38,954) (20,678)

Reclassificationfromlong-termtocurrent,endofyear (4,443) (2,863)

Assetretirementobligations–long-term,endofyear $ 269,068 $ 242,615

ThefollowingtablereconcilesthebeginningandendingcarryingamountsoftheCompany'senvironmentalremediationliability.Thesettlementoftheobligationisestimatedtooccurthroughto2020.


2015


2014

Environmentalremediationliability–long-term,beginningofyear $ 7,302 $ 12,537

Environmentalremediationliability–current,beginningofyear 3,906 2,423

Currentyearadditionsandchangesinestimate,net 180 563

Liabilitiessettled (562) (3,202)

Foreignexchangerevaluation (1,793) (1,113)

Reclassificationfromlong-termtocurrent,endofyear (1,802) (3,906)

Environmentalremediationliability–long-term,endofyear $ 7,231 $ 7,302


14. LEASES

(a) FinanceLeases

TheCompanyhasenteredintosale-leasebackagreementswiththirdpartiesforvariousfixedandmobileequipmentwithinCanada.Thesearrangementsrepresentsale-leasebacktransactionsinaccordancewithIAS17–Leases .Thesale-leasebackagreementshaveanaverageeffectiveannualinterestrateof3.3%andtheaveragelengthofthecontractsisfiveyears.

Allofthesale-leasebackagreementshaveendofleaseclausesthatqualifyasbargainpurchaseoptionsthattheCompanyexpectstoexecute.AsatDecember31,2015,thetotalnetbookvalueofassetsrecordedundersale-leasebackfinanceleasesamountedto$7.1million(December31,2014–$12.9million).

TheCompanyhasagreementswiththirdpartyprovidersofmobileequipment.ThesearrangementsrepresentfinanceleasesinaccordancewiththeguidanceinIAS17–Leases .Theleasesareforfivetosevenyearsandhaveanaverageeffectiveannualinterestrateof4.2%.

AsaresultofitsJune16,2014jointacquisitionofOsisko,AgnicoEagleassumedindirectattributablesecuredfinanceleaseobligationsofC$38.3million($35.3million)providedinseparatetrancheswithmaturitiesrangingbetween2015and2019anda7.5%interestrate.AsatDecember31,2015,theCompany'sattributablefinanceleaseobligationsamountedto$13.7million(December31,2014–$31.7million).

Thefollowingtablesetsoutfutureminimumleasepaymentsunderfinanceleasestogetherwiththepresentvalueofthenetminimumleasepayments:

As at December 31, 2015

As at December 31, 2014

Minimum Finance Lease

Payments Interest Present

Value

Minimum Finance Lease

Payments Interest Present

Value

Within1year $ 10,191 $ 602 $ 9,589 $ 23,587 $ 1,445 $ 22,142

Between1–5years 10,057 510 9,547 22,232 1,095 21,137

Total $ 20,248 $ 1,112 $ 19,136 $ 45,819 $ 2,540 $ 43,279

AsatDecember31,2015,thetotalnetbookvalueofassetsrecordedunderfinanceleases,includingsale-leasebackfinanceleases,was$38.0million(December31,2014–$61.7million).Theamortizationofassetsrecordedunderfinanceleasesisincludedintheamortizationofproperty,plantandminedevelopmentlineitemoftheconsolidatedstatementsofincomeandcomprehensiveincome.


(b) OperatingLeases

TheCompanyhasanumberofoperatingleaseagreementsinvolvingofficefacilities.Someoftheleasesforofficefacilitiescontainescalationclausesforincreasesinoperatingcostsandpropertytaxes.Futureminimumleasepaymentsrequiredtomeetobligationsthathaveinitialorremainingnon-cancellableleasetermsinexcessofoneyearareasfollows:

As at December 31,

2015

As at December 31,

2014

Within1year $ 1,780 $ 1,051

Between1–3years 2,479 1,619

Between3–5years 2,205 1,452

Thereafter 10,272 1,549

Total $ 16,736 $ 5,671

DuringtheyearendedDecember31,2015,$1.4million(yearendedDecember31,2014–$1.2million)ofoperatingleasepaymentswererecognizedintheconsolidatedstatementsofincome.

15. LONG-TERM DEBT

As at December 31,

2015

As at December 31,

2014

CreditFacility(i) $ 258,083 $ 492,470

2015Note(i) 49,364 –

2012Notes(i) 198,722 198,549

2010Notes(i) 597,567 596,966

AttributableCMGPConvertibleDebentures – 34,679

Otherattributabledebtinstruments 28,902 51,979

Totaldebt 1,132,638 1,374,643

Less:currentportion 14,451 52,182

Totallong-termdebt $ 1,118,187 $ 1,322,461

(i) Inclusiveofdeferredfinancingcosts.


ScheduledDebtPrincipalRepayments

2016 2017 2018 2019 2020 2021 and Thereafter Total

CreditFacility $ – $ – $ – $ – $ 265,000 $ – $ 265,000

2015Note – – – – – 50,000 50,000

2012Notes – – – – – 200,000 200,000

2010Notes – 115,000 – – 360,000 125,000 600,000

Otherattributabledebtinstruments 14,451 14,451 – – – – 28,902

Total $ 14,451 $ 129,451 $ – $ – $ 625,000 $ 375,000 $ 1,143,902

CreditFacility

OnSeptember5,2014,theCompanyamendeditsunsecuredrevolvingbankcreditfacility(the"CreditFacility"),extendingthematuritydatefromJune22,2017toJune22,2019andamendingpricingterms.

OnSeptember30,2015,theCompanyfurtheramendedtheCreditFacility,amongotherthings,extendingthematuritydatefromJune22,2019toJune22,2020andamendingpricingterms.

AtDecember31,2015,theCreditFacilitywasdrawndownby$265.0million(December31,2014–$500.0million).Amountsdrawndown,togetherwithoutstandinglettersofcreditundertheCreditFacility,resultedinCreditFacilityavailabilityof$924.1millionatDecember31,2015.

2015Note

OnSeptember30,2015,theCompanyclosedaprivateplacementconsistingofa$50.0millionguaranteedseniorunsecurednote(the"2015Note")withaSeptember30,2025maturitydateandayieldof4.15%(togetherwiththe2010Notesandthe2012Notes,the"Notes").Anamountequaltoorgreaterthanthenetproceedsfromthe2015NotearetobeappliedtowardminingprojectsintheProvinceofQuebec,Canada.

2012Notes

OnJuly24,2012,theCompanycloseda$200.0millionprivateplacementofguaranteedseniorunsecurednotes(the"2012Notes")which,onissuance,hadaweightedaveragematurityof11.0yearsandweightedaverageyieldof4.95%.

Thefollowingtablesetsoutdetailsoftheindividualseriesofthe2012Notes:

Principal Interest Rate Maturity Date SeriesA $ 100,000 4.87% 7/23/2022

SeriesB 100,000 5.02% 7/23/2024

Total $ 200,000


2010Notes

OnApril7,2010,theCompanycloseda$600.0millionprivateplacementofguaranteedseniorunsecurednotes(the"2010Notes")which,onissuance,hadaweightedaveragematurityof9.84yearsandweightedaverageyieldof6.59%.

Thefollowingtablesetsoutdetailsoftheindividualseriesofthe2010Notes:

Principal Interest Rate Maturity Date SeriesA $ 115,000 6.13% 4/7/2017

SeriesB 360,000 6.67% 4/7/2020

SeriesC 125,000 6.77% 4/7/2022

Total $ 600,000

CMGPConvertibleDebentures

InconnectionwithitsjointacquisitionofOsiskoonJune16,2014,CanadianMalarticGPwasassignedandassumedcertainoutstandingdebtobligationsofOsiskorelatingtotheCanadianMalarticmine.AgnicoEagle'sindirectattributableinterestinsuchdebtinstrumentsincludedtheCMGPConvertibleDebentureswithprincipaloutstandingofC$37.5million($34.6million),aNovember2017maturitydateanda6.875%interestrate.

OnJune30,2015,thenegotiatedearlysettlementofalloftheCMGPConvertibleDebentureswascompleted.Asaresultofthissettlement,871,680AgnicoEaglecommonshareswithafairvalueof$24.8millionwerereleasedfromadepositarytotheholdersoftheCMGPConvertibleDebenturesalongwithacashpaymentof$10.1milliontosettletheCompany'sobligation.IntheyearendedDecember31,2015a$2.4millionmark-to-marketlosswasrecordedintheotherexpenses(income)lineitemoftheconsolidatedstatementsofincomeandcomprehensiveincomerelatedtotheCMGPConvertibleDebentures.IntheyearendedDecember31,2014,amark-to-marketgainof$8.0millionwasrecordedrelatedtotheCMGPConvertibleDebentures.Additionalcashconsiderationof$3.2millionwaspaidtotheholdersoftheCMGPConvertibleDebenturesuponsettlementandwasrecordedintheotherexpenses(income)lineitemoftheconsolidatedstatementsofincomeandcomprehensiveincome.AsatDecember31,2015,theCMGPConvertibleDebentureshadprincipaloutstandingofnil.

OtherLoans

InconnectionwithitsjointacquisitionofOsiskoonJune16,2014,CanadianMalarticGPwasassignedandassumedcertainoutstandingdebtobligationsofOsiskorelatingtotheCanadianMalarticmine.AgnicoEagle'sindirectattributableinterestinsuchdebtobligationsincludedasecuredloanfacility(the"CMGPLoan").AscheduledrepaymentofC$20.0million($16.0million)wasmadeonJune30,2015,resultinginattributableoutstandingprincipalofC$40.0million($28.9million)asatDecember31,2015(December31,2014–$51.7million).

Covenants

PaymentandperformanceofAgnicoEagle'sobligationsundertheCreditFacilityandtheNotesisguaranteedbyeachofitsmaterialsubsidiariesandcertainofitsothersubsidiaries(the"Guarantors").

TheCreditFacilitycontainscovenantsthatlimit,amongotherthings,theabilityoftheCompanytoincuradditionalindebtedness,makedistributionsincertaincircumstancesandsellmaterialassets.


ThenotepurchaseagreementspursuanttowhichtheNoteswereissued(the"NotePurchaseAgreements")containcovenantsthatrestrict,amongotherthings,theabilityoftheCompanytoamalgamateorotherwisetransferitsassets,sellmaterialassets,carryonabusinessotherthanonerelatedtominingandtheabilityoftheGuarantorstoincurindebtedness.

TheCreditFacilityandNotePurchaseAgreementsalsorequiretheCompanytomaintainatotalnetdebttoearningsbeforeinterest,taxes,depreciationandamortization("EBITDA")ratiobelowaspecifiedmaximumvalue.

TheCMGPLoanrequiresCanadianMalarticGPtomaintainaminimumEBITDAtointerestexpenseratioandamaximumdebttoEBITDAratio.

TheCompanywasincompliancewithallcovenantscontainedintheCreditFacilityandNotePurchaseAgreementsasatDecember31,2015.CanadianMalarticGPwasincompliancewithallCMGPLoancovenantsasatDecember31,2015.

InterestonLong-termDebt

Totallong-termdebtinterestcostsincurredduringtheyearendedDecember31,2015were$58.8million(2014–$56.9million).

Totalborrowingcostscapitalizedtoproperty,plantandminedevelopmentduringtheyearendedDecember31,2015were$1.7million(2014–$1.7million)atacapitalizationrateof1.25%(2014–1.28%).

DuringtheyearendedDecember31,2015,cashinterestpaidontheCreditFacilitywas$8.7million(2014–$7.5million),cashstandbyfeespaidontheCreditFacilitywere$3.8million(2014–$5.1million)andcashinterestpaidontheNoteswas$49.4million(2014–$49.4million).

16. OTHER LIABILITIES

Otherliabilitiesconsistofthefollowing:

As at December 31,

2015

As at December 31,

2014 Long-termportionofcapitalleaseobligations(note14(a)) $ 9,547 $ 21,137

Pensionbenefitobligations(note16(a)) 17,146 17,507

Other 7,345 159

Totalotherliabilities $ 34,038 $ 38,803

(a) PensionBenefitObligations

Executives Plan

AgnicoEagleprovidestheExecutivesPlanforcertaincurrentandformerseniorofficers.ItisconsideredadefinedbenefitplanasdefinedinIAS19–Employee Benefits withapensionformulabasedonfinalaverageearningsinexcessoftheamountspayablefromtheregisteredplan.AssetsfortheExecutivesPlanconsistofdepositsonhandwithregulatoryauthoritiesthatarerefundablewhenbenefitpaymentsaremadeorontheultimatewind-upoftheplan.TheestimatedaverageremainingservicelifeoftheplanatDecember31,2015is3.0years.ThefundedstatusoftheExecutivesPlanisbasedonactuarialvaluationsperformedasofDecember31,2015.


ThefundedstatusoftheExecutivesPlanfor2015and2014isasfollows:

Year Ended December 31, 2015 2014 Reconciliation of the Executives Plan assets:

ExecutivesPlanassets,beginningofyear $ 2,278 $ 2,346

AgnicoEagle'scontributions 312 372

Benefitpayments (202) (239)

InterestonExecutivesPlanassets 83 111

NetreturnonExecutivesPlanassetsexcludinginterest (83) (111)

Effectofexchangeratechanges (377) (201)

ExecutivesPlanassets,endofyear 2,011 2,278

Reconciliation of Executives Plan defined benefit obligation:

Definedbenefitobligation,beginningofyear 11,895 11,298

Servicecost 435 470

Benefitpayments (202) (239)

Interestcost 445 550

Actuariallossesarisingfromchangesineconomicassumptions – 1,581

Actuarialgainsarisingfromchangesindemographicassumptions – (164)

Actuariallosses(gains)arisingfromExecutivesPlanexperience 48 (584)

Effectofexchangeratechanges (1,980) (1,017)

Definedbenefitobligation,endofyear 10,641 11,895

Net defined benefit liability, end of year $ 8,630 $ 9,617


ThecomponentsofAgnicoEagle'spensionexpenserecognizedintheconsolidatedstatementsofincomerelatingtotheExecutivesPlanareasfollows:

Year Ended December 31, 2015 2014 Servicecost $ 435 $ 470

Interestcostondefinedbenefitobligation 445 550

InterestonExecutivesPlanassets (83) (111)

Pensionexpense $ 797 $ 909

Theremeasurementsofthenetdefinedbenefitliabilityrecognizedinothercomprehensiveincome(loss)relatingtotheExecutivesPlanareasfollows:

Year Ended December 31, 2015 2014 Actuariallossesrelatingtothedefinedbenefitobligation $ 48 $ 833

NetreturnonExecutivesPlanassetsexcludinginterest 83 111

Totalremeasurementsofthenetdefinedbenefitliability $ 131 $ 944

In2016,theCompanyexpectstomakecontributionsof$0.2millionandbenefitpaymentsof$0.1millionrelatedtotheExecutivesPlan.

ThefollowingtablesetsoutsignificantweightedaverageassumptionsusedinmeasuringtheCompany'sExecutivesPlandefinedbenefitobligation:

As at December 31, 2015 2014 Assumptions:

Discountrate–beginningofyear 4.0% 4.9%

Discountrate–endofyear 4.0% 4.0%

Rateofcompensationincrease 3.0% 3.0%


ThefollowingisasummaryoftheeffectofchangesinsignificantactuarialassumptionsontheCompany'sExecutivesPlandefinedbenefitobligation:

As at December 31,

2015

Change in assumption:

0.5%increaseindiscountrate $ (726)

0.5%decreaseindiscountrate 802

0.5%increaseintherateofcompensationincrease 50

0.5%decreaseintherateofcompensationincrease (50)

ThesummaryoftheeffectofchangesinsignificantactuarialassumptionswaspreparedusingthesamemethodsandactuarialassumptionsasthoseusedforthecalculationoftheExecutivesPlandefinedbenefitobligationasattheendofthefiscalyear,exceptforthechangeinthesingleactuarialassumptionbeingevaluated.Themodificationofseveralactuarialassumptionsatthesametimecouldleadtodifferentresults.

Other Plans

InadditiontotheExecutivesPlan,theCompanymaintainstheBasicPlanandtheSupplementalPlan.UndertheBasicPlan,AgnicoEaglecontributes5.0%ofcertainemployees'baseemploymentcompensationtoadefinedcontributionplan.In2015,$9.8million(2014–$11.1million)wascontributedtotheBasicPlan,$0.1millionofwhichrelatedtocontributionsforkeymanagementpersonnel(2014–$0.1million).EffectiveJanuary1,2008,theCompanyadoptedtheSupplementalPlanfordesignatedexecutivesatthelevelofVice-Presidentorabove.TheSupplementalPlanisfundedbytheCompanythroughnotionalcontributionsequalto10.0%ofthedesignatedexecutive'searningsfortheyear(includingsalaryandshort-termbonus).In2015,theCompanymade$1.3million(2014–$1.5million)innotionalcontributionstotheSupplementalPlan,$0.2million(2014–$0.1million)ofwhichrelatedtocontributionsforkeymanagementpersonnel.TheCompany'sliabilityrelatedtotheSupplementalPlanis$5.3millionatDecember31,2015(December31,2014–$5.0million).TheSupplementalPlanisaccountedforasacashbalanceplan.




17. EQUITY

CommonShares

TheCompany'sauthorizedsharecapitalincludesanunlimitednumberofcommonshareswithnoparvalue.AsatDecember31,2015,AgnicoEagle'sissuedcommonsharestotaled218,028,368(December31,2014–215,192,887),less377,573commonsharesheldinatrust(December31,2014–956,653commonsharesheldinatrustrelatedtotheRSUplanorbyadepositarytosatisfyobligationsinconnectionwiththeCMGPConvertibleDebenturesthatweresettledonJune30,2015).

373,785commonsharesareheldinatrustinconnectionwiththeCompany'sRSUplan(December31,2014–84,973commonsharesheldinatrust).

Inthefirstquarterof2015,aLongTermIncentivePlan("LTIP")wasimplementedforcertainemployeesofthejointlyownedCanadianMalarticGPandCanadianMalarticCorporationcomprisedof50.0%deferredcash,25.0%AgnicoEaglecommonsharesand25.0%Yamanacommonsharesandvestingoveraperiodrangingbetween18to36months.AsatDecember31,2015,3,788AgnicoEaglecommonshareswereheldinatrustinconnectionwiththeLTIP.

ThetrustshavebeenevaluatedunderIFRS10–Consolidated Financial Statements andareconsolidatedintheaccountsoftheCompany,withsharesheldintrustoffsetagainsttheCompany'sissuedsharesinitsconsolidatedfinancialstatements.Thecommonsharespurchasedandheldinatrustareexcludedfromthebasicnetincomepersharecalculationsuntiltheyhavevested.Allofthenon-vestedcommonsharesheldinatrustareincludedinthedilutednetincomepersharecalculations,unlesstheimpactisanti-dilutive.

ThefollowingtablesetsoutthemaximumnumberofcommonsharesthatwouldbeoutstandingifalldilutiveinstrumentsoutstandingatDecember31,2015wereexercised:

CommonsharesoutstandingatDecember31,2015 217,650,795

Employeestockoptions 12,082,212

CommonsharesheldinatrustinconnectionwiththeRSUplan(note19(c))andLTIP 377,573

Total 230,110,580


NetIncomePerShare

Thefollowingtablesetsouttheweightedaveragenumberofcommonsharesusedinthecalculationofbasicanddilutednetincomepershare:

Year Ended December 31, 2015 2014 Netincomefortheyear–basic $ 24,583 $ 82,970

Less:DilutiveimpactofCMGPConvertibleDebentures(i) – (7,345)

Netincomefortheyear–diluted $ 24,583 $ 75,625

Weightedaveragenumberofcommonsharesoutstanding–basic(inthousands) 216,168 195,223

Add:DilutiveimpactofcommonsharesheldbyadepositaryrelatingtoCMGPConvertibleDebentures(i) – 475

Add:DilutiveimpactofcommonsharesrelatedtotheRSUplanandLTIP 300 259

Add:Dilutiveimpactofemployeestockoptions 633 244

Weightedaveragenumberofcommonsharesoutstanding–diluted(inthousands) 217,101 196,201

Netincomepershare–basic $ 0.11 $ 0.43

Netincomepershare–diluted $ 0.11 $ 0.39

Note:

(i) InconnectionwiththejointacquisitionofOsiskoMiningCorporationonJune16,2014,AgnicoEagleindirectlyassumeditsattributableinterestintheCMGPConvertibleDebentures.OnJune30,2015,thenegotiatedearlysettlementofalltheCMGPConvertibleDebentureswascompleted,resultinginprincipaloutstandingofnil.TheimpactoftheCMGPConvertibleDebentureshasbeenincludedinthecalculationofdilutednetincomepersharewheredilutiveandhasbeenexcludedfromthecalculationofdilutednetincomepersharewhereanti-dilutive.ThedilutiveimpactoftheCMGPConvertibleDebentures,includingboththeirimpactondilutednetincomeandthedilutiveimpactofrelatedcommonsharesheldbyadepositaryinconnectionwithanyconversionthereof,wasexcludedfromthecalculationofdilutednetincomepersharefortheyearendedDecember31,2015astheirimpactwouldhavebeenanti-dilutivefortheportionoftheyeartheywereoutstanding.

Dilutednetincomepersharehasbeencalculatedusingthetreasurystockmethod.Inapplyingthetreasurystockmethod,outstandingemployeestockoptionswithanexercisepricegreaterthantheaveragequotedmarketpriceofthecommonsharesfortheperiodoutstandingarenotincludedinthecalculationofdilutednetincomepershareastheimpactwouldbeanti-dilutive.

FortheyearendedDecember31,2015,6,806,055(yearendedDecember31,2014–9,102,210)employeestockoptionswereexcludedfromthecalculationofdilutednetincomepershareastheirimpactwouldhavebeenanti-dilutive.

18. REVENUES FROM MINING OPERATIONS AND TRADE RECEIVABLES

AgnicoEagleisagoldminingcompanywithminingoperationsinCanada,MexicoandFinland.TheCompanyearnsasignificantproportionofitsrevenuesfromtheproductionandsaleofgoldinbothdorebarandconcentrateform.Theremainderofrevenueandcashflowisgeneratedbytheproductionandsaleofby-productmetals.Therevenuefromby-productmetalsisprimarilygeneratedbyproductionattheLaRondemineinCanada(silver,zincandcopper)andthePinosAltosmineinMexico(silver).


ThecashflowandprofitabilityoftheCompany'soperationsaresignificantlyaffectedbythemarketpriceofgoldand,toalesserextent,silver,zincandcopper.ThepricesofthesemetalscanfluctuatesignificantlyandareaffectedbynumerousfactorsbeyondtheCompany'scontrol.

DuringtheyearendedDecember31,2015,fourcustomerseachcontributedmorethan10.0%oftotalrevenuesfromminingoperationsforacombinedtotalofapproximately78.0%ofrevenuesfromminingoperationsintheNorthernandSouthernbusinessunits.However,goldcanbesoldthroughnumerousgoldmarkettradersworldwide,theCompanyisnoteconomicallydependentonalimitednumberofcustomersforthesaleofitsproduct.

TradereceivablesarerecognizedoncethetransferofownershipforthemetalssoldhasoccurredandreflecttheamountsowingtotheCompanyinrespectofitssalesofdorebarsorconcentratestothirdpartiespriortothesatisfactioninfullofthepaymentobligationsofthethirdparties.AsatDecember31,2015,theCompanyhad$7.7million(December31,2014–$59.7million)inreceivablesrelatingtoprovisionallypricedconcentratesales.FortheyearendedDecember31,2015,theCompanyrecognizedmark-to-marketlossesof$0.5million(2014–$0.8million)onconcentratereceivables.

Year Ended December 31, 2015 2014 Revenues from mining operations:

Gold $ 1,911,500 $ 1,807,927

Silver 66,991 62,466

Zinc 505 9,901

Copper 6,436 16,479

Lead(i) – (7)

Totalrevenuesfromminingoperations $ 1,985,432 $ 1,896,766

Note:

(i) Lead concentrate revenues of nil in 2015 (2014 – $0.1 million) are netted against direct fees of nil (2014 – $0.1 million). Other metal revenues derived from leadconcentrate are included in their respective metal categories in the above table.

In2015,preciousmetals(goldandsilver)accountedfor99.7%ofAgnicoEagle'srevenuesfromminingoperations(2014–98.6%).Theremainingrevenuesfromminingoperationsconsistedofnetby-productmetalrevenuesfromnon-preciousmetals.

19. STOCK-BASED COMPENSATION

(a) EmployeeStockOptionPlan

TheCompany'sESOPprovidesforthegrantofstockoptionstodirectors,officers,employeesandserviceproviderstopurchasecommonshares.UndertheESOP,stockoptionsaregrantedatthefairmarketvalueoftheunderlyingsharesonthedaypriortothedateofgrant.Thenumberofcommonsharesthatmaybereservedforissuancetoanyonepersonpursuanttostockoptions(undertheESOPorotherwise),warrants,sharepurchaseplansorotherarrangementsmaynotexceed5.0%oftheCompany'scommonsharesissuedandoutstandingatthedateofgrant.

OnApril24,2001,theCompensationCommitteeoftheBoardadoptedapolicypursuanttowhichstockoptionsgrantedafterthatdatehaveamaximumtermoffiveyears.In2013,theshareholdersapprovedaresolutiontoincreasethenumberofcommonsharesreservedforissuanceundertheESOPto27,800,000.


Ofthe3,068,080stockoptionsgrantedundertheESOPin2015,688,995stockoptionsvestedimmediately.Theremainingstockoptions,allofwhichexpirein2020,vestinequalinstallmentsoneachanniversarydateofthegrantoverathree-yearperiod.Ofthe3,187,500stockoptionsgrantedundertheESOPin2014,796,875stockoptionsvestedimmediately.Theremainingstockoptions,allofwhichexpirein2019,vestinequalinstallmentsoneachanniversarydateofthegrantoverathree-yearperiod.UpontheexerciseofstockoptionsundertheESOP,theCompanyissuescommonsharesfromtreasurytosettletheobligation.

ThefollowingtablesetsoutactivitywithrespecttoAgnicoEagle'soutstandingstockoptions:

Year Ended December 31, 2015

Year Ended December 31, 2014

Number of Stock

Options

Weighted Average Exercise

Price

Number of Stock

Options


Price

Outstanding,beginningofyear 11,913,210 C$ 48.84 11,283,535 C$ 56.02

Granted 3,068,080 29.09 3,187,500 28.07

Exercised (747,683) 29.68 (582,925) 31.46

Forfeited (92,314) 40.40 (250,750) 53.08

Expired (2,059,081) 57.20 (1,724,150) 62.64

Outstanding,endofyear 12,082,212 C$ 43.65 11,913,210 C$ 48.84

Optionsexercisable,endofyear 7,519,120 C$ 50.71 7,503,335 C$ 55.98

TheaveragesharepriceofAgnicoEagle'scommonsharesduringtheyearendedDecember31,2015wasC$36.16(2014–C$34.83)

Theweightedaveragegrantdatefairvalueofstockoptionsgrantedin2015wasC$8.10(2014–C$6.53).

ThefollowingtablesetsoutinformationaboutAgnicoEagle'sstockoptionsoutstandingandexercisableatDecember31,2015:

Stock Options Outstanding

Stock Options Exercisable

Range of Exercise Prices Number

Outstanding

Weighted Average

Remaining Contractual

Life


PriceNumber

Exercisable


Price

C$28.03–C$39.46 7,274,207 2.83years C$ 30.99 3,386,865 C$ 33.74

C$40.66–C$53.14 2,674,500 2.03years $ 51.94 1,998,750 $ 52.02

C$63.39–C$76.60 2,133,505 0.02years $ 76.44 2,133,505 $ 76.44

C$28.03–C$76.60 12,082,212 2.15years C$ 43.65 7,519,120 C$ 50.71


TheweightedaverageremainingcontractualtermofstockoptionsexercisableatDecember31,2015was1.41years.

TheCompanyhasreservedforissuance12,082,212commonsharesintheeventthatthesestockoptionsareexercised.

ThenumberofcommonsharesavailableforthegrantofstockoptionsundertheESOPasatDecember31,2015andDecember31,2014was2,678,591and3,595,276,respectively.

SubsequenttotheyearendedDecember31,2015,2,140,075stockoptionsweregrantedundertheESOP,ofwhich535,019stockoptionsvestedwithin30daysofthegrant.Theremainingstockoptions,allofwhichexpirein2021,vestinequalinstallmentsoneachanniversarydateofthegrantoverathree-yearperiod.

AgnicoEagleestimatedthefairvalueofstockoptionsundertheBlack-Scholesoptionpricingmodelusingthefollowingweightedaverageassumptions:

Year Ended December 31, 2015 2014 Risk-freeinterestrate 1.50% 1.52%

Expectedlifeofstockoptions(inyears) 2.7 2.6

ExpectedvolatilityofAgnicoEagle'sshareprice 45.0% 42.5%

Expecteddividendyield 1.69% 3.82%

TheCompanyuseshistoricalvolatilitytoestimatetheexpectedvolatilityofAgnicoEagle'sshareprice.Theexpectedtermofstockoptionsgrantedisderivedfromhistoricaldataonemployeeexerciseandpost-vestingemploymentterminationexperience.

ThetotalcompensationexpensefortheESOPrecordedinthegeneralandadministrativelineitemoftheconsolidatedstatementsofincomeandcomprehensiveincomefor2015was$20.1million(2014–$20.8million).OfthetotalcompensationcostfortheESOP,$0.6millionwascapitalizedaspartoftheproperty,plantandminedevelopmentlineitemoftheconsolidatedbalancesheetsin2015(2014–$0.8million).

(b) IncentiveSharePurchasePlan

OnJune26,1997,theCompany'sshareholdersapprovedtheISPPtoencouragedirectors,officersandemployees("Participants")topurchaseAgnicoEagle'scommonsharesatmarketvalue.In2009,theISPPwasamendedtoremovenon-executivedirectorsaseligibleParticipants.

UndertheISPP,Participantsmaycontributeupto10.0%oftheirbasicannualsalariesandtheCompanycontributesanamountequalto50.0%ofeachParticipant'scontribution.AllcommonsharessubscribedforundertheISPPareissuedbytheCompany.Thetotalcompensationcostrecognizedin2015relatedtotheISPPwas$4.7million(2014–$5.2million).

In2015,512,438commonsharesweresubscribedforundertheISPP(2014–517,721)foravalueof$14.0million(2014–$15.5million).InMay2015,theCompany'sshareholdersapprovedanincreaseinthemaximumnumberofcommonsharesreservedforissuanceundertheISPPto7,100,000from6,100,000.AsatDecember31,2015,AgnicoEaglehasreservedforissuance1,899,748commonshares(2014–1,412,186)undertheISPP.


(c) RestrictedShareUnitPlan

In2009,theCompanyimplementedtheRSUplanforcertainemployees.EffectiveJanuary1,2012,theRSUplanwasamendedtoincludedirectorsandseniorexecutivesoftheCompany.

AdeferredcompensationbalanceisrecordedforthetotalgrantdatevalueonthedateofeachRSUplangrant.Thedeferredcompensationbalanceisrecordedasareductionofequityandisamortizedascompensationexpenseoverthevestingperiodofthreeyears.

In2015,423,822(2014–298,877)RSUsweregrantedwithagrantdatefairvalueof$27.99(2014–$28.62).In2015,theCompanyfundedtheRSUplanbytransferring$11.5million(2014–$7.5million)toanemployeebenefittrustthatthenpurchasedcommonsharesoftheCompanyintheopenmarket.ThegrantdatefairvalueoftheRSUsgenerallyapproximatesthecostofpurchasingthesharesintheopenmarket.Oncevested,thecommonsharesinthetrustaredistributedtosettletheobligationalongwithacashpaymentreflectingtheaccumulatedamountthatwouldhavebeenpaidasdividendshadthecommonsharesbeenoutstanding.

CompensationexpenserelatedtotheRSUplanwas$12.0millionin2015(2014–$12.8million).CompensationexpenserelatedtotheRSUplanisincludedaspartofthegeneralandadministrativelineitemoftheconsolidatedstatementsofincomeandcomprehensiveincome.

SubsequenttotheyearendedDecember31,2015,340,042RSUsweregrantedundertheRSUplan.

20. CAPITAL AND FINANCIAL RISK MANAGEMENT

TheCompany'sactivitiesexposeittoavarietyoffinancialrisks:marketrisk(includinginterestraterisk,commoditypriceriskandforeigncurrencyrisk),creditriskandliquidityrisk.TheCompany'soverallriskmanagementpolicyistosupportthedeliveryoftheCompany'sfinancialtargetswhileminimizingthepotentialadverseeffectsontheCompany'sperformance.

RiskmanagementiscarriedoutbyacentralizedtreasurydepartmentunderpoliciesapprovedbytheBoard.TheCompany'sfinancialactivitiesaregovernedbypoliciesandproceduresanditsfinancialrisksareidentified,measuredandmanagedinaccordancewithitspoliciesandrisktolerance.

a) MarketRisk

Marketriskistheriskthatchangesinmarketfactors,suchasinterestrates,commoditypricesandforeignexchangerates,willaffectthevalueofAgnicoEagle'sfinancialinstruments.TheCompanycanchoosetoeitheracceptmarketriskormitigateitthroughtheuseofderivativesandothereconomichedgingstrategies.

i. InterestRateRisk

Interestrateriskistheriskthatthefairvalueoffuturecashflowsofafinancialinstrumentwillfluctuateasaresultofchangesinmarketinterestrates.TheCompany'sexposuretotheriskofchangesinmarketinterestratesrelatesprimarilytotheCompany'slong-termdebtobligationsthathavefloatinginterestrates.


Thefollowingtablesetsouttheimpactofa1.0%increaseordecreaseininterestratesonincomebeforeincomeandminingtaxes.Theimpactonequityisthesameastheimpactonincomebeforeincomeandminingtaxes.

Year Ended December 31, 2015 2014 1.0%Increase $ (4,454) $ (3,548)

1.0%Decrease $ 4,454 $ 3,548

ii. CommodityPriceRisk

a. MetalPrices

AgnicoEagle'srevenuesfromminingoperationsandnetincomearesensitivetometalprices.Changesinthemarketpriceofgoldmaybeattributedtonumerousfactorssuchasdemand,globalmineproductionlevels,centralbankpurchasesandsalesandinvestorsentiment.Changesinthemarketpricesofby-productmetals(silver,zincandcopper)maybeattributedtofactorssuchasdemandandglobalmineproductionlevels.

Inordertomitigatetheimpactoffluctuatingby-productmetalprices,theCompanyoccasionallyentersintoderivativefinancialinstrumentcontractsunderitsBoard-approvedRiskManagementPoliciesandProcedures.TheCompanyhasalong-standingpolicyofnoforwardgoldsales.However,thepolicydoesallowtheCompanytouseothereconomichedgingstrategies,whereappropriate,tomitigateby-productmetalpricingrisks.TheCompanyoccasionallybuysputoptions,entersintopricecollarsandentersintoforwardcontractstoprotectminimumby-productmetalpriceswhilemaintainingfullexposuretothepriceofgold.TheRiskManagementCommitteehasapprovedthestrategyofusingshort-termcalloptionsinanattempttoenhancetherealizedby-productmetalprices.TheCompany'spolicydoesnotallowspeculativetrading.

b. Fuel

Tomitigatetherisksassociatedwithfluctuatingdieselfuelprices,theCompanyusesderivativefinancialinstrumentsaseconomichedgesofthepriceriskonaportionofitsdieselfuelcosts(refertonote21totheseconsolidatedfinancialstatementsforfurtherdetailsonderivativefinancialinstruments).

iii. ForeignCurrencyRisk

TheCompanyreceivespaymentforallofitsmetalsalesinUSdollarsandpaysmostofitsoperatingandcapitalcostsinCanadiandollars,EurosorMexicanpesos.Thisgivesrisetosignificantcurrencyriskexposure.TheCompanyentersintocurrencyeconomichedgingtransactionsundertheBoard-approvedForeignExchangeRiskManagementPoliciesandProcedures,tohedgepartofitsforeigncurrencyexposure.Thepolicydoesnotpermitthehedgingoftranslationexposure(thatis,thegainsandlossesthatarisefromtheaccountingtranslationofCanadiandollar,EuroorMexicanpesodenominatedassetsandliabilitiesintoUSdollars),asitdoesnotgiverisetocashexposure.TheCompany'sforeigncurrencyderivativefinancialinstrumentstrategyincludestheuseofpurchasedputs,soldcalls,collarsandforwardsthatarenotheldforspeculativepurposes(refertonote21totheseconsolidatedfinancialstatementsforfurtherdetailsontheCompany'sderivativefinancialinstruments).


ThefollowingtablesetsoutthetranslationimpactonincomebeforeincomeandminingtaxesandequityfortheyearendedDecember31,2015ofa10.0%changeintheexchangerateoftheUSdollarrelativetotheCanadiandollar,EuroandMexicanpeso,withallothervariablesheldconstant.

Impact on Income Before Income and

Mining Taxes and Equity

10.0%Strengthening of the US Dollar

10.0% Weakening

of the US Dollar

Canadiandollar $ 6,304 $ (6,304)

Euro $ 2,595 $ (2,595)

Mexicanpeso $ (1,534) $ 1,534

b) CreditRisk

Creditriskistheriskthatathirdpartymightfailtofulfillitsobligationsunderthetermsofafinancialinstrument.Creditriskarisesfromcashandcashequivalents,short-terminvestments,restrictedcash,tradereceivablesandderivativefinancialinstruments.TheCompanyholdsitscashandcashequivalents,restrictedcashandshort-terminvestmentsinhighlyratedfinancialinstitutionsresultinginalowlevelofcreditrisk.Fortradereceivablesandderivativefinancialinstruments,historicallevelsofdefaulthavebeennegligible,resultinginalowlevelofcreditrisk.TheCompanymitigatescreditriskbydealingwithrecognizedcreditworthycounterpartiesandlimitingconcentrationrisk.Forderivativefinancialinstrumentliabilities,theCompanyassumesnocreditriskwhenthefairvalueofaninstrumentisnegative.Themaximumexposuretocreditriskisequaltothecarryingamountoftheinstrumentsasfollows:

As at December 31,

2015

As at December 31,

2014

Cashandcashequivalents $ 124,150 $ 177,537

Short-terminvestments 7,444 4,621

Restrictedcash 1,426 54,021

Tradereceivables 7,714 59,716

Derivativefinancialinstrumentassets 87 4,877

Total $ 140,821 $ 300,772

c) LiquidityRisk

LiquidityriskistheriskthattheCompanywillencounterdifficultyinmeetingobligationsassociatedwithfinancialliabilitiesthataresettledbydeliveringcashoranotherfinancialasset.TheCompanymonitorsitsriskofashortageoffundsbymonitoringitsdebtratingandprojectedcashflowstakingintoaccountthematuritydatesofexistingdebtandotherpayables.TheCompanymanagesexposuretoliquidityriskbymaintainingcashbalances,havingaccesstoundrawncreditfacilitiesandaccesstopublicdebtmarkets.Contractualmaturitiesrelatingtofinanceleaseobligationsaredetailedinnote14totheseconsolidatedfinancialstatementsandcontractualmaturities


relatingtolong-termdebtaredetailedinnote15totheseconsolidatedfinancialstatements.Otherfinancialliabilities,includingaccountspayableandaccruedliabilitiesandderivativefinancialinstruments,havematuritieswithinoneyearofDecember31,2015.

d) CapitalRiskManagement

TheCompany'sprimarycapitalmanagementobjectiveistomaintainanoptimalcapitalstructuretosupportcurrentandlong-termbusinessactivitiesandtoprovidefinancialflexibilityinordertomaximizevalueforequityholders.

AgnicoEagle'scapitalstructurecomprisesamixoflong-termdebtandtotalequityasfollows:

As at December 31,

2015

As at December 31,

2014

Long-termdebt $ 1,132,638 $ 1,374,643

Totalequity 4,141,020 4,068,490

Total $ 5,273,658 $ 5,443,133

TheCompanymanagesitscapitalstructureandmakesadjustmentstoitbasedonchangesineconomicconditionsandtherequirementsoffinancialcovenants.Toeffectivelymanageitscapitalrequirements,AgnicoEaglehasinplacearigorousplanning,budgetingandforecastingprocesstoensureithastheappropriateliquiditytomeetitsoperatingandgrowthobjectives.TheCompanyhastheabilitytoadjustitscapitalstructurebyvariousmeans.

Seenote15totheseconsolidatedfinancialstatementsfordetailsrelatedtoAgnicoEagle'scompliancewithitslong-termdebtcovenants.

21. DERIVATIVE FINANCIAL INSTRUMENTS

CurrencyRiskManagement

TheCompanyutilizesforeignexchangeeconomichedgestoreducethevariabilityinexpectedfuturecashflowsarisingfromchangesinforeigncurrencyexchangerates.TheCompanyisprimarilyexposedtocurrencyfluctuationsrelativetotheUSdollarasaportionoftheCompany'soperatingcostsandcapitalexpendituresaredenominatedinforeigncurrencies;primarilytheCanadiandollar,theEuroandtheMexicanpeso.Thesepotentialcurrencyfluctuationsincreasethevolatilityof,andcouldhaveasignificantimpacton,theCompany'sproductioncosts.Theeconomichedgesrelatetoaportionoftheforeigncurrencydenominatedcashoutflowsarisingfromforeigncurrencydenominatedexpenditures.TheCompanydoesnotapplyhedgeaccountingtothesearrangements.

AsatDecember31,2015,theCompanyhadoutstandingforeignexchangezerocostcollars.ThepurchaseofUSdollarputoptionswasfinancedthroughsellingUSdollarcalloptionsatahigherlevelsuchthatthenetpremiumpayabletothedifferentcounterpartiesbytheCompanywasnil.AtDecember31,2015,thezerocostcollarsrelatedto$217.0millionof2016expendituresandtheCompanyrecognizedmark-to-marketadjustmentsinthelossonderivativefinancialinstrumentslineitemoftheconsolidatedstatementsofincomeandcomprehensiveincome.Mark-to-marketgains(losses)relatedtoforeignexchangederivativefinancialinstrumentsarerecordedatfairvaluebasedonbroker-dealerquotationscorroboratedbyoptionpricingmodelsthatutilizeperiodendforwardpricingoftheapplicableforeigncurrencytocalculatefairvalue.




21. DERIVATIVE FINANCIAL INSTRUMENTS (Continued)

TheCompany'sotherforeigncurrencyderivativestrategiesin2015and2014consistedmainlyofwritingUSdollarcalloptionswithshortmaturitiestogeneratepremiumsthatwould,inessence,enhancethespottransactionratereceivedwhenexchangingUSdollarsforCanadiandollars.AllofthesederivativetransactionsexpiredpriortoyearendsuchthatnoderivativeswereoutstandingasatDecember31,2015orDecember31,2014.Thecalloptionpremiumswererecognizedinthelossonderivativefinancialinstrumentslineitemoftheconsolidatedstatementsofincomeandcomprehensiveincome.

CommodityPriceRiskManagement

Tomitigatetherisksassociatedwithfluctuatingdieselfuelprices,theCompanyusesderivativefinancialinstrumentsaseconomichedgesofthepriceriskonaportionofdieselfuelcostsassociatedwiththeMeadowbankmine'sdieselfuelexposureasitrelatestooperatingcosts.TherewerederivativefinancialinstrumentsoutstandingatDecember31,2015relatingto7.0milliongallonsofheatingoil(December31,2014–14.0milliongallons).Therelatedmark-to-marketadjustmentspriortosettlementwererecognizedinthelossonderivativefinancialinstrumentslineitemoftheconsolidatedstatementsofincomeandcomprehensiveincome.TheCompanydoesnotapplyhedgeaccountingtothesearrangements.

Mark-to-marketgains(losses)relatedtoheatingoilderivativefinancialinstrumentsarebasedonbroker-dealerquotationsthatutilizeyearendforwardpricingtocalculatefairvalue.

AsatDecember31,2015andDecember31,2014,therewerenometalderivativepositions.TheCompanymayfromtimetotimeutilizeshort-termfinancialinstrumentsaspartofitsstrategytominimizerisksandoptimizereturnsonitsby-productmetalsales.

Thefollowingtablesetsoutasummaryoftheamountsrecognizedinthelossonderivativefinancialinstrumentslineitemoftheconsolidatedstatementsofincomeandcomprehensiveincome:


2015

2014

Premiumsrealizedonwrittenforeignexchangecalloptions $ 2,654 $ 2,725

Realizedgain(loss)onwarrants 9,072 (4,263)

Unrealized(loss)gainonwarrants(i) (2,213) 3,426

Realized(loss)gainoncurrencyandcommodityderivatives (29,297) 20

Unrealizedgain(loss)oncurrencyandcommodityderivatives(i) 176 (8,064)

Totallossonderivativefinancialinstruments $ (19,608) $ (6,156)

Note:

(i) Unrealizedgainsandlossesonfinancialinstrumentsthatdidnotqualifyforhedgeaccountingarerecognizedthroughthelossonderivativefinancialinstrumentslineitemoftheconsolidatedstatementsofincomeandcomprehensiveincomeandthroughtheotherlineitemoftheconsolidatedstatementsofcashflows.

22. SEGMENTED INFORMATION

AgnicoEagleoperatesinasingleindustry,namelyexplorationforandproductionofgold.TheCompany'sprimaryoperationsareinCanada,MexicoandFinland.TheCompanyidentifiesitsreportablesegmentsasthoseoperationswhoseoperatingresultsarereviewedbytheChiefOperatingDecisionMaker("CODM"),theChiefExecutiveOfficerforthepurposeofallocatingresourcesandassessingperformanceandthatrepresentmorethan10.0%ofthecombinedrevenuefromminingoperations,incomeorlossortotalassetsofalloperatingsegments.EachoftheCompany'ssignificantoperatingminesandprojectsareconsideredtobeseparateoperatingsegments.Certainoperatingsegmentsthatdonotmeetthequantitative


thresholdsarestilldisclosedwhentheCompanybelievesthattheinformationisuseful.TheCODMalsoreviewssegmentincome(definedasrevenuesfromminingoperationslessproductioncosts,explorationandcorporatedevelopmentexpensesandimpairmentlosses)onamine-by-minebasis.ThefollowingaretheCompany'sreportablesegmentsorganizedaccordingtotheirrelationshipwiththeCompany'sthreebusinessunitsandreflecthowtheCompanymanagesitsbusinessandhowitclassifiesitsoperationsforplanningandmeasuringperformance:

NorthernBusiness: LaRondemine,Lapamine,Goldexmine,MeadowbankmineincludingtheAmaruqdeposit,CanadianMalarticjointoperation,MeliadineprojectandKittilamine

SouthernBusiness: PinosAltosmine,CrestonMascotadepositatPinosAltosandLaIndiamine

Exploration: UnitedStatesExplorationoffice,EuropeExplorationoffice,CanadaExplorationofficesandLatinAmericaExplorationoffice

Revenuesfromminingoperationsandproductioncostsforthereportablesegmentsarereportednetofintercompanytransactions.


Corporateandotherassetsandspecificincomeandexpenseitemsarenotallocatedtoreportablesegments.

Year Ended December 31, 2015:

Revenues from Mining

Operations

Production Costs

Exploration and Corporate

Development

Segment Income (Loss)

Northern Business:

LaRondemine $ 318,207 $ (172,283) $ – $ 145,924

Lapamine 104,785 (52,571) – 52,214

Goldexmine 133,845 (61,278) – 72,567

Meadowbankmine 446,898 (230,564) (43,676) 172,658

CanadianMalarticjointoperation(note5) 333,280 (171,473) (6,093) 155,714

Kittilamine 206,357 (126,095) – 80,262

Total Northern Business 1,543,372 (814,264) (49,769) 679,339

Southern Business:

PinosAltosmine 250,909 (105,175) – 145,734

CrestonMascotadepositatPinosAltos 66,472 (26,278) – 40,194

LaIndiamine 124,679 (49,578) – 75,101

Total Southern Business 442,060 (181,031) – 261,029

Exploration – – (60,584) (60,584)

Segments totals $ 1,985,432 $ (995,295) $ (110,353) $ 879,784

Totalsegmentsincome $ 879,784

Corporateandother:

Amortizationofproperty,plantandminedevelopment (608,609)

Generalandadministrative (96,973)

Impairmentlossonavailable-for-salesecurities (12,035)

Financecosts (75,228)

Lossonderivativefinancialinstruments (19,608)

Gainonsaleofavailable-for-salesecurities 24,600

Environmentalremediation (2,003)

Foreigncurrencytranslationgain 4,728

Otherexpenses (12,028)

Incomebeforeincomeandminingtaxes $ 82,628


Year Ended December 31, 2014:

Revenues from Mining

Operations

Production Costs

Exploration and Corporate

Development

Segment Income (Loss)

Northern Business:

LaRondemine $ 308,794 $ (188,736) $ – $ 120,058

Lapamine 115,254 (61,056) – 54,198

Goldexmine 125,574 (64,836) – 60,738

Meadowbankmine 575,856 (270,824) (11,199) 293,833

CanadianMalarticjointoperation(note5) 189,900 (113,916) – 75,984

Kittilamine 176,520 (116,893) – 59,627

Total Northern Business 1,491,898 (816,261) (11,199) 664,438

Southern Business:

PinosAltosmine 251,783 (123,342) – 128,441

CrestonMascotadepositatPinosAltos 59,573 (28,007) – 31,566

LaIndiamine 93,512 (36,949) – 56,563

Total Southern Business 404,868 (188,298) – 216,570

Exploration – – (44,803) (44,803)

Segments totals $ 1,896,766 $ (1,004,559) $ (56,002) $ 836,205

Totalsegmentsincome $ 836,205

Corporateandother:

Amortizationofproperty,plantandminedevelopment (433,628)

Generalandadministrative (118,771)

Impairmentlossonavailable-for-salesecurities (15,763)

Financecosts (73,393)

Lossonderivativefinancialinstruments (6,156)

Gainonsaleofavailable-for-salesecurities 5,635

Environmentalremediation (8,214)

Foreigncurrencytranslationloss (3,781)

Otherincome 7,004

Incomebeforeincomeandminingtaxes $ 189,138


Total Assets as at

December 31, 2015

December 31, 2014

Northern Business:

LaRondemine $ 834,881 $ 856,489

Lapamine 50,951 74,131

Goldexmine 201,257 205,101

Meadowbankmine 595,682 660,278

CanadianMalarticjointoperation(note5) 2,012,648 2,068,532

Meliadineproject 561,271 487,901

Kittilamine 933,362 931,335

Total Northern Business 5,190,052 5,283,767

Southern Business:

PinosAltosmine 585,735 573,786

CrestonMascotadepositatPinosAltos 70,670 84,176

LaIndiamine 501,179 543,297

Total Southern Business 1,157,584 1,201,259

Exploration 199,606 144,580

Corporate and other 135,938 179,649

Total assets $ 6,683,180 $ 6,809,255


ThefollowingtablesetsoutthechangesinthecarryingamountofgoodwillbysegmentfortheyearsendedDecember31,2014andDecember31,2015:

Meliadine Project

La India Mine

Canadian Malartic Joint

Operation

Total

Cost:

BalanceatDecember31,2013 $ 200,064 $ 39,017 $ – $ 239,081

JointacquisitionofOsisko(note5) – – 657,792 657,792

BalanceatDecember31,2014 200,064 39,017 657,792 896,873

BalanceatDecember31,2015 200,064 39,017 657,792 896,873

Accumulated impairment:

BalanceatDecember31,2014 (200,064) – – (200,064)

BalanceatDecember31,2015 (200,064) – – (200,064)

Carrying amount at December 31, 2014 $ – $ 39,017 $ 657,792 $ 696,809

Carrying amount at December 31, 2015 $ – $ 39,017 $ 657,792 $ 696,809


Thefollowingtablesetsoutcapitalexpendituresbysegment:

Capital Expenditures Year Ended December 31,

2015

2014

Northern Business:

LaRondemine $ 67,342 $ 76,651

Lapamine 6,491 20,198

Goldexmine 48,818 34,330

Meadowbankmine 65,230 65,883

CanadianMalarticjointoperation 43,368 36,083

Meliadineproject 66,747 48,270

Kittilamine 56,404 106,220

Total Northern Business 354,400 387,635

Southern Business:

PinosAltosmine 61,829 48,365

CrestonMascotadepositatPinosAltos 4,195 10,852

LaIndiamine 23,379 22,692

Total Southern Business 89,403 81,909

Corporate and other 5,955 5,868

Total capital expenditures $ 449,758 $ 475,412

Thefollowingtablesetsoutrevenuesfromminingoperationsbygeographicarea:


2015

2014

Canada $ 1,337,017 $ 1,315,378

Mexico 442,058 404,868

Finland 206,357 176,520

Total revenues from mining operations $ 1,985,432 $ 1,896,766


Thefollowingtablesetsoutnon-currentassetsbygeographicarea:

Non-current Assets as at

December 31, 2015

December 31, 2014

Canada $ 3,878,644 $ 3,954,725

Mexico 1,082,524 1,095,160

Finland 882,345 841,062

UnitedStates 10,242 10,248

Total non-current assets $ 5,853,755 $ 5,901,195

23. IMPAIRMENT LOSSES

TheCompanyperformsgoodwillimpairmenttestsonanannualbasisasatDecember31eachyear.Inaddition,theCompanyassessesforindicatorsofimpairmentateachreportingperiodendandifanindicatorofimpairmentisidentified,goodwillandnon-currentassetsaretestedforimpairmentatthattime.Ifanindicatorofimpairmentexists,therecoverableamountoftheassetiscalculatedinordertodetermineifanyimpairmentlossisrequired.Animpairmentlossisrecognizedforanyexcessofthecarryingamountoftheassetoveritsrecoverableamount.

TheestimatedrecoverableamountoftheCanadianMalarticjointoperationsegmentasatDecember31,2015andDecember31,2014wasdeterminedonthebasisoffairvaluelesscoststodisposeoftheCanadianMalarticmineaswellastheexplorationpropertiesincludedinthejointoperation.TheestimatedrecoverableamountoftheCanadianMalarticminewascalculatedbydiscountingtheestimatedfuturenetcashflowsovertheestimatedlifeofthemineusingadiscountrateof5.25%(2014–7.6%),commensuratewiththeestimatedlevelofriskassociatedwiththeCanadianMalarticmine.Therecoverableamountcalculationwasbasedonanestimateoffutureproductionlevelsapplyinggoldpricesof$1,150to$1,250perounce(inrealterms)(2014–$1,300perounce),foreignexchangeratesofUS$0.75:C$1.00toUS$0.80:C$1.00(2014–US$0.88:C$1.00toUS$0.91:C$1.00),aninflationrateof2.0%(2014–2.0%),andcapital,operatingandreclamationcostsbasedonapplicablelife-of-mineplans.Explorationpropertieswithinthejointoperationwerevaluedbyreferencetocomparablerecenttransactions.TheCanadianMalarticjointoperationsegmentestimatedrecoverableamountexceededitscarryingamountatDecember31,2015andDecember31,2014.ThediscountedcashflowapproachusessignificantunobservableinputsandisthereforeconsideredLevel3fairvaluemeasurementunderthefairvaluehierarchy.

Discountrateswerebasedoneachassetgroup'sweightedaveragecostofcapital,ofwhichthetwomaincomponentsarethecostofequityandtheafter-taxcostofdebt.Costofequitywascalculatedbasedonthecapitalassetpricingmodel,incorporatingtherisk-freerateofreturnbasedonGovernmentofCanadamarketablebondyieldsasatthevaluationdate,theCompany'sbetacoefficientadjustmenttothemarketequityriskpremiumbasedonthevolatilityoftheCompany'sreturninrelationtothatofacomparablemarketportfolio,plusasizepremiumandCompany-specificriskfactor.CostofdebtwasdeterminedbyapplyinganappropriatemarketindicationoftheCompany'sborrowingcapabilitiesandthecorporateincometaxrateapplicabletoeachassetgroup'sjurisdiction.Goldpriceestimatesweredeterminedusingforecastsoffuturepricespreparedbyindustryanalysts,whichwereavailableasatorclosetothevaluationdate.Foreignexchangeestimatesarebasedonacombinationofcurrencyforwardcurvesandestimatesthatreflecttheoutlooksofmajorglobalfinancialinstitutions.


24. INCOME AND MINING TAXES

Incomeandminingtaxesexpenseismadeupofthefollowingcomponents:


2015

2014

Currentincomeandminingtaxes $ 51,495 $ 69,110

Deferredincomeandminingtaxes:

Originationandreversaloftemporarydifferences 6,550 37,058

Totalincomeandminingtaxesexpense $ 58,045 $ 106,168

TheincomeandminingtaxesexpenseisdifferentfromtheamountthatwouldhavebeencalculatedbyapplyingtheCanadianstatutoryincometaxrateasaresultofthefollowing:


2015

2014

Combinedfederalandcompositeprovincialtaxrates 26.0% 26.0%

Expectedincometaxexpenseatstatutoryincometaxrate $ 21,442 $ 49,082

Increase(decrease)inincomeandminingtaxesresultingfrom:

Miningtaxes 19,042 28,857

Taxlawchanges 4,357 –

Impactofforeigntaxrates (8,499) (7,462)

Permanentdifferences 1,359 14,042

Impactofforeignexchangeondeferredincometaxbalances 20,344 21,649

Totalincomeandminingtaxesexpense $ 58,045 $ 106,168


ThefollowingtablesetsoutthecomponentsofAgnicoEagle'snetdeferredincomeandminingtaxliabilities:

As at December 31,

2015

As at December 31,

2014

Miningproperties $ 1,039,105 $ 1,043,811

Netoperatingandcapitallosscarryforwards (86,126) (117,995)

Miningtaxes (75,410) (54,643)

Reclamationprovisionsandotherliabilities (75,455) (73,981)

Totaldeferredincomeandminingtaxliabilities $ 802,114 $ 797,192


2015

2014

Deferredincomeandminingtaxliabilities–beginningofyear $ 797,192 $ 453,411

Incomeandminingtaximpactrecognizedinnetincome 6,025 33,884

Incometaximpactrecognizedinothercomprehensiveincome(loss) (1,103) 1,316

AttributabledeferredincomeandminingtaxliabilitiesjointlyacquiredfromOsisko – 308,581

Deferredincomeandminingtaxliabilities–endofyear $ 802,114 $ 797,192

TheCompanyoperatesindifferentjurisdictionsand,accordingly,itissubjecttoincomeandothertaxesunderthevarioustaxregimesinthecountriesinwhichitoperates.Thetaxrulesandregulationsinmanycountriesarehighlycomplexandsubjecttointerpretation.TheCompanymaybesubjectinthefuturetoareviewofitshistoricincomeandothertaxfilingsandinconnectionwithsuchreviews,disputescanarisewiththetaxingauthoritiesovertheinterpretationorapplicationofcertaintaxrulesandregulationstotheCompany'sbusinessconductedwithinthecountryinvolved.

Thedeductibletemporarydifferencesandunusedtaxlossesinrespectofwhichadeferredtaxassethasnotbeenrecognizedintheconsolidatedbalancesheetsareasfollows:

As at December 31,

2015

As at December 31,

2014

Netcapitallosscarryforwards $ 90,647 $ 83,353

Otherdeductibletemporarydifferences 213,879 204,293

Unrecognizeddeductibletemporarydifferencesandunusedtaxlosses $ 304,526 $ 287,646


TheCompanyalsohasunusedtaxcreditsof$9.9millionasatDecember31,2015(December31,2014–nil)forwhichadeferredtaxassethasnotbeenrecognized.

Capitallosscarryforwardsandotherdeductibletemporarydifferenceshavenoexpirydatewhiletheunusedtaxcreditsexpirein2020.

TheCompanyhas$412.8million(2014–$499.9million)oftaxabletemporarydifferencesassociatedwithitsinvestmentsinsubsidiariesforwhichdeferredincometaxof$2.7million(2014–$2.3million)hasnotbeenrecognized,astheCompanyisabletocontrolthetimingofthereversalofthetaxabletemporarydifferencesanditisprobablethattheywillnotreverseintheforeseeablefuture.

TheCompanyissubjecttotaxesinCanada,MexicoandFinland,eachwithvaryingstatutesoflimitations.Priortaxationyearsgenerallyremainsubjecttoexamination.

25. EMPLOYEE BENEFITS AND COMPENSATION OF KEY MANAGEMENT PERSONNEL

DuringtheyearendedDecember31,2015,employeebenefitsexpensewas$463.0million(2014–$493.3million).Therewerenorelatedpartytransactionsin2015or2014otherthancompensationofkeymanagementpersonnel.KeymanagementpersonnelincludethemembersoftheBoardandtheseniorleadershipteam.Compensationforkeymanagementpersonnelwasasfollows:

Year ended December 31,

2015

2014

Salaries,short-termincentivesandotherbenefits $ 7,428 $ 6,629

Post-employmentbenefits 611 2,009

Share-basedpayments 4,914 4,688

Total $ 12,953 $ 13,326

26. COMMITMENTS AND CONTINGENCIES

Aspartofitsongoingbusinessandoperations,theCompanyhasbeenrequiredtoprovideassuranceintheformoflettersofcreditforenvironmentalandsiterestorationcosts,customcredits,governmentgrantsandothergeneralcorporatepurposes.AsatDecember31,2015,thetotalamountoftheseguaranteeswas$268.7million.

CertainoftheCompany'spropertiesaresubjecttoroyaltyarrangements.Thefollowingarethemostsignificantroyaltyarrangements:

• TheCompanyhasaroyaltyagreementwiththeFinnishgovernmentrelatingtotheKittilamine.Starting12monthsaftertheKittilamine'soperationscommenced,theCompanyhasbeenrequiredtopay2.0%onnetsmelterreturns,definedasrevenuelessprocessingcosts.Theroyaltyispaidonanannualbasisinthefollowingyear.

• TheCompanyiscommittedtopayaroyaltyonproductionfromcertainpropertiesinQuebec,Canada.Thetypeofroyaltyagreementsinclude,butarenotlimitedto,netprofitsinterestroyaltiesandnetsmelterreturnroyalties,withpercentagesrangingfrom2.5%to5.0%.

• TheCompanyiscommittedtopayaroyaltyonproductionfromcertainpropertiesinMexico.Thetypeofroyaltyagreementsinclude,butarenotlimitedto,netprofitsinterestroyaltiesandnetsmelterreturnroyalties,withpercentagesrangingfrom0.5%to3.5%.


TheCompanyregularlyentersintovariousearn-inandshareholderagreements,oftenwithcommitmentstopaynetsmelterreturnandotherroyalties.

TheCompanyhadthefollowingpurchasecommitmentsasatDecember31,2015,ofwhich$29.3millionrelatedtocapitalexpenditures:

Purchase

Commitments

2016 $ 38,750

2017 10,556

2018 7,991

2019 5,709

2020 4,702

Thereafter 20,400

Total $ 88,108

27. SUBSEQUENT EVENTS

DividendsDeclared

OnFebruary10,2016,AgnicoEagleannouncedthattheBoardapprovedthepaymentofaquarterlycashdividendof$0.08percommonshare(atotalvalueofapproximately$17.5million),paidonMarch15,2016toholdersofrecordofthecommonsharesoftheCompanyonMarch1,2016.

Flow-throughshareprivateplacement

OnMarch10,2016,theCompanyissued374,869commonsharesunderflow-throughshareprivateplacementsfortotalproceedsofC$25.0million($18.7million).TheCompanyhasanobligationtoincurC$25.0millioninexplorationexpendituresandtorenouncesuchexpenditurestotheinvestorsoftheseflow-throughshares.

28. ONGOING LITIGATION

SecuritiesClassActionLawsuits

OnMarch8,2012andApril10,2012,aNoticeofActionandStatementofClaim(collectively,the"OntarioClaim")wereissuedbyWilliamLeslie,AFALivforsakringsaktiebolagandcertainotherentitiesagainsttheCompanyandcertainofitscurrentandformerofficers,someofwhoalsoareorweredirectorsoftheCompany.TheOntarioClaimallegedthattheCompany'spublicdisclosureconcerningwaterflowissuesattheGoldexminewasmisleading.TheOntarioClaimwasissuedbytheplaintiffsonbehalfofallpersonsandentitieswhoacquiredsecuritiesoftheCompanyduringtheperiodMarch26,2010toOctober19,2011,excludingpersonsresidentordomiciledintheProvinceofQuebecatthetimetheypurchasedoracquiredsuchsecurities.Theplaintiffssought,amongotherthings,damagesofC$250.0million.OnApril17,2013,anOrderwasgrantedonconsentcertifyingtheactionandgrantingleavefortheclaimsunderSection138oftheSecurities Act (Ontario)toproceed.

OnMarch28,2012,theCompanyandcertainofitscurrentandformerofficers,someofwhomalsoareorweredirectorsoftheCompany,werenamedasrespondentsinaMotionforLeavetoInstituteaClassActionandfortheAppointmentofa


RepresentativePlaintiff(the"QuebecMotion").Theactionwasonbehalfofallpersonsandentitieswithfewerthan50employeesresidentinQuebecwhoacquiredsecuritiesoftheCompanybetweenMarch26,2010andOctober19,2011.TheproposedclassactionwasfordamagesofC$100.0millionarisingasaresultofallegedlymisleadingdisclosurebytheCompanyconcerningitsoperationsattheGoldexmine.OnOctober1,2013,theQuebeccourtcertifiedtheclassactionontermsidenticaltothosesetoutintheconsentOrdergrantedinOntarioonApril17,2013.

SettlementofOntarioandQuebecActions

InSeptember2015,theCompanyparticipatedinamediationwiththeplaintiffsinrespectofboththeOntarioandQuebecactionsandreachedanagreementtosettletheOntarioandQuebecactionsforanaggregateofC$17.0millionwithoutanyadmissionofliability.Aspartofthesettlement,theproceedingsagainsttheCompanyandtheindividualdefendantsweredismissed.ThesettlementwasapprovedbytheOntarioandQuebeccourtsonFebruary11,2016andFebruary1,2016,respectively.TheamountofthesettlementhasbeencoveredbytheinsurerstotheCompany.AsatDecember31,2015,theCompanyrecordedC$17.0millionintheaccountspayableandaccruedliabilitieslineitemoftheconsolidatedbalancessheetstoreflectthesettlementpayment,withanequalamountrecordedintheothercurrentassetslineitemoftheconsolidatedbalancessheetstoreflecttherelatedinsurancereceivable.


QuickLinks

Exhibit99.2

REPORTOFINDEPENDENTREGISTEREDPUBLICACCOUNTINGFIRMONINTERNALCONTROLOVERFINANCIALREPORTINGMANAGEMENTCERTIFICATIONREPORTOFINDEPENDENTREGISTEREDPUBLICACCOUNTINGFIRMAGNICOEAGLEMINESLIMITEDCONSOLIDATEDBALANCESHEETS(thousandsofUnitedStatesdollars,exceptshareamounts)AGNICOEAGLEMINESLIMITEDCONSOLIDATEDSTATEMENTSOFEQUITY(thousandsofUnitedStatesdollars,exceptshareandpershareamounts)AGNICOEAGLEMINESLIMITEDCONSOLIDATEDSTATEMENTSOFCASHFLOWS(thousandsofUnitedStatesdollars)


Exhibit 99.3

Management's Discussion and Analysis(PREPAREDINACCORDANCEWITHINTERNATIONALFINANCIALREPORTINGSTANDARDS)FOR THE YEAR ENDED DECEMBER 31, 2015


MANAGEMENT'S DISCUSSION AND ANALYSIS

Table of Contents

Page ExecutiveSummary 1

Strategy 1

PortfolioOverview 2

KeyPerformanceDrivers 4

BalanceSheetReview 6

ResultsofOperations 7

RevenuesfromMiningOperations 8

ProductionCosts 9

ExplorationandCorporateDevelopmentExpense 12

AmortizationofProperty,PlantandMineDevelopment 12

GeneralandAdministrativeExpense 12

ImpairmentLossonAvailable-for-saleSecurities 13

FinanceCosts 13

ImpairmentLoss 13

ForeignCurrencyTranslation(Gain)Loss 14

IncomeandMiningTaxesExpense(Recovery) 14

LiquidityandCapitalResources 14

OperatingActivities 14

InvestingActivities 14

FinancingActivities 16

ContractualObligations 18

Off-BalanceSheetArrangements 18

2016LiquidityandCapitalResourcesAnalysis 19

QuarterlyResultsReview 19

Outlook 20

GoldProduction 20

FinancialOutlook 22

RiskProfile 24

CommodityPricesandForeignCurrencies 24

CostInputs 26

InterestRates 26

i

FinancialInstruments 26

OperationalRisk 26

RegulatoryRisk 28

ControlsEvaluation 29

OutstandingSecurities 29

Governance 29

SustainableDevelopmentManagement 29

EmployeeHealthandSafety 30

Community 30

Environment 30

InternationalFinancialReportingStandards 31

CriticalIFRSAccountingPoliciesandAccountingEstimates 31

DerivativeInstrumentsandHedgeAccounting 31

Goodwill 31

MiningProperties,PlantandEquipmentandMineDevelopmentCosts 32

DevelopmentStageExpenditures 33

ImpairmentofLong-livedAssets 34

ReclamationProvisions 34

Stock-basedCompensation 35

RevenueRecognition 36

IncomeTaxes 36

RecentlyIssuedAccountingPronouncements 37

MineralReserveData 37

Non-GAAPFinancialPerformanceMeasures 39

SummarizedQuarterlyData 50

ThreeYearFinancialandOperatingSummary 56

ThisManagement'sDiscussionandAnalysis("MD&A")datedMarch23,2016ofAgnicoEagleMinesLimited("AgnicoEagle"orthe"Company")shouldbereadinconjunctionwiththeCompany'sannualconsolidatedfinancialstatementsfortheyearendedDecember31,2015thatwerepreparedinaccordancewithInternationalFinancialReportingStandards("IFRS")asissuedbytheInternationalAccountingStandardsBoard("IASB").TheCompanyhasadoptedIFRSasitsbasisofaccounting,replacingUnitedStatesgenerallyacceptedaccountingprinciples("USGAAP")effectiveJuly1,2014.TheannualconsolidatedfinancialstatementsandthisMD&AarepresentedinUnitedStatesdollars("USdollars","$"or"US$")andallunitsofmeasurementareexpressedusingthemetricsystem,unlessotherwisespecified.CertaininformationinthisMD&AispresentedinCanadiandollars("C$"),MexicanpesosorEuropeanUnioneuros("Euro"or"€").AdditionalinformationrelatingtotheCompany,includingtheCompany'sAnnualInformationFormfortheyearendedDecember31,2015(the"AIF"),isavailableontheCanadianSecuritiesAdministrators'(the"CSA")SEDARwebsiteatwww.sedar.com.

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NOTE TO INVESTORS CONCERNING FORWARD-LOOKING INFORMATION CertainstatementsinthisMD&A,referredtohereinas"forward-lookingstatements",constitute"forward-lookinginformation"undertheprovisionsofCanadianprovincialsecuritieslawsandconstitute"forward-lookingstatements"withinthemeaningoftheUnitedStatesPrivateSecuritiesLitigationReformActof1995.Thesestatementsrelateto,amongotherthings,theCompany'splans,objectives,expectations,estimates,beliefs,strategiesandintentionsandcangenerallybeidentifiedbytheuseofwordssuchas"anticipate","believe","budget","could","estimate","expect","forecast","intend","likely","may","plan","project","schedule","should","target","will","would"orothervariationsofthesetermsorsimilarwords.Forward-lookingstatementsinthisMD&Ainclude,butarenotlimitedto,thefollowing:



• anticipatedlevelsortrendsforpricesofgoldandby-productmetalsminedbytheCompanyorforexchangeratesbetweencurrenciesinwhichcapitalisraised,revenueisgeneratedorexpensesareincurredbytheCompany;


• estimatesoffuturecosts,includingminingcosts,totalcashcostsperounce,all-insustainingcostsperounce,minesitecostspertonneandothercosts;


• statementsregardingtheprojectedexploration,developmentandexploitationofcertainoredeposits,includingestimatesofexploration,developmentandproductionandothercapitalcostsandestimatesofthetimingofsuchexploration,developmentandproductionordecisionswithrespectthereto;






• statementsregardinganticipatedlegislationandregulations,includingwithrespecttoclimatechange,andestimatesoftheimpactontheCompany;and


Forward-lookingstatementsarenecessarilybaseduponanumberoffactorsandassumptionsthat,whileconsideredreasonablebyAgnicoEagleasofthedateofsuchstatements,areinherentlysubjecttosignificantbusiness,economicandcompetitiveuncertaintiesandcontingencies.ThefactorsandassumptionsofAgnicoEagleuponwhichtheforward-lookingstatementsinthisMD&Aarebased,andwhichmayprovetobeincorrect,includetheassumptionssetoutelsewhereinthisMD&Aaswellas:thattherearenosignificantdisruptionsaffectingAgnicoEagle'soperations,whetherduetolabourdisruptions,supplydisruptions,damagetoequipment,naturalorman-madeoccurrences,miningormillingissues,politicalchanges,titleissuesorotherwise;thatpermitting,developmentandexpansionateachofAgnicoEagle'sminesandminedevelopmentprojectsproceedonabasisconsistentwithexpectations,andthatAgnicoEagledoesnotchangeitsexplorationordevelopmentplansrelatingtosuchprojects;thattheexchangeratesbetweentheCanadiandollar,Euro,MexicanpesoandtheUSdollarwillbeapproximatelyconsistentwithcurrentlevelsorassetoutinthisMD&A;thatpricesforgold,silver,zincandcopperwillbeconsistentwithAgnicoEagle'sexpectations;thatpricesforkeyminingandconstructionsupplies,includinglabourcosts,remainconsistentwithAgnicoEagle'sexpectations;thatproductionmeetsexpectations;thatAgnicoEagle'scurrentestimatesofmineralreserves,mineralresources,mineralgradesandmineralrecoveriesareaccurate;thattherearenomaterialdelaysinthetimingforcompletionofdevelopmentprojects;andthattherearenomaterialvariationsinthecurrenttaxandregulatoryenvironmentthataffectAgnicoEagle.

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Theforward-lookingstatementsinthisMD&AreflecttheCompany'sviewsasatthedateofthisMD&Aandinvolveknownandunknownrisks,uncertaintiesandotherfactorswhichcouldcausetheactualresults,performanceorachievementsoftheCompanyorindustryresultstobemateriallydifferentfromanyfutureresults,performanceorachievementsexpressedorimpliedbysuchforward-lookingstatements.Suchfactorsinclude,amongothers,theriskfactorssetoutin"RiskFactors"below.Giventheseuncertainties,readersarecautionednottoplaceunduerelianceontheseforward-lookingstatements,whichspeakonlyasofthedatemade.Exceptasotherwiserequiredbylaw,theCompanyexpresslydisclaimsanyobligationorundertakingtoreleasepubliclyanyupdatesorrevisionstoanysuchstatementstoreflectanychangeintheCompany'sexpectationsoranychangeinevents,conditionsorcircumstancesonwhichanysuchstatementisbased.ThisMD&Acontainsinformationregardingestimatedtotalcashcostsperounce,all-insustainingcostsperounceandminesitecostspertonneinrespectoftheCompanyoratcertainoftheCompany'sminesandminedevelopmentprojects.TheCompanybelievesthatthesegenerallyacceptedindustrymeasuresarerealisticindicatorsofoperatingperformanceandareusefulinallowingyearoveryearcomparisons.Investorsarecautionedthatthisinformationmaynotbesuitableforotherpurposes.

Meaningof"including"and"suchas":WhenusedinthisMD&A,theterms"including"and"suchas"meanincludingandsuchas,withoutlimitation.

NOTE TO INVESTORS CONCERNING ESTIMATES OF MINERAL RESOURCES Cautionary Note to Investors Concerning Estimates of Measured and Indicated Mineral Resources

Thisdocumentusestheterms"measuredmineralresources"and"indicatedmineralresources".InvestorsareadvisedthatwhilethesetermsarerecognizedandrequiredbyCanadianregulations,theSECdoesnotrecognizethem.Investors are cautioned not to assume that any part or allof mineral deposits in these categories will ever be converted into mineral reserves.


Thisdocumentusestheterm"inferredmineralresources".InvestorsareadvisedthatwhilethistermisrecognizedandrequiredbyCanadianregulations,theSECdoesnotrecognizeit."Inferredmineralresources"haveagreatamountofuncertaintyastotheirexistenceandastotheireconomicandlegalfeasibility.Itcannotbeassumedthatanypartorallofaninferredmineralresourcewilleverbeupgradedtoahighercategory.UnderCanadianrules,estimatesofinferredmineralresourcesmaynotformthebasisoffeasibilityorpre-feasibilitystudies,exceptinrarecases.Investors are cautioned not to assume that any part or all of an inferred mineral resource exists, or is economically or legally mineable.

NOTE TO INVESTORS CONCERNING CERTAIN MEASURES OF PERFORMANCE ThisMD&Apresentscertainmeasures,including"totalcashcostsperounce","all-insustainingcostsperounce","adjustednetincome"and"minesitecostspertonne"thatarenotrecognizedmeasuresunderIFRS.Thisdatamaynotbecomparabletodatapresentedbyothergoldproducers.ForareconciliationofthesemeasurestothemostdirectlycomparablefinancialinformationpresentedintheconsolidatedfinancialstatementspreparedinaccordancewithIFRS,seeNon-GAAP Financial Performance Measures inthisMD&A.TheCompanybelievesthatthesegenerallyacceptedindustrymeasuresarerealisticindicatorsofoperatingperformanceandareusefulinperformingyearoveryearcomparisons.However,thesenon-GAAPmeasuresshouldbeconsideredtogetherwithotherdatapreparedinaccordancewithIFRS,andthesemeasures,takenbythemselves,arenotnecessarilyindicativeofoperatingcostsorcashflowmeasurespreparedinaccordancewithIFRS.ThisMD&Aalsocontainsinformationastoestimatedfuturetotalcashcostsperounce,all-insustainingcostsperounceandminesitecostspertonne.Theestimatesoftotalcashcostsperounce,all-insustainingcostsperounceandminesitecostspertonnearebaseduponthetotalcashcostsperounce,all-insustainingcostsperounceandminesitecostspertonnethattheCompanyexpectstoincurtominegoldatitsminesandprojectsand,consistentwiththereconciliationoftheseactualcostsreferredtoabove,donotincludeproductioncostsattributabletoaccretionexpenseandotherassetretirementcosts,whichwillvaryovertimeaseachprojectisdevelopedandmined.Itisthereforenotpracticabletoreconciletheseforward-lookingnon-GAAPfinancialmeasurestothemostcomparableIFRSmeasure.

All-insustainingcostsperounceofgoldproducedispresentedonbothaby-productbasis(deductingby-productmetalrevenuesfromproductioncosts)andco-productbasis(beforeby-productmetalrevenues).All-insustainingcostsperounceofgoldproducedonaby-productbasisiscalculatedastheaggregateoftotalcashcostsperounceofgoldproducedonaby-productbasisandsustainingcapitalexpenditures(includingcapitalizedexploration),generalandadministrativeexpenses(includingstockoptions)andnon-cashreclamationprovisionexpenseperounceofgoldproduced.All-in

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sustainingcostsperounceofgoldproducedonaco-productbasisiscalculatedinthesamemannerasall-insustainingcostsperounceofgoldproducedonaby-productbasisexceptthatnoadjustmentforby-productmetalrevenuesismadetototalcashcostsperounceofgoldproduced.Thecalculationofall-insustainingcostsperounceofgoldproducedonaco-productbasisdoesnotreflectareductioninproductioncostsorsmelting,refiningandmarketingchargesassociatedwiththeproductionandsaleofby-productmetals.

All-insustainingcostsperounceisanon-IFRSmeasureandisusedtoshowthefullcostofgoldproductionfromcurrentoperations.TheCompany'smethodologyforcalculatingall-insustainingcostsperouncemaynotbesimilartothemethodologyusedbyotherproducersthatdiscloseall-insustainingcostsperounce.TheCompanymaychangethemethodologyitusestocalculateall-insustainingcostsperounceinthefuture,includinginresponsetotheadoptionofformalindustryguidanceregardingthismeasurebytheWorldGoldCouncil.

v

Executive Summary

AgnicoEagleisaseniorCanadiangoldminingcompanythathasproducedpreciousmetalssince1957.TheCompany'sminesarelocatedinCanada,MexicoandFinland,withexplorationanddevelopmentactivitiesineachoftheseregionsaswellasintheUnitedStatesandSweden.TheCompanyanditsshareholdershavefullexposuretogoldpricesduetoitslong-standingpolicyofnoforwardgoldsales.AgnicoEaglehasdeclaredacashdividendeveryyearsince1983.

AgnicoEagleearnsasignificantproportionofitsrevenueandcashflowfromtheproductionandsaleofgoldinbothdorebarandconcentrateform.Theremainderofrevenueandcashflowisgeneratedbytheproductionandsaleofby-productmetals,primarilysilver,zincandcopper.In2015,AgnicoEaglerecordedtotalcashcostsperounceofgoldproducedof$567onaby-productbasisand$626onaco-productbasisonpayablegoldproductionof1,671,340ounces.Theaveragerealizedpriceofgolddecreasedby8.3%from$1,261perouncein2014to$1,156perouncein2015.

AgnicoEagle'snineminesarelocatedinwhattheCompanybelievestobepoliticallystablecountriesthataresupportiveoftheminingindustry.ThepoliticalstabilityoftheregionsinwhichAgnicoEagleoperateshelpstoprovideconfidenceinitscurrentandfutureprospectsandprofitability.ThisisimportantforAgnicoEagleasitbelievesthatmanyofitsnewminesandrecentlyacquiredminingprojectshavelong-termminingpotential.

Highlights

• Recordannualpayablegoldproductionof1,671,340ouncesduring2015,anincreaseof16.9%comparedwith2014payablegoldproductionof1,429,288ounces.

• Totalcashcostsperounceofgoldproducedof$567onaby-productbasisand$626onaco-productbasisin2015,an11.0%and13.2%decreasecomparedwith2014,respectively.

• All-insustainingcostsperounceofgoldproducedof$810onaby-productbasisand$869onaco-productbasisin2015,a15.1%and16.3%decreasecomparedwith2014,respectively.

• Provenandprobablegoldreservestotaled19.1millionouncesatDecember31,2015,including3.9millionattributableouncesresultingfromtheJune16,2014jointacquisitionofOsiskoMiningCorporation("Osisko"),nowCanadianMalarticCorporation,comparedwith20.0millionouncesatDecember31,2014.

• OnJune9,2015,theCompanyacquired100.0%ofSoltoroLtd.("Soltoro")foratotalpurchasepriceof$26.7millioncomprisedof$2.4millionincashand770,429AgnicoEaglecommonsharesissuedfromtreasury.

• OnJune11,2015,theCompanyacquired55.0%ofGunnarnMiningAB("Gunnarn")foratotalpurchasepriceof$13.1million(includingtheassociatedexpenditurecommitment),addingthepromisingBarseleprojectinSwedentotheCompany'sportfolioofassets.

• TheCompany'soperationsarelocatedinmining-friendlyregionsthattheCompanybelieveshavelowpoliticalriskandlong-termminingpotential.

• TheCompanymaintainsasolidfinancialpositionandforecastsbeingfullyfundedforitscurrentlyplannedinvestmentinexistingmines,keyexplorationprojectsanddevelopmentpipelineadvancement.

• TheCompanyhasstrongseniormanagementcontinuityasitschiefexecutiveofficerhasover30yearsofservicewiththeCompany.

• InFebruary2016,theCompanydeclaredaquarterlycashdividendof$0.08percommonshare.AgnicoEaglehasnowdeclaredacashdividendeveryyearsince1983.

Strategy

AgnicoEagle'sabilitytoconsistentlyexecuteitsbusinessstrategyhasprovidedasolidfoundationforgrowth.

TheCompany'sgoalsareto:

• Deliverhighqualitygrowthwhilemeetingexpectationsandmaintaininghighperformance standardsinhealth,safety,environmentandcommunitydevelopment;

• Buildastrongpipeline ofprojectstodrivefutureproduction;and

• Employthebestpeople andmotivatethemtoreachtheirpotential.

MANAGEMENT'SDISCUSSIONANDANALYSISAGNICO EAGLE 1

Thesethreepillars–performance, pipeline and people –formthebasisofAgnicoEagle'ssuccessandcompetitiveadvantage.Bydeliveringonthem,theCompanystrivestocontinuetobuilditsproductionbaseandgenerateincreasedvalueforshareholders,whilemakingmeaningfulcontributionstoitsemployeesandcommunities.

Portfolio Overview

NorthernBusiness

Canada – LaRonde Mine

The100%ownedLaRondemineinnorthwesternQuebec,theCompany'sfirstmine,achievedcommercialproductionin1988.TheLaRondemineextension,theportionoftheminebelowthe245level,achievedcommercialproductioninDecember2011andisexpectedtoextendthelifeoftheminethrough2024.TheLaRondemine'sprovenandprobablemineralreserveswereapproximately3.1millionouncesatDecember31,2015.

In2015,workwascompletedontheinstallationofacoarseoreconveyorsystemthatextendsfromthe293leveloftheLaRondeminetothecrusheronthe280level.Thenewconveyorwascommissionedinthefourthquarterof2015andaneworepassandsilodesignedtofeedtheconveyorsystemisexpectedtobecommissionedinthesecondquarterof2016.ThisnewconveyorwillimproveminingflexibilityandreducecongestioninthedeeperportionsoftheLaRondemine.

Studiesareongoingtoassessthepotentialtoextendthemineralreservebaseandcarryoutminingactivitiesbetweenthe311and371levelsattheLaRondemine.TheCompanyisalsoevaluatingthepotentialtodevelopandmineBousquetZone5ontheadjoining100%ownedBousquetproperty.DewateringoftheoldpitontheBousquetpropertyisunderwayandpermitapplicationstocollectabulksampleareexpectedtobesubmittedin2016.

Canada – Lapa Mine

Commercialproductionwasachievedatthe100%ownedLapamineinnorthwesternQuebecinMay2009.TheLapamine'sprovenandprobablemineralreserveswereapproximately0.1millionouncesatDecember31,2015.Basedonthecurrentlifeofmineplan,2016isexpectedtobethelastyearoffullproductionattheLapamine.

Canada – Goldex Mine

OnOctober19,2011,theCompanysuspendedminingoperationsandgoldproductionatthe100%ownedGoldexmineinnorthwesternQuebecduetogeotechnicalconcernswiththerockabovethemininghorizon.AsofSeptember30,2011,AgnicoEaglerecordedanimpairmentlossonitsinvestmentintheGoldexmine(netofexpectedresidualvalue)anditsundergroundorestockpile.Alloftheremaining1.6millionouncesofprovenandprobablemineralreservesattheGoldexmine,otherthanorestockpiledonthesurface,werereclassifiedasmineralresources.AnenvironmentalremediationliabilitywasrecordedasofSeptember30,2011reflectinganticipatedcostsofremediation.TheGoldexmillcompletedprocessingfeedfromtheremainingGoldexExtensionZone("GEZ")surfacestockpileinOctoberof2011.OperationsintheGEZremainsuspendedindefinitely.

ExplorationdrillingcontinuedonseveralmineralizedzonesontheGoldexminepropertyneartheGEZafterminingoperationsweresuspendedinOctoberof2011.AteamofindependentconsultantsandAgnicoEaglestaffperformedathoroughreview,includingapreliminaryeconomicassessment,todeterminewhetherfutureminingoperationsontheproperty,includingtheMandEZones,wouldbeviable.Afterareviewoftheassessment,AgnicoEagle'sBoardofDirectors(the"Board")approvedtheMandEZonesfordevelopmentusingexistingGoldexmineinfrastructuresuchastheshaftandmill.CommercialproductionwasachievedattheGoldexmine'sMandEZonesinOctober2013.

AsaresultoftheCompany'srestatementofcomparativeinformationunderIFRS,a$109.7millionimpairmentlossreversalwasrecordedasattheJanuary1,2013IFRStransitiondate.Specificlong-livedassetsassociatedwiththeGEZthatwereimpairedasatSeptember30,2011duetothesuspensionofminingoperations,includingtheGoldexmine'sshaftandmill,weresubsequentlyincorporatedintothedevelopmentplanfortheGoldexmine'sMandEZones,whichwasapprovedbytheBoardinJuly2012.

In2015,rehabilitationofthesurfacerampwascompleted,whichprovidedincreasedoperationalflexibilityandaccesstotheM2andM5satelliteZonesforconversiondrillingandpotentialdevelopment.InJuly2015,theCompanyannouncedtheapprovaloftheDeep1project,whichisexpectedtobegincommissioningin2018.TheGoldexmine'sprovenandprobablemineralreserveswereapproximately0.7millionouncesatDecember31,2015.

2 AGNICO EAGLE MANAGEMENT'SDISCUSSIONANDANALYSIS

Canada – Canadian Malartic Mine

AgnicoEagleandYamanajointlyacquired100.0%ofOsiskoonJune16,2014pursuanttoacourt-approvedplanofarrangementundertheCanadaBusiness Corporations Act (the"OsiskoArrangement").AsaresultoftheOsiskoArrangement,AgnicoEagleandYamanaeachindirectlyown50.0%ofOsiskoandCanadianMalarticGP,whichnowholdstheCanadianMalarticmineinnorthwesternQuebec.AgnicoEagleandYamanawillalsojointlyexplore,throughtheirindirectownershipofCanadianMalarticCorporation(thesuccessortoOsisko),theKirklandLakeassets,theHammondReefprojectandthePandoraandWood-Pandoraproperties.

In2016,explorationprogramsareplannedtoevaluateanumberofnearopenpitandundergroundtargetsadjacenttoexistingCanadianMalarticmineinfrastructureandtofurtherdefinetheextentofthemineralizationattheOdysseyZone.PermittingactivitiesrelatedtotheBarnatextensionandthere-routingoftheadjacentHighway117areexpectedtocontinuein2016.AgnicoEagle'sattributableshareofprovenandprobablemineralreservesattheCanadianMalarticminewereapproximately3.9millionouncesatDecember31,2015.

Canada – Meadowbank Mine

In2007,theCompanyacquiredCumberlandResourcesLtd.,whichhelda100%interestintheMeadowbankgoldprojectinNunavut,Canada.CommercialproductionwasachievedbyAgnicoEagleattheMeadowbankmineinMarch2011.TheMeadowbankmine'sprovenandprobablemineralreserveswereapproximately0.9millionouncesatDecember31,2015.

The100%ownedAmaruqprojectislocatedapproximately50kilometresnorthwestoftheMeadowbankmineinNunavut,Canada.The2016drillprogramwillfocusontryingtoexpandandupgrademineralresourcesandoutlineasecondopenpitdeposit.TheCompanyhopesthatitcanpotentiallydeveloptheAmaruqprojectasasatelliteoperationtotheMeadowbankmine.Inlate2015,theCompanyreceivedapprovalfortheconstructionofanall-weatherexplorationroadlinkingtheAmaruqprojecttotheMeadowbankmine.In2016,theCompanyexpectstocarryoutadditionalengineeringworkandbeginroadpreparation.

AdecisionwasmadetoextendtheVaultpitattheMeadowbankminein2015,increasingtheexpectedminelifebyapproximatelyoneyearthrough2018,thoughdecreasingexpectedannualproduction.TheVaultpitextensionisexpectedtopartiallybridgetheproductiongapattheMeadowbankminethroughtothepotentialcommencementofdevelopmentoftheAmaruqproject.

Canada – Meliadine Project

OnJuly6,2010,AgnicoEagleacquiredits100%interestintheMeliadineprojectinNunavut,CanadathroughitsacquisitionofComaplexMineralsCorp.ActivitiesattheMeliadineprojectduring2015includedrampdevelopment,permitting,campoperationandthecompletionofanupdatedtechnicalstudy.Budgeted2016Meliadineprojectcapitalexpendituresof$96.0millionarefocusedonfurtherundergrounddevelopment,detailedengineeringandprocurement,constructionofessentialsurfaceinfrastructureandtheacquisitionofacampfacility.TheMeliadineprojecthadprovenandprobablemineralreservesofapproximately3.4millionouncesatDecember31,2015.

Finland – Kittila Mine

The100%ownedKittilamineinnorthernFinlandwasaddedtotheCompany'sportfoliothroughtheacquisitionofRiddarhyttanResourcesABin2005.ConstructionattheKittilaminewascompletedin2008andcommercialproductionwasachievedinMay2009.ProvenandprobablemineralreservesattheKittilamineamountedtoapproximately4.4millionouncesatDecember31,2015.

ThemainundergroundrampattheKittilamineisbeingextendedtoreachthedeeperportionsoftheRimpiZoneandwillprovidefurtherundergrounddrillaccesstotestforadditionaldepthextensionsoftheRimpi,Suuri,RouraandthenewlydiscoveredSisarmineralizedZones.AsurfacerampisbeingdrivenintotheRimpiZoneforproductionpurposesandtoprovideasecondegressfortheSuurirampsystem.ThissurfacerampisexpectedtoserveasthemainhaulageroutefromthedeeperportionsoftheRimpi,SuuriandSisarZones.

In2015,anewzoneofmineralizationknownastheSisarZonewasdiscoveredbyexplorationdrillingfromtheundergroundrampbeingdriventowardsthedeeperportionoftheRimpiZone.TheSisarZoneislocatedtotheeastofthemainorezoneattheKittilamineincloseproximitytoexistingundergroundinfrastructure.TheSisarZonecouldpotentiallyprovideanadditionalsourceofundergroundoretotheKittilamillwithrelativelyminimaladditionalundergrounddevelopment,shouldfurtherdrillingoutlineaneconomicdeposit.


AgnicoEagleisalsoevaluatingthepotentialoftheKuotkodeposit,locatedapproximately15kilometresnorthoftheKittilamine,asanopenpitfeedingthemillattheKittilamine.Metallurgicaltestingisongoingandstudiesarebeingcarriedouttoassesstheviabilityofminingthedeposit.

SouthernBusiness

Mexico – Pinos Altos Mine

In2006,theCompanycompletedtheacquisitionofthePinosAltosproperty,thenanadvancedstageexplorationpropertyinnorthernMexico.CommercialproductionwasachievedatthePinosAltosmineinNovember2009.ThePinosAltosmine'sprovenandprobablemineralreserveswereapproximately1.5millionouncesatDecember31,2015.

A$106.0millionshaftsinkingprojectremainsonscheduleforcompletionin2016atthePinosAltosmine.Uponcompletion,itisexpectedthatthisnewshaftwillfacilitateimprovedmatchingofminingandmillcapacityastheopenpitminingoperationwindsdown.

Mexico – Creston Mascota Deposit at Pinos Altos

The100%ownedCrestonMascotadepositatPinosAltosislocatedapproximatelysevenkilometresnorthwestofthemaindepositatthePinosAltosmineinnorthernMexico.CommercialproductionwasachievedattheCrestonMascotadepositatPinosAltosinMarch2011.Provenandprobablemineralreserveswereapproximately0.2millionouncesattheCrestonMascotadepositatPinosAltosatDecember31,2015.

In2015,workonthePhase4leachpadadvancedwithconstructionactivitiesfocusedonearthworks,drainage,peripheralroadsandwaterdiversionchannels,withprojectcompletionexpectedin2016.

Mexico – La India Mine

AgnicoEaglecompleteditsacquisitionofGraydResourceCorporation("Grayd")onJanuary23,2012.GraydownedtheLaIndiaproject,whichislocatedapproximately70kilometresnorthwestofthePinosAltosmineinnorthernMexico.InSeptember2012,developmentandconstructionoftheLaIndiaminewasapprovedbytheBoardandcommercialproductionwasachievedinFebruary2014.

In2015,constructionwascompletedontheLaIndiamine'sleachpadexpansion(earthworksandlinerinstallation)andhaulroad.PreparationactivitiesrelatedtotheMainZonepitwerealsocompleted.DrillingwasfocusedonextendingmineralizationintheMainZoneandtheLaIndiaZoneandconvertingsulfidemineralizationintomineralreservesandmineralresources.TheLaIndiamine'sprovenandprobablemineralreserveswereapproximately0.9millionouncesatDecember31,2015.

Mexico – El Barqueno Project

OnNovember28,2014,theCompanyacquiredCaydenResourcesInc.("Cayden")pursuanttoacourt-approvedplanofarrangement.Caydenholdsa100.0%interestintheMorelosSurpropertyaswellasanoptiontoacquirea100%interestintheElBarquenoproperty,bothlocatedinMexico.

TheCompanybelievesthattheElBarquenoprojectmayhavethepotentialtobedevelopedasacombinationopenpit/undergroundminewithmillandheapleachprocessingandmineralizationsimilartothePinosAltosmine.In2016,AgnicoEagleplanstocarryouta$13.0millionexplorationprogramtofurtherexpandandinfilltheknownmineralresourcebase.

Key Performance Drivers

ThekeydriversoffinancialperformanceforAgnicoEagleinclude:

• Thespotpriceofgold,silver,zincandcopper;

• Productionvolumes;

• Productioncosts;and

• Canadiandollar/USdollar,Mexicanpeso/USdollarandEuro/USdollarexchangerates.


SpotPriceofGold,Silver,ZincandCopper

Gold Prices ($ per ounce)

2015 2014 % Change Highprice $1,308 $1,392 (6.0%)

Lowprice $1,046 $1,131 (7.5%)

Averageprice $1,160 $1,266 (8.4%)

Averagepricerealized $1,156 $1,261 (8.3%)

In2015,theaveragemarketpriceperounceofgoldwas8.4%lowerthanin2014.TheCompany'saveragerealizedpriceperounceofgoldin2015was8.3%lowerthanin2014.

SILVER ($ per ounce) ZINC ($ per tonne) COPPER ($ per tonne)

Netby-product(primarilysilver,zincandcopper)revenueistreatedasareductionofproductioncostsincalculatingtotalcashcostsperounceofgoldproducedonaby-productbasis.AgnicoEagle'srealizedsalespriceforsilverdecreasedby14.4%in2015comparedwith2014whilerealizedsalespricesforzincdecreasedby15.7%andrealizedsalespricesforcopperdecreasedby23.8%overthesameperiod.Significantquantitiesofby-productmetalsareproducedbytheLaRondemine(silver,zinc,andcopper)andthePinosAltosmine(silver).

TheCompanyhasneversoldgoldforward,allowingtheCompanytotakefulladvantageofrisinggoldprices.Managementbelievesthatlowcostproductionisthebestprotectionagainstadecreaseingoldprices.

ProductionVolumesandCosts

ChangesinproductionvolumeshaveadirectimpactontheCompany'sfinancialresults.Totalpayablegoldproductionwas1,671,340ouncesin2015,anincreaseof16.9%comparedwith1,429,288ouncesin2014primarilyduetoafullyearofproductionfromtheCompany's50.0%interestintheCanadianMalarticminein2015,whichwasacquiredonJune16,2014,theachievementofcommercialproductionattheLaIndiamineinFebruary2014,anincreaseingoldgradeattheLaRondemineandanincreaseinthequantityoforemilledattheKittilaminein2015comparedwith2014.


ProductioncostsarediscussedindetailintheResults of Operations sectionbelow.

ForeignExchangeRates(RatiotoUS$)

TheexchangerateoftheCanadiandollar,MexicanpesoandEurorelativetotheUSdollarisanimportantfinancialdriverfortheCompanyforthefollowingreasons:

• AllrevenuesareearnedinUSdollars;

• AsignificantportionofoperatingcostsattheLaRonde,Lapa,Goldex,MeadowbankandCanadianMalarticminesareincurredinCanadiandollars;

• AsignificantportionofoperatingcostsatthePinosAltosmine,theCrestonMascotadepositatPinosAltosandtheLaIndiamineareincurredinMexicanpesos;and

• AsignificantportionofoperatingcostsattheKittilamineareincurredinEuros.

TheCompanymitigatespartofitsforeigncurrencyexposurebyusingcurrencyhedgingstrategies.

CANADIAN DOLLAR MEXICAN PESO EURO

Onaverage,theCanadiandollar,MexicanpesoandEuroallweakenedrelativetotheUSdollarin2015comparedwith2014,decreasingcostsdenominatedinlocalcurrencieswhentranslatedintoUSdollarsforreportingpurposes.

Balance Sheet Review

TotalassetsatDecember31,2015of$6,683.2millionwerecomparablewithDecember31,2014totalassetsof$6,809.3million.Ofthetotal$2,229.2millionincreaseintotalassetsbetweentheDecember31,2013balanceof$4,580.1millionandDecember31,2014,$2,110.4millionrelatedtotheCompany'sJune16,2014acquisitionofits50%interestinOsiskoand$125.3millionrelatedtotheNovember28,2014acquisitionofCayden.

Cashandcashequivalentswere$124.2millionatDecember31,2015,adecreaseof$53.4millioncomparedwithDecember31,2014,primarilyduetoanet$261.1millionrepaymentoflong-termdebt,$449.8millionincapitalexpendituresand$59.5millionindividendspaidduring2015,partiallyoffsetbycashprovidedbyoperatingactivitiesof$616.2million,netproceedsfromthesaleofavailable-for-salesecuritiesandwarrantsof$61.1millionandtheissuanceofa$50.0millionnote.

Restrictedcashdecreasedby$52.6millionbetweenDecember31,2014andDecember31,2015,primarilyduetothetransferofcashfromarestrictedtrustaccounttoaCanadianMalarticCorporationcashaccount,thereleaseoffundsfromtheCompany'squalifiedenvironmentaltrustthatwassetupforcostsrelatedtotheenvironmentalremediationoftheGoldexmineandthereleaseof$10.1millionheldbyadepositaryinrelationtotheearlysettlementoftheseniorunsecuredconvertibledebentures(the"CMGPConvertibleDebentures")previouslyissuedbyOsiskoandassumedbyCanadianMalarticGP.

Inventoryoforeinstockpilesandonleachpadsdecreasedby$25.6millionto$26.3millionatDecember31,2015primarilyduetoupdatedminesequencingplansattheKittilaandCanadianMalarticminesresultinginthereclassificationoforestockpilesfromshort-termtolong-term.Suppliesinventorydecreasedby$18.1millionfrom$282.8millionatDecember31,2014to$264.7millionatDecember31,2015primarilyduetolowerfuelinventoryattheMeadowbankmine.Concentratesanddorebarinventoriesincreasedby$59.1millionto$171.0millionatDecember31,2015primarilyduetoabuildupofconcentratesanddorebarinventoriesattheCanadianMalarticmineasmillthroughputisincreasedtowardanticipatedcapacityandtoplannedminesequencingresultinginthebuildupofconcentratesanddorebarinventoriesatthePinosAltosandLaIndiamines.Non-currentoreinstockpilesincreasedby$36.0millionto$61.2millionatDecember31,2015


comparedwithDecember31,2014duetoupdatedminesequencingplansattheKittilaandCanadianMalarticminesresultinginthereclassificationoforestockpilesfromshort-termtolong-term.

Available-for-salesecuritiesdecreasedfrom$56.5millionatDecember31,2014to$31.9millionatDecember31,2015primarilydueto$29.8millionindisposals,$12.0millioninimpairmentlossesand$7.7millioninunrealizedfairvaluelosses,partiallyoffsetby$24.8millioninnewinvestmentsduring2015.

Property,plantandminedevelopmentdecreasedby$66.9millionto$5,089.0millionatDecember31,2015comparedwithDecember31,2014primarilyduetoamortizationexpenseof$608.6millionduring2015.Thiswaspartiallyoffsetbya$449.8millionincreaseinproperty,plantandminedevelopmentrelatedtocapitalexpendituresandpropertyacquisitionstotaling$67.5millionduring2015.

Totalliabilitiesdecreasedto$2,542.2millionatDecember31,2015from$2,740.8millionatDecember31,2014dueprimarilytoanet$235.0millionrepaymentundertheCompany's$1.2billionunsecuredrevolvingcreditfacility(the"CreditFacility")during2015andthesettlementoftheCMGPConvertibleDebenturesissuedbyOsiskoandassumedbyCanadianMalarticGP,partiallyoffsetbyincreasesinaccountspayableandaccruedliabilitiesandreclamationprovisionsduring2015.Ofthetotal$878.1millionincreaseintotalliabilitiesbetweentheDecember31,2013balanceof$1,862.7millionandDecember31,2014,$526.7millionrelatedtotheCompany'sJune16,2014jointacquisitionofOsiskoand$335.1millionrelatedtoincreasedlong-termdebtduring2014.

Accountspayableandaccruedliabilitiesincreasedby$33.9millionbetweenDecember31,2014andDecember31,2015primarilyduetoa$12.3millionsecuritiesclassactionlawsuitsettlementagreementthatwaspaidbytheCompany'sinsurersandtheadditionof$19.1millionforaccountspayablerelatedtofuelpurchasesfortheMeadowbankmineatDecember31,2015.

Long-termdebtdecreasedby$242.0millionbetweenDecember31,2014andDecember31,2015primarilydueto$235.0millioninnetCreditFacilityrepaymentsandtheearlysettlementoftheCMGPConvertibleDebentureswithaprincipaloutstandingofC$37.5million(theCompany'sattributable50%share)previouslyissuedbyOsiskoandassumedbyCanadianMalarticGP,partiallyoffsetbytheclosingofa$50.0millionguaranteedseniorunsecurednote.

AgnicoEagle'sreclamationprovisionincreasedby$25.9millionbetweenDecember31,2014andDecember31,2015primarilyduetothere-measurementoftheCompany'sreclamationprovisionsbyapplyingupdatedexpectedcashflowsandassumptionsasatDecember31,2015.

CertainpreviouslyreportedAgnicoEagleconsolidatedbalancesheetlineitemsasatDecember31,2014wereupdatedtoreflectadjustedfinalestimatesofthefairvalueofidentifiableassetsacquiredandliabilitiesassumedrelatedtotheJune16,2014jointacquisitionofOsisko.AsaresultofnewinformationobtainedaboutthefactsandcircumstancesthatexistedasoftheOsiskoacquisitiondate,thefollowingadjustmentswererecordedtoboththeadjustedfinalpurchasepriceallocationandtheDecember31,2014balancesheetaspreviouslyreported:thegoodwilllineitem(notdeductiblefortaxpurposes)increasedby$114.3million;theproperty,plantandminedevelopmentlineitemdecreasedby$145.6millionandthedeferredincomeandminingtaxliabilitieslineitemdecreasedby$35.0million.

FairValueofDerivativeFinancialInstruments

TheCompanyoccasionallyentersintocontractstolimittheriskassociatedwithdecreasedby-productmetalprices,increasedforeigncurrencycosts(includingcapitalexpenditures)andinputcosts.Thecontractsactaseconomichedgesofunderlyingexposuresandarenotheldforspeculativepurposes.AgnicoEagledoesnotusecomplexderivativecontractstohedgeexposures.ThefairvalueoftheCompany'sderivativefinancialinstrumentsisoutlinedinthederivativefinancialinstrumentsnotetotheannualconsolidatedfinancialstatements.

Results of Operations

AgnicoEaglereportednetincomeof$24.6million,or$0.11pershare,in2015comparedwithnetincomeof$83.0million,or$0.43pershare,in2014.In2013,theCompanyreportedanetlossof$686.7million,or$3.97pershare.AgnicoEaglereportedbasicadjustednetincomeof$93.0million,or$0.43pershare,in2015comparedwithbasicadjustednetincomeof$144.3million,or$0.74pershare,in2014.In2013,theCompanyreportedbasicadjustednetincomeof$187.6million,or$1.09pershare.In2015,theoperatingmargin(revenuesfromminingoperationslessproductioncosts)increasedto$990.1millionfrom$892.2millionin2014.In2013,operatingmarginwas$772.3million.


RevenuesfromMiningOperations

Revenuesfromminingoperationsincreasedby$88.6million,or4.7%,to$1,985.4millionin2015from$1,896.8millionin2014primarilyduetoincreasedgoldandsilverproduction,partiallyoffsetbylowersalespricesrealizedongoldandsilver.Revenuesfromminingoperationswere$1,638.4millionin2013.

Salesofpreciousmetals(goldandsilver)accountedfor99.7%ofrevenuesfromminingoperationsin2015,upfrom98.6%in2014and97.7%in2013.Theincreaseinthepercentageofrevenuesfrompreciousmetalscomparedwith2014isprimarilyduetoincreasedgoldandsilverproduction,partiallyoffsetbylowersalespricesrealizedongoldandsilveranddecreasedzincproduction.Revenuesfromminingoperationsareaccountedfornetofrelatedsmelting,refining,transportationandothercharges.

Thetablebelowsetsoutrevenuesfromminingoperations,productionvolumesandsalesvolumesbymetal:

2015 2014 2013

(thousands of United States dollars) Revenuesfromminingoperations:

Gold $ 1,911,500 $ 1,807,927 $ 1,500,354

Silver 66,991 62,466 100,895

Zinc 505 9,901 16,685

Copper 6,436 16,479 20,653

Lead(i) – (7) (181)

Totalrevenuesfromminingoperations $ 1,985,432 $ 1,896,766 $ 1,638,406

Payableproduction(ii):

Gold(ounces) 1,671,340 1,429,288 1,099,335

Silver(thousandsofounces) 4,258 3,564 4,623

Zinc(tonnes) 3,501 10,515 19,814

Copper(tonnes) 4,941 4,997 4,835

Payablemetalsold:

Gold(ounces) 1,645,081 1,425,338 1,098,382

Silver(thousandsofounces) 4,184 3,633 4,694

Zinc(tonnes) 3,596 10,535 20,432

Copper(tonnes) 4,947 5,003 4,838

Notes:

(i) Leadconcentraterevenuesofnilmillionin2015(2014–$0.1million;2013–$0.9million)arenettedagainstdirectfeesofnil(2014–$0.1million;2013–$1.1million).Othermetalrevenuesderivedfromleadconcentratein2015includedgoldrevenueofnil(2014–nil;2013–$7.9million)andsilverrevenueofnil(2014–nil;2013–$2.8million).Othermetalrevenuesderivedfromleadconcentrateareincludedintheirrespectivemetalcategoriesintheabovetable.

(ii) Payableproduction(anon-GAAPnon-financialperformancemeasure)isthequantityofmineralproducedduringaperiodcontainedinproductsthatareorwillbesoldbytheCompany,whethersuchproductsaresoldduringtheperiodorheldasinventoriesattheendoftheperiod.

Revenuesfromgoldsalesincreasedby$103.6millionor5.7%in2015comparedwith2014.Goldproductionincreasedby242,052ounces,or16.9%to1,671,340ouncesin2015from1,429,288ouncesin2014primarilydueto142,801attributableouncesofadditionalproductionfromtheCanadianMalarticminereflectingafullyearofattributableproductionafterhavingacquiredaninterestonJune16,2014,29,269ouncesofadditionalproductionfromtheLaIndiaminereflectingafullyearofproductionin2015afterhavingachievedcommercialproductioninFebruary2014,increasedgoldgradeandmillrecoveryratesattheLaRonde,Goldex,andPinosAltosminesanda26.6%increaseintonnesprocessed


attheKittilamine.PartiallyoffsettingtheoverallincreaseingoldproductionweredecreasedgoldgradeandmillrecoveryratesattheMeadowbankminein2015comparedwith2014.AgnicoEagle'saveragerealizedgoldpricedecreasedby$105or8.3%,to$1,156perouncein2015from$1,261perouncein2014.

Revenuesfromsilversalesincreasedby$4.5millionor7.2%in2015comparedwith2014.Silverproductionincreasedby19.5%toapproximately4,258,000ouncesprimarilyduetoincreasedsilvergradeatthePinosAltosmine,partiallyoffsetbylowersilvergradeandsilvermillrecoveriesattheLarondemine.AgnicoEagle'saveragerealizedsilverpricedecreasedby14.4%to$15.63perouncein2015from$18.27perouncein2014.Revenuesfromzincsalesdecreasedby$9.4millionor94.9%to$0.5millionin2015comparedwith2014primarilyduetolowerzincgradeandmillrecoveryratesattheLaRondemine,anda15.7%decreaseintherealizedzincpricebetweenperiods.Revenuesfromcoppersalesdecreasedby$10.0millionor60.9%in2015comparedwith2014primarilyduetoa23.8%declineintherealizedcopperpriceandan11.4%increaseindirectfeesbetweenperiods.

ProductionCosts

Productioncostsdecreasedto$995.3millionin2015comparedwith$1,004.6millionin2014primarilyduetotheimpactofaweakerCanadiandollar,MexicanpesoandEurorelativetotheUSdollar.Partiallyoffsettingtheoveralldecreasewas$57.6millioninadditionalattributableproductioncostsfromtheacquiredinterestintheCanadianMalarticmineand$12.6millioninadditionalproductioncostsfromtheLaIndiamine.Productioncostswere$866.1millionin2013.

Thetablebelowsetsoutproductioncostsbymine:

2015 2014 2013

(thousands of United States dollars) LaRondemine $ 172,283 $ 188,736 $ 228,640

Lapamine 52,571 61,056 69,371

Goldexmine 61,278 64,836 15,339

Meadowbankmine 230,564 270,824 318,414

CanadianMalarticmine 171,473 113,916 –

Kittilamine 126,095 116,893 97,934

PinosAltosmine 105,175 123,342 116,959

CrestonMascotadepositatPinosAltos 26,278 28,007 19,425

LaIndiamine 49,578 36,949 –

Totalproductioncosts $ 995,295 $ 1,004,559 $ 866,082

Thediscussionofproductioncostsbelowrefersto"totalcashcostsperounceofgoldproduced"and"minesitecostspertonne",neitherofwhicharerecognizedmeasuresunderIFRS.ForareconciliationofthesemeasurestoproductioncostsandadiscussionoftheirusebytheCompany,seeNon-GAAP Financial Performance Measures inthisMD&A.

ProductioncostsattheLaRondeminewere$172.3millionin2015,a8.7%decreasecomparedwith2014productioncostsof$188.7million,primarilyduetoaweakerCanadiandollarrelativetotheUSdollarbetweenperiods.During2015,theLaRondemineprocessedanaverageof6,141tonnesoforeperdaycomparedwith5,713tonnesoforeperdayduring2014.Theincreaseinthroughputbetweenperiodswasprimarilyduetoaplanned2014shutdownfortheinstallationofreplacementhoistdrivesatthePennashaft.MinesitecostspertonneremainedunchangedatC$99between2014and2015.

ProductioncostsattheLapaminewere$52.6millionin2015,a13.9%decreasecomparedwith2014productioncostsof$61.1million,primarilyduetoaweakerCanadiandollarrelativetotheUSdollarbetweenperiods.During2015,theLapamineprocessedanaverageof1,534tonnesoforeperdaycomparedwith1,750tonnesoforeperdayprocessedduring2014.Thedecreaseinthroughputisconsistentwiththemineplanastonnageisexpectedtodeclineprogressively.MinesitecostspertonneincreasedtoC$117in2015comparedwithC$107in2014,primarilyduetolowerthroughput.


ProductioncostsattheGoldexminewere$61.3millionin2015,a5.5%decreasecomparedwith2014productioncostsof$64.8million,primarilyduetoaweakerCanadiandollarrelativetotheUSdollarbetweenperiods.During2015,theGoldexmineprocessedanaverageof6,336tonnesoforeperdaycomparedwith5,799tonnesoforeperdayprocessedduring2014.Theincreaseinthroughputbetweenperiodswasprimarilyduetoplannedincreasedstopeavailability.MinesitecostspertonneremainedunchangedatC$33between2014and2015.

ProductioncostsattheMeadowbankminewere$230.6millionin2015,a14.9%decreasecomparedwith2014productioncostsof$270.8millionprimarilyduetoaweakerCanadiandollarrelativetotheUSdollarandcostreductionsbetweenperiods.During2015,theMeadowbankmineprocessedanaverageof11,049tonnesoforeperdaycomparedwith11,313tonnesoforeperdayprocessedduring2014.MinesitecostspertonnedecreasedtoC$70in2015comparedwithC$73in2014,primarilyduetooverallproductivitygainsandimprovedcostcontrols.

AttributableproductioncostsattheCanadianMalarticminewere$171.5millionin2015comparedwith$113.9millionin2014,reflectingafullyearofattributableproductioncostsin2015afterhavingacquiredanindirect50.0%interestintheCanadianMalarticmineonJune16,2014.During2015,theCanadianMalarticmineprocessedanaverageof26,150attributabletonnesoforeperdayandminesitecostspertonnewereC$23.

ProductioncostsattheKittilaminewere$126.1millionin2015,anincreaseof7.9%comparedwith2014productioncostsof$116.9millionprimarilyduetoincreasedthroughput.During2015,theKittilamineprocessedanaverageof4,011tonnesoforeperday,anincreaseof26.6%comparedwiththe3,168tonnesoforeperdayprocessedduring2014primarilyduetothecompletionofthemillexpansioninSeptember2014.Minesitecostspertonnedecreasedto€76in2015comparedwith€78in2014primarilyduetoincreasedthroughput.

ProductioncostsatthePinosAltosminewere$105.2millionin2015,adecreaseof14.7%comparedwith2014productioncostsof$123.3millionprimarilyduetoaweakerMexicanpesorelativetotheUSdollarbetweenperiods.During2015,thePinosAltosminemillprocessedanaverageof5,462tonnesoforeperday,anincreaseof2.1%comparedwiththe5,350tonnesoforeperdayprocessedduring2014.In2015,approximately384,700tonnesoforewerestackedonthePinosAltosmineleachpad,adecreaseof32.1%comparedwiththeapproximate567,800tonnesoforestackedin2014primarilyduetominesequencing.Minesitecostspertonnedecreasedto$45in2015comparedwith$48in2014primarilyduetoaweakerMexicanpesorelativetotheUSdollarbetweenperiods,partiallyoffsetbyfewertonnesoforestackedontheheapleachpad.

ProductioncostsattheCrestonMascotadepositatPinosAltoswere$26.3millionin2015,adecreaseof6.2%comparedwith2014productioncostsof$28.0million,primarilyduetoaweakerMexicanpesorelativetotheUSdollarbetweenperiods.During2015,approximately2,098,800tonnesoforewerestackedontheleachpadattheCrestonMascotadepositatPinosAltos,anincreaseof17.0%comparedwiththeapproximate1,793,800tonnesoforestackedin2014.Minesitecostspertonnedecreasedto$12in2015comparedwith$16in2014primarilyduetoaweakerMexicanpesorelativetotheUSdollarbetweenperiods.

ProductioncostsattheLaIndiaminewere$49.6millionin2015comparedwith$36.9millionin2014,reflectingafullyearofproductionattheLaIndiaminein2015afterhavingachievedcommercialproductioninFebruary2014.During2015,theLaIndiaminestackedapproximately5,371,400tonnesoforeontheleachpadandminesitecostspertonnewere$9.

Total Production Costs by Category


TotalcashcostsperounceofgoldproducedispresentedinthisMD&Aonbothaby-productbasis(deductingby-productmetalrevenuesfromproductioncosts)andco-productbasis(beforeby-productmetalrevenues).Totalcashcostsperounceofgoldproducedonaby-productbasisiscalculatedbyadjustingproductioncostsasrecordedintheconsolidatedstatementsofincomeandcomprehensiveincomeforby-productrevenues,unsoldconcentrateinventoryproductioncosts,smelting,refiningandmarketingchargesandotheradjustments,andthendividingbythenumberofouncesofgoldproduced.Totalcashcostsperounceofgoldproducedonaco-productbasisiscalculatedinthesamemannerastotalcashcostsperounceofgoldproducedonaby-productbasisexceptthatnoadjustmentforby-productmetalrevenuesismade.Accordingly,thecalculationoftotalcashcostsperounceofgoldproducedonaco-productbasisdoesnotreflectareductioninproductioncostsorsmelting,refiningandmarketingchargesassociatedwiththeproductionandsaleofby-productmetals.

Totalcashcostsperounceofgoldproducedonaby-productbasis,representingtheweightedaverageofalloftheCompany'sproducingmines,decreasedto$567in2015comparedwith$637in2014and$648in2013.Totalcashcostsperounceofgoldproducedonaco-productbasisdecreasedto$626in2015comparedwith$721in2014and$806in2013.SetoutbelowisananalysisofthechangeintotalcashcostsperounceateachoftheCompany'sminingoperations:

• AttheLaRondemine,totalcashcostsperounceofgoldproducedonaby-productbasisdecreasedto$590in2015comparedwith$668in2014primarilyduetoa30.9%increaseingoldproductionandaweakerCanadiandollarrelativetotheUSdollarbetweenperiods.Partiallyoffsettingtheoveralldecreaseintotalcashcostsperounceofgoldproducedonaby-productbasis,by-productrevenuewassignificantlylowerin2015.Lowerby-productrevenuesweretheresultoftheLaRondeminetransitioningtooresourcedfromlowerlevels,whichhaslowerby-productmetalcontent,andlowersilverandcoppersalespricesrealizedin2015comparedwith2014.Totalcashcostsperounceofgoldproducedonaco-productbasisdecreasedto$760in2015comparedwith$1,055in2014,reflectingtheincreaseingoldproductionandcostsnotedabove.

• AttheLapamine,totalcashcostsperounceofgoldproducedonaby-productbasisdecreasedto$590in2015comparedwith$667in2014.ThisdecreasewasprimarilyduetoaweakerCanadiandollarrelativetotheUSdollarbetweenperiods,partiallyoffsetbya1.8%decreaseingoldproduction.Totalcashcostsperounceofgoldproducedonaco-productbasisdecreasedto$591in2015comparedwith$667in2014asaresultofthesamefactorsasnotedabove.

• AttheGoldexmine,totalcashcostsperounceofgoldproducedonaby-productbasisdecreasedto$538in2015comparedwith$638in2014.Thisdecreasewasprimarilyduetoa14.9%increaseingoldproductionandaweakerCanadiandollarrelativetotheUSdollarbetweenperiods.Totalcashcostsperounceofgoldproducedonaco-productbasisdecreasedto$538in2015comparedwith$638in2014asaresultofthesamefactorsasnotedabove.

• AttheMeadowbankmine,totalcashcostsperounceofgoldproducedonaby-productbasisincreasedto$613in2015comparedwith$599in2014.Thisincreasewasprimarilyduetoa15.7%decreaseingoldproduction,partiallyoffsetbyaweakerCanadiandollarrelativetotheUSdollarbetweenperiods.Totalcashcostsperounceofgoldproducedonaco-productbasisincreasedto$623in2015comparedwith$604in2014asaresultofthesamefactorsasnotedabove.

• Totalcashcostsperounceofgoldproducedonaby-productbasisattheCanadianMalarticminedecreasedto$596in2015comparedwith$701duringtheJune16,2014toDecember31,2014period,primarilyduetoaweakerCanadiandollarrelativetotheUSdollarbetweenperiods.Attributabletotalcashcostsperounceofgoldproducedonaco-productbasisdecreasedto$613in2015comparedwith$721duringtheJune16,2014toDecember31,2014period,asaresultofthesamefactorsasnotedabove.TheCanadianMalarticminewasjointlyacquiredbyAgnicoEagleandYamanaonJune16,2014.

• AttheKittilamine,totalcashcostsperounceofgoldproducedonaby-productbasisdecreasedto$709in2015comparedwith$845in2014.Thisdecreasewasprimarilyduetoa25.1%increaseingoldproductionandhighercostsin2014associatedwiththemillexpansion.Totalcashcostsperounceofgoldproducedonaco-productbasisdecreasedto$710in2015comparedwith$846in2014asaresultofthesamefactorsasnotedabove.

• Totalcashcostsperounceofgoldproducedonaby-productbasisatthePinosAltosminedecreasedto$387in2015comparedwith$533in2014.Thisdecreasewasprimarilyduetoa12.8%increaseingoldproductionandaweakerMexicanpesorelativetotheUSdollarbetweenperiods.Totalcashcostsperounceofgoldproducedonaco-productbasisdecreasedto$578in2015comparedwith$718in2014asaresultofthesamefactorsasnotedabove.


• Totalcashcostsperounceofgoldproducedonaby-productbasisattheCrestonMascotadepositatPinosAltosdecreasedto$430in2015comparedwith$578in2014.Thisdecreasewasprimarilyduetoa14.3%increaseingoldproductionandaweakerMexicanpesorelativetotheUSdollarbetweenperiods.Totalcashcostsperounceofgoldproducedonaco-productbasisdecreasedto$474in2015comparedwith$611in2014asaresultofthesamefactorsasnotedabove.

• Totalcashcostsperounceofgoldproducedonaby-productbasisattheLaIndiaminedecreasedto$436in2015comparedwith$487in2014.ThisdecreasewasdueprimarilyaweakerMexicanpesorelativetotheUSdollarbetweenperiods.Totalcashcostsperounceofgoldproducedonaco-productbasisdecreasedto$475in2015comparedwith$532in2014asaresultofthesamefactorsasnotedabove.CommercialproductionwasachievedattheLaIndiamineinFebruary2014.

ExplorationandCorporateDevelopmentExpense

Explorationandcorporatedevelopmentexpenseincreasedby97.1%to$110.4millionin2015from$56.0millionin2014.Explorationandcorporatedevelopmentexpensewas$44.2millionin2013.

AsummaryoftheCompany'ssignificant2015explorationandcorporatedevelopmentactivitiesissetoutbelow:

• InCanada,explorationexpensesincreasedby102.0%to$56.1millionin2015comparedwith2014primarilyduetoincreasedexplorationattheAmaruqprojectattheMeadowbankmineinNunavut.

• Explorationexpensesincreasedby218.3%to$25.5millioninLatinAmericacomparedwith2014primarilyduetoincreasedexplorationattheElBarquenoprojectinMexico.

• Explorationexpensesincreasedby40.2%to$3.7millionintheUnitedStatesanddecreasedby21.8%to$3.9millioninEuropein2015comparedwith2014.

• TheCompany'scorporatedevelopmentteamremainedactivein2015,completingtheacquisitionofSoltoroandtheacquisitionof55%ofGunnarnduringtheyear.

Thetablebelowsetsoutexplorationexpensebyregionandtotalcorporatedevelopmentexpense:

2015 2014 2013 (thousands of United States dollars) Canada $ 56,099 $ 27,773 $ 20,339

LatinAmerica 25,483 8,006 7,311

UnitedStates 3,666 2,615 3,501

Europe 3,943 5,044 4,624

Corporatedevelopmentexpense 21,162 12,564 8,461

Totalexplorationandcorporatedevelopmentexpense $ 110,353 $ 56,002 $ 44,236

AmortizationofProperty,PlantandMineDevelopment

Amortizationofproperty,plantandminedevelopmentexpenseincreasedto$608.6millionin2015comparedwith$433.6millionin2014and$313.9millionin2013.Theincreaseinamortizationofproperty,plantandminedevelopmentbetween2014and2015wasprimarilyduetotheconsolidationforafullyearoftheacquiredinterestintheCanadianMalarticmineandtheincreasetoitsdepreciableminingpropertiesbetweenperiods(duetothefinalizationofrelatedacquisitiondatefairvalueestimates)alongwitharampupingoldproductionattheLaIndiamine.Amortizationexpensecommencesonceoperationsareincommercialproduction.

GeneralandAdministrativeExpense

Generalandadministrativeexpensedecreasedto$97.0millionin2015from$118.8millionin2014.Thedecreasewasprimarilyduetonon-recurringtransactioncostsof$16.7millionassociatedwiththejointacquisitionofOsiskoincurredin


2014,decreasedstockcompensationexpenseandadecreaseinconsultingcostsbetweenperiods.Generalandadministrativeexpensewere$113.8millionin2013.

ImpairmentLossonAvailable-for-saleSecurities

Impairmentlossonavailable-for-salesecuritieswas$12.0millionin2015comparedwith$15.8millionin2014and$32.5millionin2013.Impairmentlossevaluationsofavailable-for-salesecuritiesarebasedonwhetheradeclineinfairvalueisconsideredtobesignificantorprolonged.

FinanceCosts

Financecostsincreasedto$75.2millionin2015comparedwith$73.4millionin2014and$62.5millionin2013.Thetablebelowsetsoutthecomponentsoffinancecosts:

2015 2014 2013 (thousands of United States dollars) Stand-byfeesoncreditfacilities $ 4,025 $ 4,605 $ 4,946

Amortizationofcreditfacilities,financingandnoteissuancecosts 2,437 2,757 3,192

InterestonCreditFacility 8,892 7,499 1,999

Interestonnotes 49,937 49,414 49,414

Accretionexpenseonreclamationprovisions 4,164 5,173 4,456

Otherinterestandpenalties 7,476 5,651 1,966

Interestcapitalizedtoconstructioninprogress (1,703) (1,706) (3,518)

Totalfinancecosts $ 75,228 $ 73,393 $ 62,455

SeeLiquidity and Capital Resources – Financing Activities inthisMD&AfordetailsontheCreditFacilityandnotesreferencedabove.

ImpairmentLoss

AttheendofeachreportingperiodtheCompanyassesseswhetherthereisanyindicationthatlong-livedassetsmaybeimpaired.Ifanindicatorofimpairmentexists,therecoverableamountoftheassetiscalculatedinordertodetermineifanyimpairmentlossisrequired.Animpairmentlossisrecognizedforanyexcessofthecarryingamountoftheassetoveritsrecoverableamount.Therecoverableamountsarebasedoneachasset'sfuturecashflowsandrepresentseachasset'sfairvaluelesscostsofdisposal.

BasedonassessmentscompletedbytheCompany,noimpairmentlosseswererequiredin2015or2014.AsatDecember31,2013,theCompanyidentifiedthecontinueddeclineinthemarketpriceofgoldasanindicatorofpotentialimpairmentfortheCompany'slong-livedassets.Asaresultoftheidentificationofthisindicator,theCompanyestimatedtherecoverableamountsofallcashgeneratingunits("CGUs")usingupdatedassumptionsandestimatesandconcludedthateachoftheLapamine,MeadowbankmineandMeliadineprojectwereimpaired.

Adiscountedcashflowapproachwasusedtoestimatefairvaluelesscostsofdisposal,whichrepresentstherecoverableamountofproperty,plantandminedevelopmentassetsthatwasusedtodeterminetheimpairmentlossamounts.ThetotalimpairmentlossrecordedduringtheyearendedDecember31,2013was$1,014.7million.

Management'sestimatesoffuturenetcashflowsaresubjecttoriskanduncertainties.Therefore,itisreasonablypossiblethatchangescouldoccurwhichmayaffecttherecoverabilityoftheCompany'slong-livedassetsandgoodwill.ThismayhaveamaterialeffectontheCompany'sfutureconsolidatedfinancialstatements.


ForeignCurrencyTranslation(Gain)Loss

TheCompany'soperatingresultsandcashflowaresignificantlyaffectedbychangesintheexchangeratebetweentheUSdollarandeachoftheCanadiandollar,MexicanpesoandEuroasalloftheCompany'srevenuesareearnedinUSdollarswhileasignificantportionofitsoperatingandcapitalcostsareincurredinsuchothercurrencies.DuringtheperiodfromJanuary1,2014throughDecember31,2015,thedailyUSdollar(noon)exchangerateasreportedbytheBankofCanadahasfluctuatedbetweenC$1.06andC$1.40,12.85Mexicanpesosand17.36Mexicanpesosand€0.72and€0.95perUS$1.00.

Aforeigncurrencytranslationgainof$4.7millionwasrecordedin2015comparedwithforeigncurrencytranslationlossesof$3.8millionin2014and$1.8millionin2013.Onaverage,theUSdollarstrengthenedagainsttheCanadiandollar,MexicanpesoandEuroin2015comparedwith2014.TheUSdollaralsostrengthenedagainsttheCanadiandollar,MexicanpesoandEurobetweenDecember31,2014andDecember31,2015.Thenetforeigncurrencytranslationgainin2015wasprimarilyduetothetranslationimpactofcurrentliabilitiesdenominatedinCanadiandollars,MexicanpesosandEuros,offsetpartiallybythetranslationimpactofcurrentassetsdenominatedinMexicanpesos,CanadiandollarsandEuros.

IncomeandMiningTaxesExpense(Recovery)

In2015,theCompanyrecordedincomeandminingtaxesexpenseof$58.0milliononincomebeforeincomeandminingtaxesof$82.6millionataneffectivetaxrateof70.2%.In2014,theCompanyrecordedincomeandminingtaxesexpenseof$106.2milliononincomebeforeincomeandminingtaxesof$189.1millionataneffectivetaxrateof56.1%.TheCompany's2015and2014effectivetaxrateswerehigherthantheapplicablestatutorytaxrateof26.0%primarilyduetotheimpactofminingtaxes,foreignexchangeandnon-deductiblepermanentdifferences.In2013,anincomeandminingtaxesrecoveryof$131.6millionwasrecordedonalossbeforeincomeandminingtaxesof$818.3millionprimarilyduetoimpairmentlossesrecordedontheMeliadineproject,theMeadowbankmineandtheLapamineasatDecember31,2013.In2013,incomeandminingtaxeswerealsoaffectedbynon-deductiblepermanentdifferencesandadeferredtaxchargerelatingtothe2013enactmentoftheSpecialMiningDutyinMexico.

Liquidity and Capital Resources

AtDecember31,2015,theCompany'scashandcashequivalents,short-terminvestmentsandcurrentrestrictedcashtotaled$132.3million,comparedwith$215.3millionatDecember31,2014.TheCompany'spolicyistoinvestexcesscashinhighlyliquidinvestmentsofthehighestcreditqualitytoeliminaterisksassociatedwiththeseinvestments.Suchinvestmentswithremainingmaturitiesatthetimeofpurchasegreaterthanthreemonthsareclassifiedasshort-terminvestments.Decisionsregardingthelengthofmaturitiesarebasedoncashflowrequirements,ratesofreturnandotherfactors.

Workingcapital(currentassetslesscurrentliabilities)decreasedto$517.9millionatDecember31,2015from$575.7millionatDecember31,2014.

OperatingActivities

Cashprovidedbyoperatingactivitiesdecreasedby$52.1millionto$616.2millionin2015comparedwith2014.Thedecreaseincashprovidedbyoperatingactivitieswasprimarilyduetodecreasesintheaveragerealizedpriceofallmetalsanda$54.4millionincreaseinexplorationandcorporatedevelopmentexpensesbetween2014and2015,partiallyoffsetbya16.9%increaseingoldproduction,a19.5%increaseinsilverproduction,a$21.8milliondecreaseingeneralandadministrativeexpensesandtheimpactofaweakerCanadiandollar,MexicanpesoandEurorelativetotheUSdollaroncostsbetweenperiods.Cashprovidedbyoperatingactivitieswas$481.0millionin2013,$187.3millionlowerthanin2014primarilyduetoa30.0%increaseingoldproductionin2014comparedwith2013.

InvestingActivities

Cashusedininvestingactivitiesdecreasedto$374.5millionin2015from$851.6millionin2014.Thedecreaseincashusedininvestingactivitieswasprimarilydueto$403.5millioninnetcashexpendituresassociatedwiththeCompany'sJune16,2014jointacquisitionofOsisko,a$41.0millionincrementaldecreaseinrestrictedcash,a$25.7milliondecreaseincapitalexpenditures,a$16.4millionincreaseinnetproceedsfromthesaleofavailable-for-salesecuritiesandwarrantsanda$7.4milliondecreaseinpurchasesofavailable-for-salesecuritiesandwarrantsbetweenperiods.Cashusedininvestingactivitieswas$687.2millionin2013,includingcapitalexpendituresof$620.5million,$59.8millioninpurchasesofavailable-for-salesecuritiesandwarrantsand$10.1millionassociatedwiththeacquisitionofUrastarGoldCorporation.


In2015,theCompanyinvestedcashof$449.8millioninprojectsandsustainingcapitalexpenditures.Capitalexpendituresin2015included$67.3millionattheLaRondemine,$66.7millionattheMeliadineproject,$65.2millionattheMeadowbankmine,$61.8millionatthePinosAltosmine,$56.4millionattheKittilamina,$48.8millionattheGoldexmine,$43.4millionattheCanadianMalarticmine(theCompany'sattributableportion),$23.4millionattheLaIndiamine,$6.5millionattheLapamine,$4.2millionattheCrestonMascotadepositatPinosAltosand$6.1millionatotherprojects.The$25.7milliondecreaseincapitalexpendituresbetween2014and2015wasprimarilyduetosignificantexpendituresthatwereincurredin2014relatingtotheKittilamine'smillexpansionprojectandtheLaRondemine'scoarseoreconveyorandventilationsystems,inadditiontothewind-downofcapitalexpendituresattheLapaminebetweenperiodsasitapproachestheendofitsplannedminelife.Partiallyoffsettingtheoveralldecreaseincapitalexpendituresbetween2014and2015wereincreaseddevelopmentexpendituresattheMeliadineprojectandattheGoldexandPinosAltosminesandanincreaseinattributablecapitalexpendituresrelatedtotheCanadianMalarticminewhichwasjointlyacquiredonJune16,2014.

OnJune11,2015,AgnicoEagleSwedenAB("AESweden"),anindirectwholly-ownedsubsidiaryoftheCompany,acquired55.0%oftheissuedandoutstandingcommonsharesofGunnarnMiningAB("Gunnarn")fromOrexMineralsInc.("Orex"),bywayofasharepurchaseagreement(the"GunnarnSPA").TheoperationandgovernanceofGunnarnandtheBarseleprojectaregovernedbyajointventureagreementamongtheCompany,AESweden,OrexandGunnarn(the"GunnarnJVA").UndertheGunnarnSPA,theconsiderationfortheacquisitionofthe55.0%ofGunnarn'soutstandingcommonshareswas$10.0million,comprisedof$6.0millionincashpayableatclosingandpaymentsof$2.0millionincashor,atAESweden'ssolediscretion,sharesoftheCompany,oneachofthefirstandsecondanniversaryoftheclosing.UndertheGunnarnJVA,AESwedencommittedtoincuranaggregateof$7.0millionofexplorationexpensesattheBarseleprojectbyJune11,2018,45.0%or$3.1millionofwhichisconsideredaccruedpurchaseconsideration.Accordingly,theCompany'stotalpurchaseconsiderationfortheacquisitionofits55.0%interestinGunnarnwas$13.1million.AESwedenmayearnanadditional15.0%interestinGunnarnundertheGunnarnJVAifitcompletesafeasibilitystudyinrespectoftheBarseleproject.TheGunnarnJVAalsoprovidesAESwedenwiththerighttonominateamajorityofthemembersoftheboardofdirectorsofGunnarn(basedoncurrentshareholdings)andAESwedenisthesoleoperatoroftheBarseleprojectandpaidcustomarymanagementfees.Inconnectionwiththetransaction,Orexalsoobtaineda2.0%netsmelterreturnroyaltyonproductionfromtheBarseleproperty,whichtheCompanymayrepurchaseatanytimefor$5.0million.TheGunnarnacquisitionwasaccountedforbytheCompanyasanassetacquisitionandtransactioncostsassociatedwiththeacquisitiontotaling$0.6millionwerecapitalizedtotheminingpropertiesacquired.OnSeptember25,2015,OrexMineralsInc.assigneditsinterestintheGunnarnJVAgreementtoBarseleMineralsCorp.("BarseleMinerals"),whichwasatthetimeawholly-ownedsubsidiaryofOrex.AllofthesharesofBarseleMineralsweresubsequentlydistributedtoshareholdersofOrexunderaplanofarrangement.

OnJune9,2015,theCompanyacquiredalloftheissuedandoutstandingcommonsharesofSoltoroLtd.("Soltoro"),includingcommonsharesissuableontheexerciseofSoltoro'soutstandingoptionsandwarrants,bywayofaplanofarrangementundertheCanada Business CorporationsAct (the"SoltoroArrangement").EachoutstandingshareofSoltorowasexchangedundertheSoltoroArrangementfor:(i)C$0.01incash;(ii)0.00793ofanAgnicoEaglecommonshare;and(iii)onecommonshareofPalaminaCorp.,acompanythatwasnewlyformedinconnectionwiththeSoltoroArrangement.PursuanttotheSoltoroArrangement,SoltorotransferredallminingpropertieslocatedoutsideofthestateofJalisco,MexicotoPalaminaCorp.andretainedallotherminingproperties.AgnicoEaglehadnointerestinPalaminaCorp.upontheclosingoftheSoltoroArrangement.AgnicoEagle'stotalpurchasepriceof$26.7millionwascomprisedof$2.4millionincash,including$1.6millionincashcontributedtoPalaminaCorp.,and770,429AgnicoEaglecommonsharesissuedfromtreasury.TheSoltoroacquisitionwasaccountedforasanassetacquisitionandtransactioncostsassociatedwiththeacquisitiontotaling$1.4millionwerecapitalizedtotheminingpropertiesacquired.

OnMay21,2015,theCompanysubscribedfor62,500,000commonsharesofBeloSunMiningCorp.("BeloSun")inanon-brokeredprivateplacementatapriceofC$0.24perBeloSuncommonshare,fortotalcashconsiderationofC$15.0million.Uponclosingthetransaction,theCompanyheldapproximately17.4%oftheissuedandoutstandingcommonsharesofBeloSun.

OnMarch19,2015,AgnicoEagle,YamanaandCanadianMalarticGPcompletedthepurchaseofa30.0%interestintheMalarticCHLpropertyfromAbitibiRoyaltiesInc.("Abitibi")inexchangefor459,197AgnicoEaglecommonshares,3,549,695Yamanacommonsharesand3.0%netsmelterreturnroyaltiestoeachofAbitibiandOsiskoGoldRoyaltiesLtd.ontheMalarticCHLproperty.TotalAgnicoEaglecommonshareconsiderationissuedwasvaluedat$13.4millionbasedontheclosingpriceofthecommonsharesonMarch18,2015.TheMalarticCHLpropertyislocatedadjacenttotheCompany'sjointlyownedCanadianMalarticmineandtheremaining70.0%interestintheMalarticCHLpropertywasjointlyacquired


throughtheJune16,2014acquisitionofOsisko(thepredecessortoCanadianMalarticCorporation).Concurrentwiththetransactionclosing,eachofAbitibi,AgnicoEagle,Yamana,CanadianMalarticGPandCanadianMalarticCorporationreleasedanddischargedtheotherswithrespecttoallproceedingspreviouslycommencedbyAbitibiwithrespecttotheMalarticCHLproperty.Asaresultofthetransaction,AgnicoEagleandYamanajointlyowna100.0%interestintheMalarticCHLpropertythroughtheirrespectiveindirectinterestsinCanadianMalarticGP.

OnNovember28,2014,theCompanyacquiredalloftheissuedandoutstandingcommonsharesofCayden,includingcommonsharesissuableontheexerciseofCayden'soutstandingoptionsandwarrants,pursuanttoacourt-approvedplanofarrangement.Thetotalpurchasepriceof$122.1millionwascomprisedof$0.5millionincashand4,853,875AgnicoEaglecommonsharesissuedfromtreasury.TheCaydenacquisitionwasaccountedforasanassetacquisitionandtransactioncostsassociatedwiththeacquisitiontotaling$3.2millionwerecapitalizedtotheminingpropertiesacquired.

OnJune16,2014,AgnicoEagleandYamanajointlyacquired100.0%ofOsiskobywayoftheOsiskoArrangement.AsaresultoftheOsiskoArrangement,AgnicoEagleandYamanaeachindirectlyown50.0%ofOsiskoandCanadianMalarticGP,whichnowholdstheCanadianMalarticmine.AgnicoEagleandYamanawillalsojointlyexploreotherpropertiesthatwereheldbyOsisko(nowCanadianMalarticCorporation)atthetimeofacquisition.AgnicoEaglehasrecognizeditsinterestintheassets,liabilities,revenuesandexpensesofOsiskoinaccordancewiththeCompany'srightsandobligationsprescribedbytheOsiskoArrangementunderIFRS.AgnicoEagle'sshareofOsisko'sJune16,2014purchasepricewascomprisedofcashpaymentstotaling$462.7millionand33,923,212AgnicoEaglecommonsharesvaluedat$1,135.1million.

In2015,theCompanyreceivednetproceedsof$61.1millionfromthesaleofavailable-for-salesecuritiesandwarrantscomparedwith$44.7millionin2014and$0.2millionin2013.In2015,theCompanypurchased$19.8millionofavailable-for-salesecuritiesandwarrantscomparedwith$27.2millionin2014and$59.8millionin2013.TheCompany'sinvestmentsinavailable-for-salesecuritiesconsistprimarilyofinvestmentsincommonsharesofentitiesintheminingindustry.

FinancingActivities

Cashusedinfinancingactivitiesof$280.8millionin2015comparedwithcashprovidedbyfinancingactivities$229.2millionin2014primarilyduetoachangefromnetproceedsfromlong-termdebtof$286.0millionin2014toa$261.1millionnetrepaymentoflong-termdebtin2015,partiallyoffsetbytheissuanceofthe$50.0million2015Note(asdefinedbelow)onSeptember30,2015.Cashprovidedbyfinancingactivitieswas$48.7millionin2013,whichincludednetproceedsfromlong-termdebtof$170.0million,partiallyoffsetbydividendspaidof$126.3million.

In2015,theCompanypaiddividendsof$59.5millioncomparedwith$54.1millionin2014and$126.3millionin2013.AgnicoEaglehasdeclaredacashdividendeveryyearsince1983.AlthoughtheCompanyexpectstocontinuepayingdividends,futuredividendswillbeatthediscretionoftheBoardandwillbesubjecttofactorssuchasincome,financialconditionandcapitalrequirements.

OnSeptember30,2015,theCompanyamendedits$1.2billionCreditFacility,amongotherthings,extendingthematuritydatefromJune22,2019toJune22,2020andamendingpricingterms.AsatDecember31,2015,theCompany'soutstandingbalanceundertheCreditFacilitywas$265.0million.CreditFacilityavailabilityisreducedbyoutstandinglettersofcredit,amountingto$10.9millionatDecember31,2015.AsatDecember31,2015,$924.1millionwasavailableforfuturedrawdownundertheCreditFacility.

OnSeptember30,2015,theCompanyclosedaprivateplacementconsistingofa$50.0millionguaranteedseniorunsecurednote(the"2015Note")withaSeptember30,2025maturitydateandayieldof4.15%.Underthenotepurchaseagreementinrespectofthe2015Note,theCompanyagreedthatanamountequaltoorgreaterthanthenetproceedsfromthe2015NotewouldbespentonminingprojectsintheProvinceofQuebec,Canada.

OnSeptember23,2015,theCompanyenteredintoastandbyletterofcreditfacilitywithafinancialinstitutionprovidingforafurtherC$150.0millionuncommittedletterofcreditfacility(asamended,the"NewLCFacility").TheNewLCFacilitymaybeusedbytheCompanytosupportthereclamationobligationsoftheCompany,itssubsidiariesoranyentityinwhichtheCompanyhasadirectorindirectinterestortheperformanceobligations(otherthanwithrespecttoindebtednessforborrowedmoney)oftheCompany,itssubsidiariesoranyentityinwhichtheCompanyhasadirectorindirectinterestthatarenotdirectlyrelatedtoreclamationobligations.PaymentandperformanceoftheCompany'sobligationsundertheNewLCFacilityaresupportedbyguaranteesissuedbyExportDevelopmentCanadaunderacontractinsurancebondingprogramagreement(the"EDCFacility")infavourofthelender.AsatDecember31,2015,$69.8millionhadbeendrawnundertheNewLCFacility.


OnJuly31,2015,theCompanyamendeditscreditagreementwithanotherfinancialinstitutionrelatingtoitsuncommittedletterofcreditfacility(asamended,the"ExistingLCFacility").TheamountavailableundertheExistingLCFacilityincreasedfromC$175.0milliontoC$200.0million.EffectiveSeptember28,2015,theamountavailableundertheExistingLCFacilitywasincreasedtoC$250.0million.TheobligationsoftheCompanyundertheExistingLCFacilityareguaranteedbycertainofitssubsidiaries.TheExistingLCFacilitymaybeusedtosupportthereclamationobligationsornon-financialorperformanceobligationsoftheCompanyoritssubsidiaries.AsatDecember31,2015,$172.6millionhadbeendrawnundertheExistingLCFacility.

OnJuly24,2012,theCompanyclosedaprivateplacementconsistingof$200.0millionofguaranteedseniorunsecurednotes(the"2012Notes").The2012Notesmaturein2022and2024andatissuancehadaweightedaveragematurityof11.0yearsandweightedaverageyieldof4.95%.Proceedsfromthe2012NoteswereusedtorepayamountsoutstandingundertheCreditFacility.

OnApril7,2010,theCompanyclosedaprivateplacementconsistingof$600.0millionofguaranteedseniorunsecurednotesduein2017,2020and2022(the"2010Notes")withaweightedaveragematurityof9.84yearsandweightedaverageyieldof6.59%.Proceedsfromtheofferingofthe2010NoteswereusedtorepayamountsundertheCompany'sthenoutstandingcreditfacilities.

InconnectionwithitsjointacquisitionofOsiskoonJune16,2014,CanadianMalarticGPwasassignedandassumedcertainoutstandingdebtandfinanceleaseobligationsofOsiskorelatingtotheCanadianMalarticmine.AgnicoEagle'sindirectattributableinterestinsuchdebtandfinanceleaseobligationsisassetoutbelow:

• AsecuredloanfacilityintheprincipalamountofC$75.0million($69.1million)withscheduledC$20.0millionrepaymentsonJune30,2016andJune30,2017anda6.875%perannuminterestrate.AscheduledrepaymentofC$15.0million($14.1million)wasmadesubsequenttotheJune16,2014acquisitiondateandthescheduledC$20.0million($16.0million)repaymentwasmadeonJune30,2015,resultinginattributableoutstandingprincipalof$28.9millionasatDecember31,2015.OnSeptember29,2014,CanadianMalarticGPamendedtheacquiredsecuredloanfacility(the"CMGPLoan")withnochangetomaturityorpricingterms.

• TheCMGPConvertibleDebentureswithprincipaloutstandingofC$37.5million($34.6million),aNovember2017maturitydateanda6.875%interestrate.AsattheJune16,2014Osiskoacquisitiondate,theCMGPConvertibleDebentureshadanattributablefairvalueof$44.9million.OnJune30,2015,thenegotiatedearlysettlementofalloftheCMGPConvertibleDebentureswascompleted.Asaresultofthissettlement,871,680AgnicoEaglecommonshareswithafairvalueof$24.8millionwerereleasedfromadepositarytotheholdersoftheCMGPConvertibleDebenturesalongwithacashpaymentof$10.1milliontosettletheCompany'sobligation.Additionalcashconsiderationof$3.2millionwaspaidtotheholdersoftheCMGPConvertibleDebenturesuponsettlementandwasrecordedintheotherexpenses(income)lineitemoftheconsolidatedstatementsofincomeandcomprehensiveincome.In2015,a$2.4millionmark-to-marketlosswasrecordedintheotherexpenses(income)lineitemoftheconsolidatedstatementsofincomeandcomprehensiveincomerelatedtotheCMGPConvertibleDebentures.An$8.0millionmark-to-marketgainwasrecordedintheotherexpenses(income)lineitemoftheconsolidatedstatementsofincomeandcomprehensiveincomerelatedtotheCMGPConvertibleDebenturesbetweentheJune16,2014jointacquisitiondateandDecember31,2014.AsatDecember31,2015,theCMGPConvertibleDebentureshadprincipaloutstandingofnil.

• AloanwithprincipaloutstandingofC$2.1million($2.0million)withmonthlyrepaymentsscheduledthroughthefirstquarterof2015anda0.0%interestrate.AsatDecember31,2015,theCompany'sattributableloanprincipaloutstandingwasnil.

• SecuredfinanceleaseobligationsofC$38.3million($35.3million)providedinseparatetrancheswithmaturitiesrangingbetween2015and2019anda7.5%interestrate.AsatDecember31,2015,theCompany'sattributablefinanceleaseobligationswere$13.7million.

TheCompanywasincompliancewithallcovenantscontainedintheCreditFacility,2015Note,2012Notes,2010Notes,ExistingLCFacility,NewLCFacilityandtheEDCFacilityasatDecember31,2015.CanadianMalarticGPwasincompliancewithallcovenantsundertheCMGPLoanasatDecember31,2015.

TheCompanyissuedcommonsharesundertheCompany'sincentivesharepurchaseplananddividendreinvestmentplanforgrossproceedsof$9.4millionin2015comparedwith$10.4millionin2014and$15.7millionin2013.


ContractualObligations

AgnicoEagle'scontractualobligationsasatDecember31,2015aresetoutbelow:

Total 2016 2017-2018 2019-2020 Thereafter (millions of United States dollars) Reclamationprovisions(i) $ 397.3 $ 6.2 $ 13.5 $ 22.5 $ 355.1

Purchasecommitments(ii) 88.1 38.8 18.5 10.4 20.4

Pensionobligations(iii) 5.7 0.1 0.2 1.6 3.8

Financeandoperatingleases 35.9 11.4 10.1 4.1 10.3

Long-termdebt(iv) 1,143.9 14.5 129.4 625.0 375.0

Total(v) $ 1,670.9 $ 71.0 $ 171.7 $ 663.6 $ 764.6

Notes:

(i) Miningoperationsaresubjecttoenvironmentalregulationsthatrequirecompaniestoreclaimandremediatelanddisturbedbyminingoperations.TheCompanyhassubmittedclosureplanstotheappropriategovernmentalagencieswhichestimatethenature,extentandcostsofreclamationforeachofitsminingproperties.Expectedreclamationcashflowsarepresentedaboveonanundiscountedbasis.ReclamationprovisionsrecordedintheCompany'sconsolidatedfinancialstatementsaremeasuredattheexpectedvalueoffuturecashflowsdiscountedtotheirpresentvalueusingarisk-freeinterestrate.

(ii) Purchasecommitmentsincludecontractualcommitmentsfortheacquisitionofproperty,plantandminedevelopmentandintangibleassets.AgnicoEagle'sattributableinterestinthepurchasecommitmentsassociatedwithitsjointoperationstotaled$2.6millionasatDecember31,2015.

(iii) AgnicoEagleprovidesanon-registeredsupplementaryexecutiveretirementdefinedbenefitplanforcertaincurrentandformerseniorofficers(the"ExecutivesPlan").TheExecutivesPlanbenefitsaregenerallybasedontheemployee'syearsofserviceandlevelofcompensation.Thefigurespresentedinthistablehavebeenactuariallydetermined.

(iv) WithrespecttotheCompany'slong-termdebtobligations,theCompanyhasassumedthatrepaymentwilloccuroneachinstrument'srespectivematuritydate.

(v) TheCompany'sfutureoperatingcashflowsareexpectedtobesufficienttosatisfyitscontractualobligations.

Off-BalanceSheetArrangements

TheCompany'soff-balancesheetarrangementsasatDecember31,2015includeoperatingleaseswithvariouscounterpartiesof$16.7million(seeNote14(b)totheconsolidatedfinancialstatements)andoutstandinglettersofcreditforenvironmentalandsiterestorationcosts,customcredits,governmentgrantsandothergeneralcorporatepurposesof$268.7millionundertheExistingLCFacilityandNewLCFacility(seeNote26totheconsolidatedfinancialstatements).IftheCompanyweretoterminatetheseoff-balancesheetarrangements,theCompany'sliquidityposition(asoutlinedinthetablebelow)issufficienttosatisfyanyrelatedpenaltiesorobligations.


2016LiquidityandCapitalResourcesAnalysis

TheCompanybelievesthatithassufficientcapitalresourcestosatisfyits2016mandatoryexpenditurecommitments(includingthecontractualobligationssetoutabove)anddiscretionaryexpenditurecommitments.Thefollowingtablesetsoutexpectedcapitalrequirementsandresourcesfor2016:

Amount

(millions of United States

dollars)

2016MandatoryCommitments:

Contractualobligations(seetableabove) $ 71.0

Accountspayableandaccruedliabilities(asatDecember31,2015) 243.8

Interestpayable(asatDecember31,2015) 14.5

Incometaxespayable(asatDecember31,2015) 14.9

Total2016mandatoryexpenditurecommitments $ 344.2

2016DiscretionaryCommitments:

Expected2016capitalexpenditures $ 491.0

Expected2016explorationandcorporatedevelopmentexpenses 138.0

Total2016discretionaryexpenditurecommitments $ 629.0

Total 2016 mandatory and discretionary expenditure commitments $ 973.2

2016CapitalResources:

Cash,cashequivalentsandshort-terminvestments(asatDecember31,2015) $ 131.6

Expected2016cashprovidedbyoperatingactivities 423.5

Workingcapital,excludingcash,cashequivalentsandshort-terminvestments(asatDecember31,2015) 386.3

AvailableundertheCreditFacility(asatDecember31,2015) 924.1

Total 2016 Capital Resources $ 1,865.5

WhiletheCompanybelievesitscapitalresourceswillbesufficienttosatisfyall2016commitments(mandatoryanddiscretionary),theCompanymaychoosetodecreasecertainofitsdiscretionaryexpenditurecommitments,whichincludescertaincapitalexpenditures,shouldunexpectedfinancialcircumstancesariseinthefuture.TheCompanybelievesthatitwillcontinuetohavesufficientcapitalresourcesavailabletosatisfyitsplanneddevelopmentandgrowthactivities.

Quarterly Results Review

FortheCompany'sdetailed2015and2014quarterlyfinancialandoperatingresultsseeSummarized Quarterly Data inthisMD&A.

Revenuesfromminingoperationsdecreasedby4.0%to$482.9millioninthefourthquarterof2015comparedwith$503.1millioninthefourthquarterof2014primarilyduetolowersalespricesrealizedongoldandsilver,partiallyoffsetbya9.0%increaseinpayablegoldproductionbetweenperiods.Productioncostsdecreasedby20.0%to$229.8millioninthefourthquarterof2015comparedwith$287.3millioninthefourthquarterof2014primarilyduetotheimpactofaweakerCanadiandollar,MexicanpesoandEurorelativetotheUSdollarbetweenperiods.Explorationandcorporatedevelopmentexpensesincreasedby$11.6millionto$26.0millioninthefourthquarterof2015comparedwith$14.4millioninthefourthquarterof2014primarilyduetoexplorationexpensesincurredattheElBarquenoprojectinMexicoandtheAmaruqprojectattheMeadowbankMineinNunavut.Amortizationofproperty,plantandminedevelopmentincreasedby13.0%to$157.1millioninthefourthquarterof2015comparedwith$139.1millioninthefourthquarterof2014primarilyduetoincreasedgoldproductionattheMeadowbankandLaRondeminesandanincreaseindepreciableminingpropertiesatthe


CanadianMalarticminebetweenperiodsbasedonfinalestimatesoffairvalueasattheJune16,2014acquisitiondate.Anetlossof$15.5millionwasrecordedinthefourthquarterof2015afterincomeandminingtaxesexpenseof$34.6millioncomparedwithanetlossof$21.3millioninthefourthquarterof2014afterincomeandminingtaxesexpenseof$23.6million.

Cashprovidedbyoperatingactivitiesdecreasedby14.2%to$140.7millioninthefourthquarterof2015comparedwith$164.0millioninthefourthquarterof2014.Thedecreaseincashprovidedbyoperatingactivitieswasprimarilyduetodecreasesintheaveragerealizedpriceofgoldandsilverandan$11.6millionincreaseinexplorationandcorporatedevelopmentexpenses,partiallyoffsetbya9.0%increaseinpayablegoldproductionanda$57.5milliondecreaseinproductioncostsbetweenperiods.

Outlook

Thefollowingsectioncontains"forward-lookingstatements"and"forward-lookinginformation"withinthemeaningofapplicablesecuritieslaws.PleaseseeNote to Investors Concerning Forward-Looking Information inthisMD&Aforadiscussionofassumptionsandrisksrelatingtosuchstatementsandinformation.

GoldProduction

LaRonde Mine

In2016,payablegoldproductionattheLaRondemineisexpectedtobeapproximately275,000ounces.Overthe2016to2018period,averageannualpayablegoldproductionattheLaRondemineisexpectedtobeapproximately323,000ounces.ThecommissioningofacoolingplantattheLaRondeminehashelpedtoenhanceproductivitybyreducingheatandcongestioninthelowersectionofthemineandprovidesadditionalflexibilityintheminingplan.Inaddition,anewcourseoreconveyorsystemthatisscheduledtobefullycommissionedin2016isexpectedtofurtherenhanceflexibilityinthelowersectionofthemine.Totalcashcostsperounceofgoldproducedonaby-productbasisattheLaRondemineareexpectedtobeapproximately$592in2016comparedwith$590in2015.

Lapa Mine

In2016,payablegoldproductionattheLapamineisexpectedtobeapproximately60,000ounces.2016isthefinalyearofproductionbasedontheLapamine'scurrentlifeofmineplanwithproductionexpectedtodeclineprogressivelyduetolowertonnageandstopeavailability.TheCompanyexpectsthattheLapaminewilloperateuntilearlyinthefourthquarterof2016.Totalcashcostsperounceofgoldproducedonaby-productbasisattheLapamineareexpectedtobeapproximately$640in2016comparedwith$590in2015,reflectingexpectationsofdecreasedproductionandlowergoldgrade.

Goldex Mine

TheGoldexmineachievedcommercialproductionfromtheMandEZonesinOctober2013.In2016,payablegoldproductionattheGoldexmineisexpectedtobeapproximately105,000ounces.Overthe2016to2018period,averageannualpayablegoldproductionattheGoldexmineisexpectedtobeapproximately117,000ounces.ContinuedexploitationoftheM3andM4ZonesisexpectedtomaintainrelativelyconstantproductionlevelsandcostsattheGoldexminethrough2017.Additionally,inJuly2015,theCompanyannouncedapprovaloftheDeep1project,withcommissioningexpectedtobegincommissioningin2018.Totalcashcostsperounceofgoldproducedonaby-productbasisattheGoldexmineareexpectedtobeapproximately$601in2016comparedwith$538in2015,reflectingexpectationsofdecreasedproduction.

Meadowbank Mine

In2016,payablegoldproductionattheMeadowbankmineisexpectedtobeapproximately305,000ounces.Overthe2016to2018period,averageannualpayablegoldproductionattheMeadowbankmineisexpectedtobeapproximately260,000ounces.In2015,theCompanydeterminedtoextendtheVaultpitatMeadowbank,whichresultedindecreasedproductionfor2016,butaddedapproximatelyanotheryearofproduction,throughthethirdquarterof2018.Productionlevelsareexpectedtodecreaseprogressivelythrough2018duetoadeclineingoldgradeasthecurrentmineralreservebaseisdepleted.Totalcashcostsperounceofgoldproducedonaby-productbasisattheMeadowbankmineareexpectedtobeapproximately$750in2016comparedwith$613in2015,reflectingexpectationsofdecreasedproductionandlowergoldgrade.


Canadian Malartic Mine

TheCanadianMalarticminewasjointlyacquiredbyAgnicoEagleandYamanaonJune16,2014.In2016,attributablepayablegoldproductionattheCanadianMalarticmineisexpectedtobeapproximately280,000ounces.Overthe2016to2018period,averageannualattributablepayablegoldproductionattheCanadianMalarticmineisexpectedtobeapproximately293,000ounces.Theincreaseinthroughputto55,000tonnesperdayin2016remainscontingentuponupdatingtheexistingoperatingpermits.Totalcashcostsperounceofgoldproducedonaby-productbasisattheCanadianMalarticmineareexpectedtobeapproximately$593in2016comparedwith$596in2015.

Kittila Mine

In2016,payablegoldproductionattheKittilamineisexpectedtobeapproximately200,000ounces.Overthe2016to2018period,averageannualpayablegoldproductionattheKittilamineisexpectedtobeapproximately197,000ounces.During2015,thefocusatKittilawasimprovingmillreliability,andseveralprojectswerecarriedoutthatimprovedmaintenanceperformance.Withfurtheroptimization,theCompanybelievesthereispotentialforimprovedmillavailability,whichcouldleadtohigherthroughputlevelsinthefuture.Aspartofaninitiativetoincreaseminethroughput,developmentofarampsystemrelatedtotheRimpiZonewillbeprioritized.Totalcashcostsperounceofgoldproducedonaby-productbasisattheKittilamineareexpectedtobeapproximately$646in2016comparedwith$709in2015,reflectingexpectationsofincreasedproduction.

Pinos Altos Mine

In2016,payablegoldproductionatthePinosAltosmineisexpectedtobeapproximately175,000ounces.Overthe2016to2018period,averageannualpayablegoldproductionatthePinosAltosmineisexpectedtobeapproximately177,000ounces.CommissioningofthePinosAltosshaftin2016isexpectedtoallowforbettermatchingofthefutureminingcapacitywiththemill,oncetheopenpitminingoperationbeginstowinddown.Totalcashcostsperounceofgoldproducedonaby-productbasisatthePinosAltosmineareexpectedtobeapproximately$443in2016comparedwith$387in2015,reflectingexpectationsofdecreasedproduction.

Creston Mascota deposit at Pinos Altos

In2016,payablegoldproductionattheCrestonMascotadepositatPinosAltosisexpectedtobeapproximately45,000ounces.Overthe2016to2018period,averageannualpayablegoldproductionattheCrestonMascotadepositatPinosAltosisexpectedtobeapproximately42,000ounces.FurtherdrillingontheBravodepositisplannedfor2016toevaluateitasapotentialsourceoffutureadditionalproduction.Totalcashcostsperounceofgoldproducedonaby-productbasisattheCrestonMascotadepositatPinosAltosareexpectedtobeapproximately$604in2016comparedwith$430in2015,reflectingexpectationsofdecreasedproduction.

La India Mine

TheLaIndiamineachievedcommercialproductioninFebruary2014.In2016,payablegoldproductionattheLaIndiamineisexpectedtobeapproximately100,000ounces.Overthe2016to2018period,averageannualpayablegoldproductionattheLaIndiamineisexpectedtobeapproximately107,000ounces.Totalcashcostsperounceofgoldproducedonaby-productbasisattheLaIndiamineareexpectedtobeapproximately$470in2016comparedwith$436in2015.

Production Summary

WiththeachievementofcommercialproductionattheKittila,LapaandPinosAltosminesin2009,theMeadowbankminein2010,theCrestonMascotadepositatPinosAltosandLaRondemineextensionin2011,theGoldexmineMandEZonesin2013andtheLaIndiaminein2014,alongwiththejointacquisitionoftheCanadianMalarticmineonJune16,2014,AgnicoEaglehastransformedfromaonemineoperationtoaneightmineseniorgoldminingcompanyoverthelastsevenyears.In2015,theCompanyachievedrecordannualpayablegoldproductionof1,671,340ounces.AstheCompanyplansitsnextgrowthphasefromthisexpandedproductionplatform,itexpectstocontinuetodeliveronitsvisionandstrategy.Annualpayablegoldproductionisexpectedtodecreasetoapproximately1,545,000ouncesin2016,representinga7.5%decreasecomparedwith2015.TheCompanyexpectsthatthemaincontributorstoachievingthetargetedlevelsofpayablegoldproduction,mineralreservesandmineralresourcesin2016willinclude:

• IncreasedproductionfromtheLaRondemineduetothesuccessfulcommissioningofacoolingplantandtheexpectedfullcommissioningofthecoarseoreconveyor;


• IncreasedproductionfromtheKittilamineduetocontinuedmilloptimization;and

• ContinuedconversionofAgnicoEagle'scurrentmineralresourcestomineralreserves.

FinancialOutlook

Revenue from Mining Operations and Production Costs

In2016,theCompanyexpectstocontinuetogeneratesolidcashflowwithpayablegoldproductionofapproximately1,545,000ouncescomparedwith1,671,340ouncesin2015.ThisexpecteddecreaseinpayablegoldproductionisprimarilyduetotheplannedwinddownoftheLapaminein2016,lowerexpectedgradesatthePinosAltosmineandtheexpansionoftheMeadowbankmine'sVaultpit,deferringgoldproductionfrom2016tosubsequentyearsthoughextendingtheMeadowbankminelife.

Thetablebelowsetsoutactualpayableproductionin2015andexpectedpayableproductionin2016:

2016

Forecast2015 Actual

Gold(ounces) 1,545,000 1,671,340

Silver(thousandsofounces) 3,886 4,258

Zinc(tonnes) 4,887 3,501

Copper(tonnes) 4,860 4,941

In2016,theCompanyexpectstotalcashcostsperounceofgoldproducedonaby-productbasisattheLaRondeminetobeapproximately$592comparedwith$590in2015.Incalculatingexpectationsoftotalcashcostsperounceofgoldproducedonaby-productbasisfortheLaRondemine,netsilver,zincandcopperby-productrevenueoffsetsproductioncosts.Therefore,productionandpriceassumptionsforby-productmetalsplayanimportantroleintheLaRondemine'sexpectedtotalcashcostsperounceofgoldproducedonaby-productbasisduetoitssignificantby-productproduction.ThePinosAltosminealsogeneratessignificantsilverby-productrevenue.Anincreaseinby-productmetalpricesaboveforecastedlevelswouldresultinimprovedtotalcashcostsperounceofgoldproducedonaby-productbasisatthesemines.Totalcashcostsperounceofgoldproducedonaco-productbasisareexpectedtobeapproximately$756in2016attheLaRondeminecomparedwith$760in2015.

AsproductioncostsattheLaRonde,Lapa,Goldex,MeadowbankandCanadianMalarticminesaredenominatedprimarilyinCanadiandollars,productioncostsattheKittilaminearedenominatedprimarilyinEurosandproductioncostsatthePinosAltosmine,theCrestonMascotadepositatPinosAltosandtheLaIndiaminearedenominatedprimarilyinMexicanpesos,theCanadiandollar/USdollar,Euro/USdollarandMexicanpeso/USdollarexchangeratesalsoaffecttheCompany'sexpectationsforthetotalcashcostsperounceofgoldproducedbothonaby-productandco-productbasis.


Thetablebelowsetsoutthemetalpriceandexchangerateassumptionsusedinderivingtheexpected2016totalcashcostsperounceofgoldproducedonaby-productbasis(forecastedproductionforeachmetalisshowninthetableabove)aswellastheactualmarketaverageclosingpricesforeachvariablefortheperiodofJanuary1,2016throughFebruary29,2016:

2016

Assumptions

Actual Market Average

(January 1, 2016 – February 29, 2016)

Gold(perounce) $1,100 $1,147

Silver(perounce) $16.00 $14.60

Zinc(pertonne) $1,750 $1,615

Copper(pertonne) $4,700 $4,533

C$/US$exchangerate(C$) $1.30 $1.40

Euro/US$exchangerate(Euros) €0.91 €0.91

Mexicanpeso/US$exchangerate(Mexicanpesos) 16.00 18.25

SeeRisk Profile – Metal Prices and Foreign Currencies inthisMD&Afortheexpectedimpactonforecasted2016totalcashcostsperounceofgoldproducedonaby-productbasisofcertainchangesinmetalpriceandexchangerateassumptions.

Exploration and Corporate Development Expenditures

In2016,AgnicoEagleexpectstoincurexplorationandcorporatedevelopmentexpensesofapproximately$138.0million.ExplorationexpensesareexpectedtobefocusedontheAmaruqprojectinNunavut,Canada(locatedapproximately50kilometresnorthwestoftheMeadowbankmine),theElBarquenoprojectinJaliscoState,Mexico(acquiredonNovember28,2014aspartofCayden)andtheSisarZoneattheKittilamineinFinland.Theexpected2016Amaruqprojectdrillprogramofapproximately$43.0millionwillfocusonexpandingandupgradingmineralresourcesandoutliningasecondopenpitdepositwiththegoalofpotentiallydevelopingthedepositasasatelliteoperationtotheMeadowbankmine.TheCompanybelievesthattheElBarquenoproject'sgold-silverdepositscouldpotentiallybedevelopedintoaseriesofopenpitsutilizingheapleachprocessing,similartotheCrestonMascotadepositatPinosAltosandtheLaIndiamine.AgnicoEagle'sexpectedexplorationprogramattheElBarquenoprojectin2016ofapproximately$13.0millionwillfocusonmineralresourcedevelopment,conversionandregionalexploration.

ExplorationprogramsaredesignedtoinfillandexpandknowndepositsandtestotherfavourabletargetareasthatcouldultimatelysupplementtheCompany'sexistingproductionprofile.Explorationissuccessdrivenandthusplannedexplorationcouldchangemateriallybasedontheresultsofthevariousexplorationprograms.Whenitisdeterminedthataprojectcangeneratefutureeconomicbenefit,thecostsofdrillinganddevelopmenttofurtherdelineatetheorebodyonsuchapropertyarecapitalized.In2016,theCompanyexpectstocapitalizeapproximately$15.0millionondrillinganddevelopmentrelatedtofurtherdelineatingorebodiesandconvertingmineralresourcesintomineralreserves.

Other Expenses

Generalandadministrativeexpensesareexpectedtobebetween$90.0millionand$105.0millionin2016comparedwith$97.0millionin2015.Amortizationofproperty,plantandminedevelopmentisexpectedtoincreasetobetween$630.0millionand$660.0millionin2016comparedwith$608.6millionin2015primarilyduetoexpectedincreasesingoldproductionattheKittilaandLaRondeminesbetweenperiodsandtheamortizationofexpected2016capitalexpendituresof$41.0millionattheMeadowbankmineoveritslimitedremainingminelife.TheCompany'seffectivetaxrateisexpectedtobebetween40.0%and45.0%in2016.


Capitalexpenditures,includingsustainingcapital,constructionanddevelopmentcostsandcapitalizedexplorationcosts,areexpectedtototalapproximately$491.0millionin2016.TheCompanyexpectstofundits2016capitalexpendituresthrough


operatingcashflowfromthesaleofitsgoldproductionandtheassociatedby-productmetals.Significantcomponentsoftheexpected2016capitalexpendituresprogramincludethefollowing:

• $297.0millioninsustainingcapitalexpendituresrelatingtotheLaRondemine($62.0million),CanadianMalarticmine($59.0million–portionattributabletotheCompany),Kittilamine($56.0million),PinosAltosmine($54.0million),Meadowbankmine($41.0million),Goldexmine($10.0million),LaIndiamine($8.0million)andtheCrestonMascotadepositatPinosAltos($7.0million);

• $179.0millionincapitalizeddevelopmentexpendituresrelatingtotheMeliadineproject($96.0million),Goldexmine($64.0million),Kittilamine($10.0million),PinosAltosmine($7.0million)andtheCanadianMalarticmine($2.0million–portionattributabletotheCompany);and

• $15.0millionincapitalizeddrillingexpenditures.

TheCompanycontinuestoexamineotherpossiblecorporatedevelopmentopportunitieswhichmayresultintheacquisitionofcompaniesorassetswithsecurities,cashoracombinationthereof.Ifcashisusedtofundacquisitions,AgnicoEaglemayberequiredtoissuedebtorsecuritiestosatisfycashrequirements.

All-in Sustaining Costs per Ounce of Gold Produced

BasedontherecommendationsoftheWorldGoldCouncilmadein2013,theCompanymodifieditscalculationofall-insustainingcostsperounceofgoldproducedbeginningin2014.All-insustainingcostsperounceofgoldproducediscalculatedonbothaby-productbasis(deductingby-productmetalrevenuesfromproductioncosts)andco-productbasis(beforeby-productmetalrevenues).All-insustainingcostsperounceofgoldproducedonaby-productbasisiscalculatedastheaggregateoftotalcashcostsperounceofgoldproducedonaby-productbasisandsustainingcapitalexpenditures(includingcapitalizedexploration),generalandadministrativeexpenses(includingstockoptions)andnon-cashreclamationprovisionexpenseperounceofgoldproduced.All-insustainingcostsperounceofgoldproducedonaco-productbasisiscalculatedinthesamemannerasall-insustainingcostsperounceofgoldproducedonaby-productbasisexceptthatnoadjustmentforby-productmetalrevenuesismadetototalcashcostsperounceofgoldproduced.Thecalculationofall-insustainingcostsperounceofgoldproducedonaco-productbasisdoesnotreflectareductioninproductioncostsorsmelting,refiningandmarketingchargesassociatedwiththeproductionandsaleofby-productmetals.

AgnicoEagle'sall-insustainingcostsperounceofgoldproducedonaby-productbasisareexpectedtobeapproximately$850to$890in2016comparedwith$810millionin2015.

Risk Profile

TheCompanymitigatesthelikelihoodandpotentialseverityofthevariousrisksitencountersinitsday-to-dayoperationsthroughtheapplicationofhighstandardsintheplanning,constructionandoperationofitsminingfacilities.Emphasisisplacedonhiringandretainingcompetentpersonnelanddevelopingtheirskillsthroughtraining,includingsafetyandlosscontroltraining.TheCompany'soperatingandtechnicalpersonnelhaveasolidtrackrecordofdevelopingandoperatingpreciousmetalminesandseveraloftheCompany'smineshavereceivedsafetyanddevelopmentawards.Nevertheless,theCompanyanditsemployeescontinueeffortstoimproveworkplacesafetywithanemphasisonsafetyproceduretrainingforbothminingandsupervisoryemployees.

TheCompanyalsomitigatessomeofitsnormalbusinessriskthroughthepurchaseofinsurancecoverage.AnInsurableRiskManagementPolicy,approvedbytheBoard,governsthepurchaseofinsurancecoverageandrestrictscoveragetoinsurancecompaniesofthehighestcreditquality.ForamorecompletelistoftheriskfactorsaffectingtheCompany,pleasesee"RiskFactors"intheAIF.

CommodityPricesandForeignCurrencies

AgnicoEagle'snetincomeissensitivetometalpricesandtheCanadiandollar/USdollar,Mexicanpeso/USdollarandEuro/USdollarexchangerates.Forthepurposeofthesensitivityanalysessetoutinthetablebelow,theCompanyappliedthefollowingmetalpriceandexchangerateassumptionsfor2016:

• Gold–$1,100perounce;

• Silver–$16perounce;

• Zinc–$1,750pertonne;


• Copper–$4,700pertonne;

• Diesel–C$0.77perlitre;

• Canadiandollar/USdollar–C$1.30per$1.00;

• Euro/USdollar–€0.91per$1.00;and

• Mexicanpeso/USdollar–16.00Mexicanpesosper$1.00.

Changesinthemarketpriceofgoldmaybeattributedtonumerousfactorssuchasdemand,globalmineproductionlevels,centralbankpurchasesandsalesandinvestorsentiment.Changesinthemarketpricesofothermetalsmaybeattributedtofactorssuchasdemandandglobalmineproductionlevels.Changesinthemarketpriceofdieselmaybeattributedtofactorssuchassupplyanddemand.Changesinexchangeratesmaybeattributedtofactorssuchassupplyanddemandforcurrenciesandeconomicconditionsineachcountryorcurrencyarea.In2015,therangesofmetalprices,dieselpricesandexchangerateswereasfollows:

• Gold:$1,046–$1,308perounce,averaging$1,160perounce;

• Silver:$13.65–$18.49perounce,averaging$15.71perounce;

• Zinc:$1,461–$2,434pertonne,averaging$1,928pertonne;

• Copper:$4,512–$6,482pertonne,averaging$5,499pertonne;

• Diesel:C$98.60–C$128.40perlitre,averagingC$109.31perlitre;

• Canadiandollar/USdollar:C$1.16–C$1.40per$1.00,averagingC$1.28per$1.00;

• Euro/USdollar:€0.83–€0.96per$1.00,averaging€0.90per$1.00;and

• Mexicanpeso/USdollar:14.44–17.47Mexicanpesosper$1.00,averaging15.88Mexicanpesosper$1.00.

Thefollowingtablesetsouttheimpactonforecasted2016totalcashcostsperounceofgoldproducedonaby-productbasisofspecificallyidentifiedchangesinassumedmetalprices,thedieselpriceandexchangerates.Specificallyidentifiedchangesineachvariablewereconsideredinisolationwhileholdingallotherassumptionsconstant.Basedonhistoricalmarketdataandthe2015pricerangesshownabove,thesespecificallyidentifiedchangesinassumedmetalpricesandexchangeratesarereasonablylikelyin2016.

Changes in Variable

Impact on Forecasted2016

Total Cash Costs perOunce

of Gold Produced (By-Product Basis)

Silver–$1perounce $2

Zinc–10% –

Copper–10% –

Diesel–10% $2

Canadiandollar/USdollar–1% $5

Euro/USdollar–1% $1

Mexicanpeso/USdollar–10% $3

Inordertomitigatetheimpactoffluctuatingby-productmetalprices,theCompanyoccasionallyentersintoderivativefinancialinstrumentcontractsunderitsBoard-approvedRiskManagementPoliciesandProcedures.TheCompanyhasalong-standingpolicyofnoforwardgoldsales.However,thepolicydoesallowtheCompanytouseotherhedgingstrategieswhereappropriatetomitigateforeignexchangeandby-productmetalpricingrisks.TheCompanyoccasionallybuysputoptions,entersintopricecollarsandentersintoforwardcontractstoprotectminimumby-productmetalpriceswhilemaintainingfullexposuretothepriceofgold.TheRiskManagementCommitteehasapprovedthestrategyofusing


short-termcalloptionsinanattempttoenhancetherealizedby-productmetalprices.TheCompany'spolicydoesnotallowspeculativetrading.

TheCompanyreceivespaymentforallofitsmetalsalesinUSdollarsandpaysmostofitsoperatingandcapitalcostsinCanadiandollars,EurosorMexicanpesos.Thisgivesrisetosignificantcurrencyriskexposure.TheCompanyentersintocurrencyhedgingtransactionsunderitsBoard-approvedForeignExchangeRiskManagementPoliciesandProcedurestohedgepartofitsforeigncurrencyexposure.Thepolicydoesnotpermitthehedgingoftranslationexposure(thatis,thegainsandlossesthatarisefromtheaccountingtranslationofCanadiandollar,EuroorMexicanpesodenominatedassetsandliabilitiesintoUSdollars),asitdoesnotgiverisetocashexposure.TheCompany'sforeigncurrencyderivativefinancialinstrumentstrategyincludestheuseofpurchasedputs,soldcalls,collarsandforwardsthatarenotheldforspeculativepurposes.

CostInputs

TheCompanyconsidersandmayenterintoriskmanagementstrategiestomitigatepriceriskoncertainconsumablesincluding,butnotlimitedto,dieselfuel.Thesestrategieshavelargelybeenconfinedtolongertermpurchasingcontractsbutmayincludefinancialandderivativeinstruments.

InterestRates

TheCompany'scurrentexposuretomarketriskforchangesininterestratesrelatesprimarilytodrawdownsonitsCreditFacilityanditsinvestmentportfolio.DrawdownsontheCreditFacilityareusedprimarilytofundaportionofthecapitalexpendituresrelatedtotheCompany'sdevelopmentprojectsandworkingcapitalrequirements.AsatDecember31,2015,theCompanyhaddrawndown$265.0millionontheCreditFacility.Inaddition,theCompanyinvestsitscashininvestmentswithshortmaturitiesorwithfrequentinterestresettermsandacreditratingofR1-Highorbetter.Asaresult,theCompany'sinterestincomefluctuateswithshort-termmarketconditions.AsatDecember31,2015,short-terminvestmentswere$7.4million.

AmountsdrawnundertheCreditFacilityaresubjecttofloatinginterestratesbasedonbenchmarkratesavailableintheUnitedStatesandCanadaoronLIBOR.Inthepast,theCompanyhasenteredintoderivativeinstrumentstohedgeagainstunfavorablechangesininterestrates.TheCompanywillcontinuetomonitoritsinterestrateexposureandmayenterintosuchagreementstomanageitsexposuretofluctuatinginterestrates.

FinancialInstruments

TheCompanyoccasionallyentersintocontractstolimittheriskassociatedwithdecreasedby-productmetalprices,increasedforeigncurrencycosts(includingcapitalexpenditures)andinputcosts.Thecontractsactaseconomichedgesofunderlyingexposuresandarenotheldforspeculativepurposes.AgnicoEagledoesnotusecomplexderivativecontractstohedgeexposures.

Usingfinancialinstrumentscreatesvariousfinancialrisks.CreditriskistheriskthatthecounterpartiestofinancialcontractswillfailtoperformonanobligationtotheCompany.Creditriskispartiallymitigatedbydealingwithhighqualitycounterpartiessuchasmajorbanks.Marketliquidityriskistheriskthatafinancialpositioncannotbeliquidatedquickly.TheCompanyprimarilymitigatesmarketliquidityriskbyspreadingoutthematurityoffinancialcontractsovertime,usuallybasedonprojectedproductionlevelsforthespecificmetalbeinghedged,suchthattherelevantmarketswillbeabletoabsorbthecontracts.Mark-to-marketriskistheriskthatanadversechangeinmarketpricesformetalswillaffectfinancialcondition.Becausederivativecontractsareprimarilyusedaseconomichedges,changesinmark-to-marketvaluemayimpactincome.Foradescriptionoftheaccountingtreatmentofderivativefinancialinstruments,pleaseseeCritical IFRS Accounting Policies and Accounting Estimates – DerivativeInstruments and Hedge Accounting inthisMD&A.

OperationalRisk

Thebusinessofgoldminingisgenerallysubjecttorisksandhazards,includingenvironmentalhazards,industrialaccidents,unusualorunexpectedrockformations,changesintheregulatoryenvironment,cave-ins,rockbursts,rockfalls,groundconditions,pitwallfailures,floodingandgoldbullionlosses.Theoccurrenceoftheseorsimilartypesofeventsandcircumstancesmayresultindamageto,ordestructionof,mineralpropertiesorproductionfacilities,personalinjuryordeath,environmentaldamage,delaysinmining,monetarylossesandlegalliability.TheCompanycarriesinsurancetoprotectitselfagainstcertainrisksofminingandprocessinginamountsthatitconsiderstobeadequatebutwhichmaynotprovidecoverageincertainunforeseencircumstances.TheCompanymayalsobecomesubjecttoliabilityforpollution,cave-insor


otherhazardsagainstwhichitcannotinsureoragainstwhichithaselectednottoinsurebecauseofpremiumcostsorotherreasons.TheCompanyalsomaybecomesubjecttoliabilitieswhichexceedpolicylimits.Inthesecircumstances,theCompanymayberequiredtoincursignificantcoststhatcouldhaveamaterialadverseeffectonitsfinancialperformanceandresultsofoperations.

TheCompany'srelativeminesitegoldproductioncontributionsareexpectedtocontinuetodiversifyin2016comparedwithprioryears.TheMeadowbankmine,whichwastheCompany'smostsignificantpayablegoldproductioncontributorin2015at22.8%,isexpectedtoaccountfor19.7%oftheCompany'spayablegoldproductionin2016.

Thefollowingtablesetsoutexpected2016payablegoldproductionbymine:

Expected Payable Gold Production

(Ounces)

Expected Payable Gold Production

(%)

LaRondemine 275,000 17.8

Lapamine 60,000 3.9

Goldexmine 105,000 6.8

Meadowbankmine 305,000 19.7

CanadianMalarticmine 280,000 18.1

Kittilamine 200,000 13.0

PinosAltosmine 175,000 11.3

CrestonMascotadepositatPinosAltos 45,000 2.9

LaIndiamine 100,000 6.5

Total 1,545,000 100.0

Miningisacomplexandunpredictablebusinessand,therefore,actualpayablegoldproductionmaydifferfromexpectations.AdverseconditionsaffectingminingormillingmayhaveamaterialadverseimpactontheCompany'sfinancialperformanceandresultsofoperations.TheCompanyanticipatesusingrevenuegeneratedbyitsoperationstofinancethecapitalexpendituresrequiredatitsmineprojects.

TheCompanymaynotachieveexpectedpayablegoldproductionlevelsasaresultofoccurrencessuchascave-ins,rockfalls,rockbursts,pitwallfailures,firesorfloodingorasaresultofotheroperationalproblemssuchasafailureofaproductionhoist,anautoclave,afilterpressoragrindingmill.Payablegoldproductionmayalsobeaffectedbyunfavorableweatherconditions,groundconditionsorseismicactivity,lowerthanexpectedoregrades,higherthanexpecteddilution,electricalpowerinterruptions,thephysicalormetallurgicalcharacteristicsoftheoreandheapleachprocessingresultingincontainmentdischarge.TheCompanyhasfailedtomeetpayablegoldproductionforecastsinthepastduetoadverseconditionssuchasrockfalls,productiondrillingchallenges,lowerthanplannedmillrecoveriesandgrades,higherthanexpecteddilution,minestructuralissuesanddelaysinthecommencementofproductionandrampupatnewmines.OnOctober19,2011,theCompanysuspendedminingoperationsandgoldproductionattheGoldexmine'sGoldexExtensionZoneindefinitelyduetogeotechnicalconcernswiththerockabovethemininghorizon,significantlyimpactingAgnicoEagle'spayablegoldproduction.OnSeptember30,2012,theCrestonMascotadepositatPinosAltosexperiencedamovementofleachedorefromtheupperliftsofthePhaseOneleachpad,resultinginatemporarysuspensionofactiveleachingthroughMarch13,2013andsignificantlyimpactingtheCompany'spayablegoldproduction.Occurrencesofthisnatureandotheraccidents,adverseconditions,operationalproblemsorregulatorycircumstancesinfutureyearsmayresultintheCompany'sfailuretoachievecurrentorfutureproductionexpectations.

TheLaRondemineextensionisoneofthedeepestoperationsintheWesternHemisphere,withanexpectedmaximumdepthofover3kilometres.TheoperationsoftheLaRondemineextensionrelyonnewinfrastructureforhaulingoreandmaterialstothesurface,includingawinze(orinternalshaft)andaseriesoframpslinkingminingdepositstothePennaShaftthatservicescurrentoperationsattheLaRondemine.In2012,challengesassociatedwithheatandcongestionintheLaRondemine


extensioncausedadelayintheexpectedrampupingoldproduction.AlthoughanewcoolingplantbeganoperatinginDecember2013,thedepthoftheoperationscouldcontinuetoposesignificantchallengestotheCompany,suchasgeomechanicalrisksandventilationandairconditioningrequirements,whichmayresultindifficultiesanddelaysinachievinggoldproductionobjectives.

ThecontinuedsustainingdevelopmentoftheLaRondemineextensionissubjecttoanumberofrisksandchallenges,includingunforeseengeologicalformations,theimplementationofnewminingprocesses,andengineeringandminedesignadjustments.TheseoccurrencesmayresultinoperationaldelaysandinadditionalcostsbeingincurredbytheCompanybeyondthosebudgeted.

TheCompany'sstatedmineralreservesandmineralresourcesareestimatesandnoassurancecanbegiventhattheanticipatedtonnagesandgradeswillbeachievedorthattheindicatedlevelofrecoveryofgoldwillberealized.TheoregradeactuallyrecoveredbytheCompanymaydifferfromtheexpectedgradesofthemineralreservesandmineralresources.Theestimatesofmineralreservesandmineralresourceshavebeendeterminedbasedon,amongotherthings,assumedmetalprices,foreignexchangeratesandoperatingcosts.Prolongeddeclinesinthemarketpriceofgold(orapplicableby-productmetalprices)mayrendermineralreservescontainingrelativelylowergradesofmineralizationuneconomicaltorecoverandcouldmateriallyreducetheCompany'smineralreserves.Shouldsuchreductionsoccur,theCompanymayberequiredtorecordamaterialimpairmentlossonitsinvestmentinminingpropertiesordelayordiscontinueproductionorthedevelopmentofnewprojects,resultinginnetlossesandreducedcashflow.Marketpricefluctuationsofgold(orapplicableby-productmetalprices),aswellasincreasedproductioncostsorreducedrecoveryrates,mayrendermineralreservescontainingrelativelylowergradesofmineralizationuneconomicaltorecoverandmayultimatelyresultinarestatementofmineralreservesandmineralresources.Short-termfactorsrelatingtothemineralreserve,suchastheneedfororderlydevelopmentoforebodiesortheprocessingofnewordifferentgrades,mayimpairtheprofitabilityofamineinanyparticularreportingperiod.

Mineralresourceestimatesforpropertiesthathavenotcommencedproductionoratdepositsthathavenotyetbeenexploitedarebased,inmostinstances,onverylimitedandwidelyspaceddrillholeinformation,whichisnotnecessarilyindicativeofconditionsbetweenandaroundthedrillholes.Accordingly,suchmineralresourceestimatesmayrequirerevisionasmoredrillinginformationbecomesavailableorasactualproductionexperienceisgained.

TheCompany'soperationsincludeamineinFinlandandminesinMexico.Theseoperationsareexposedtovariouslevelsofpolitical,economicandotherrisksanduncertaintiesthataredifferentfromthoseencounteredattheCompany'sCanadianproperties.Theserisksanduncertaintiesvaryfromcountrytocountryandmayinclude:extremefluctuationsincurrencyexchangerates;highratesofinflation;labourunrest;risksofwarorcivilunrest;increasedregulatoryrequirements;expropriationandnationalization;renegotiationornullificationofexistingconcessions,licenses,permitsandcontracts;illegalmining;corruption;restrictionsonforeignexchangeandrepatriation;hostagetaking;andchangingpoliticalconditionsandcurrencycontrols.Inaddition,theCompanymustcomplywithmultipleandpotentiallyconflictingregulationsinCanada,theUnitedStates,EuropeandMexico,includingexportrequirements,taxes,tariffs,importdutiesandothertradebarriers,aswellashealth,safetyandenvironmentalrequirements.

TheCompany'sMeadowbankmineislocatedintheKivalliqDistrictofNunavutinnorthernCanada,approximately70kilometresnorthofBakerLake.ThoughtheCompanybuilta110kilometreall-weatherroadfromBakerLake,whichprovidessummershippingaccessviaHudsonBaytotheMeadowbankmine,theCompany'soperationsareconstrainedbytheremotenessofthemine,particularlyastheportofBakerLakeisonlyaccessibleapproximately2.5monthsperyear.MostofthematerialsthattheCompanyrequiresfortheoperationoftheMeadowbankmine,includingtheexplorationandpotentialdevelopmentoftheAmaruqdeposit,mustbetransportedthroughtheportofBakerLakeduringthisshippingseason,whichmaybefurthertruncatedduetoweatherconditions.IftheCompanyisnotabletoacquireandtransportnecessarysuppliesduringthistime,thismayresultinaslowdownorstoppageofoperationsattheMeadowbankmine.Furthermore,ifmajorequipmentfails,anyitemsnecessarytoreplaceorrepairsuchequipmentmayhavetobeshippedthroughBakerLakeduringthiswindow.FailuretohavethenecessarymaterialsrequiredforoperationsortorepairorreplacemalfunctioningequipmentattheMeadowbankminemayrequiretheslowdownorstoppageofoperations.

RegulatoryRisk

TheCompany'sminingandmineralprocessingoperations,explorationactivitiesandpropertiesaresubjecttothelawsandregulationsoffederal,provincial,stateandlocalgovernmentsinthejurisdictionsinwhichtheCompanyoperates.Theselawsandregulationsareextensiveandgovernprospecting,exploration,development,production,exports,taxes,labourstandards,occupationalhealthandsafety,wastedisposal,toxicsubstances,environmentalprotection,minesafetyandother


matters.Compliancewithsuchlawsandregulationsincreasesthecostsofplanning,designing,drilling,developing,constructing,operating,closing,reclaimingandrehabilitatingminesandotherfacilities.Newlawsorregulations,amendmentstocurrentlawsandregulationsgoverningoperationsandactivitiesofminingcompaniesormorestringentimplementationorinterpretationthereofcouldhaveamaterialadverseimpactontheCompany,causeareductioninlevelsofproductionanddelayorpreventthedevelopmentofnewminingproperties.

Controls Evaluation

TheCompany'smanagementisresponsibleforestablishingandmaintainingadequateinternalcontroloverfinancialreporting("ICFR")anddisclosurecontrolsandprocedures("DC&P").TheCompany'smanagement,underthesupervisionoftheCompany'sChiefExecutiveOfficerandChiefFinancialOfficer,hasevaluatedtheeffectivenessofitsICFRandDC&PasatDecember31,2015.Basedonthisevaluation,managementconcludedthattheCompany'sICFRandDC&Pwereeffective.

Outstanding Securities

ThefollowingtablesetsoutthemaximumnumberofcommonsharesthatwouldbeoutstandingifalldilutiveinstrumentsoutstandingatFebruary29,2016wereexercised:

CommonsharesoutstandingatFebruary29,2016 219,677,985

Employeestockoptions 9,566,989

CommonsharesheldinatrustinconnectionwiththeRestrictedShareUnitplan,PerformanceShareUnitplanandLongTermIncentivePlan 848,176

Total 230,093,150

Governance

AgnicoEagle'sSustainableDevelopmentPolicy,approvedbytheBoardofDirectorsin2012,formallyoutlinestheguidingprinciplesandcommitmentsthattheCompanystrivestouphold.TheSustainableDevelopmentPolicyisbasedonfourfundamentalvaluesofsustainabledevelopmentatAgnicoEagle:respectfortheCompany'semployees;protectionoftheenvironment;safeoperations;andrespectfortheCompany'scommunities.

Sustainable Development Management

In2015,theCompanycontinuedtheprocessofintegratingsustainabilityintoallaspectsandstagesofitsbusiness,fromthecorporateobjectivesandexecutiveresponsibilityof'maintaininghighstandardsinsustainability'toexplorationandacquisitionactivities,daytodayoperatingandsiteclosureplans.Thisintegrationisintendedtoleadtoemployeestakinggreaterownershiptowardstheimplementationofresponsibleminingpractices,therebyreducingrisk.

ThisintegrationprocessisdonethroughthedevelopmentandimplementationofaformalHealth,Safety,EnvironmentandCommunityManagementSystem,termedtheResponsibleMiningManagementSystem("RMMS").TheaimoftheRMMSistofurtherpromoteacultureofaccountabilityandleadershipinmanaginghealth,safety,environmentalandsocialacceptabilitymatters.RMMSdocumentationissupportedbythesoftwareIntelex,whichiswidelyusedintheCanadianminingindustryandisconsistentwiththeISO14001EnvironmentalManagementSystemandtheBSOHSAS18001OccupationalHealthandSafetyManagementSystem.

AgnicoEaglebecameasignatoryoftheInternationalCyanideManagementCode(the"CyanideCode")in2011.TheCompany'scommitmentsasasignatorytotheCyanideCodeareincorporatedintheRMMS.CyanideCoderequirementscertificationwasreceivedbytheCompany'sKittila,PinosAltosandMeadowbankminesin2015.

TheRMMSalsointegratestherequirementsoftheMiningAssociationofCanada'sindustryleadingTowardsSustainableMiningInitiative(the"TSMInitiative"),aswellastheGlobalReportingInitiative'ssustainabilityreportingguidelinesfortheminingindustry.InDecember2010,AgnicoEaglebecameamemberoftheMiningAssociationofCanadaandendorsedtheTSMInitiative.TheTSMInitiativewasdevelopedtohelpminingcompaniesevaluatethequality,comprehensivenessandrobustnessoftheirmanagementsystemsundersixperformanceprotocols:crisismanagement;energyandgreenhousegasemissionsmanagement;tailingsmanagement;biodiversityconservationmanagement;healthandsafety;andaboriginalrelationsandcommunityoutreach.In2015,allofAgnicoEagle'sminescompletedanexternalauditevaluatingtheTSM


protocols.AsaresultoftheTSMprotocolsaudit,theMiningAssociationofCanadarecognizedtheKittila,GoldexandLaRondemineswithachievementawardsforhavingreachedAlevelstatusinallprotocols.Ofthe132indicatorsreviewed,allbut8achievedanAlevelstatus.TheCompanyhasdevelopedactionplanstoaddressthe8indicatorsreviewedthatdidnotachieveanAlevelstatus.

Employee Health and Safety

TheCompanyisresponsibleforprovidingemployeeswithasafeworkingenvironmentandwiththetoolsandtrainingtocarryouttheirdutiesinanefficientandsafemanner.In2015,AgnicoEagle'scombinedlost-timeaccident("LTA")frequencyratewassignificantlylowerthanitstargetrate,and17.0%lowerthan2014.TheCompanyhasnowachieveditslowestevercombinedLTArateforthefifthyearinarow.

In2015,anactionplanwasimplementedtoaddressrisksidentifiedthroughaCompany-wideriskassessmenttoidentifyandclassifyhealthandsafetyrisksaswellasriskstotheenvironmentandlocalcommunities.

OneofthemeasuresimplementedbytheCompanytoimprovesafetyperformanceistheworkplacesafetycardsystem.ThissystemwasimplementedacrosstheCompanytostrengthenitsrisk-basedtrainingprogram.DevelopedbytheQuebecMiningAssociation,thesafetycardsystemteachesworkersandsupervisorstouserisk-basedthinkingintheirduties.Workersandtheirsupervisorsmustmeeteachdaytodiscusson-the-jobhealthandsafetymatters.ThesafetycardsystemalsoallowstheCompany'sworkersandsupervisorstodocumentdailyinspectionsandrecordobservationsonconditionsintheworkplace,aswellasthenatureofrisks,issuesandotherinformation.Inaddition,itallowssupervisorstoexchangeandanalyzeinformationbetweenshiftstoimproveefficiencyandsafety.

EachoftheCompany'sminingoperationshasitsownEmergencyResponsePlanandhaspersonneltrainedtorespondtosafety,fireandenvironmentalemergencies.Eachminealsomaintainstheappropriateresponseequipment.

Community

TheCompany'sgoalateachofitsoperationsistohireasmuchaspossibleofitsworkforce,includingmanagementteams,directlyfromthelocalregioninwhichtheoperationislocated.In2015,theproportionofAgnicoEagle`smineworkforcehiredlocallywas80.0%whiletheproportionoftheminemanagementteamhiredlocallywas71.0%.TheCompanybelievesthatprovidingemploymentisoneofthemostsignificantcontributionsitcanmaketothecommunitiesinwhichitoperates.In2015,AgnicoEaglecontinueditspartnershipwiththeKivalliqMineTrainingSocietytobuildaqualifiedworkforcepoolintheKivalliqregionofNunavut.

AgnicoEagleworkscloselywithneighbouringcommunitiestodevelopalternativeemploymentandbusinessopportunitiestohelpdiversifylocaleconomies.TheCompanyalsocontinuestosupportanumberofcommunityhealthandeducationalinitiativessurroundingitsmines.In2015,theCompanyworkedwiththecommunityofBakerLake,Nunavutindevelopingaplantoimprovecommunitywellness.

Environment

In2015,aleakageofdischargequalitywateroccurredinonecorneroftheneutralizedprecipitatetailingspondattheKittilamine.Thedischargewascontrolledandaremediationplanthatwasapprovedbytherelevantauthoritywasimplemented.

TheappealprocessrelatedtotheJuly2013Kittilamineupdatedenvironmentalpermitcontinuedin2015.Afinaldecisionisexpectedin2016.

In2015,aprojectcertificatefortheMeliadineprojectwasreceivedfromtheNunavutImpactReviewBoardandatypeBwaterlicenceforpre-developmentworkwasreceivedfromtheNunavutWaterBoard.AtypeBwaterlicencefortheconstructionofanexplorationroadfromtheMeadowbankminetotheAmaruqprojectwasalsoreceivedfromtheNunavutWaterBoardin2015.AnapplicationfortheMeliadineprojecttypeAwaterlicence(operatinglicence)wasfiledin2015andthelicenceisexpectedtobereceivedin2016.

TheCanadianMalarticminereceivedregulatorynoticeof25infractionsin2015relatedprimarilytonoise,blastingfumesandoverpressure.Progresshasbeenmadeaddressingsuchissuessince2014.

InAugust2015,AgnicoEaglereceivedasummonstoappearincourtforanallegedenvironmentaloffencethatoccurredinJuly2013attheMeadowbankmine.Thesummonsreferstotheallegedreleaseofadeleterioussubstanceintothe


environment(alakefrequentedbyfish)andthefailuretoreportittoauthorities.Thecaseisexpectedtogothroughthecourtsystemin2016.

International Financial Reporting Standards

TheCompanyhasadoptedIFRSasitsbasisofaccounting,replacingUSGAAPeffectiveJuly1,2014.Asaresult,AgnicoEagle'sconsolidatedfinancialstatementsfor2015arereportedinaccordancewithIFRS,withcomparativeinformationrestatedunderIFRSandatransitiondateofJanuary1,2013.

GenerallyAcceptedAccountingPrinciples("GAAP")forCanadianpubliclyaccountableenterprisesbecameIFRSasissuedbytheInternationalAccountingStandardsBoardin2011andtheUSSecuritiesandExchangeCommission("SEC")intheUnitedStatesacceptsfinancialstatementspreparedinaccordancewithIFRSwithoutreconciliationtoUSGAAPfromforeignprivateissuers.Accordingly,AgnicoEagledecidedtoconvertitsbasisofaccountingtoIFRStoenhancethecomparabilityofitsfinancialstatementstotheCompany'speersintheminingindustry.

AgnicoEagledevelopedandexecutedadetailedIFRSconversionplanincludinganassessmentphase,animpactanalysisanddesignphaseandanimplementationphase,culminatingintheCompany'sinitialreportinginaccordancewithIFRSinthethirdquarterof2014.

Critical IFRS Accounting Policies and Accounting Estimates

AgnicoEagle'ssignificantIFRSaccountingpoliciesaredisclosedintheSummaryofSignificantAccountingPoliciesnotetotheconsolidatedfinancialstatements.

ThepreparationoftheconsolidatedfinancialstatementsinaccordancewithIFRSrequiresmanagementtomakeestimatesandjudgmentsthataffectthereportedamountsofassets,liabilities,revenuesandexpenses.Inmakingjudgmentsaboutthecarryingvalueofassetsandliabilities,theCompanyusesestimatesbasedonhistoricalexperienceandassumptionsthatareconsideredreasonableinthecircumstances.AlthoughtheCompanyevaluatesitsaccountingestimatesperiodically,actualresultsmaydifferfromtheseestimates.

TheCompanybelievesthefollowingcriticalaccountingpoliciesrelatetoitsmoresignificantjudgmentsandestimatesusedinthepreparationofitsconsolidatedfinancialstatements.ManagementhasdiscussedthedevelopmentandselectionofthefollowingcriticalaccountingpolicieswiththeAuditCommitteewhichhasreviewedtheCompany'sdisclosureinthisMD&A.

DerivativeInstrumentsandHedgeAccounting

TheCompanyusesderivativefinancialinstruments(primarilyoptionandforwardcontracts)tomanageexposuretofluctuationsinby-productmetalprices,interestratesandforeigncurrencyexchangeratesandmayusesuchmeanstomanageexposuretocertaininputcosts.TheCompanydoesnotholdfinancialinstrumentsorderivativefinancialinstrumentsfortradingpurposes.

TheCompanyrecognizesallderivativefinancialinstrumentsintheconsolidatedfinancialstatementsatfairvalueregardlessofthepurposeorintentforholdingtheinstrument.Changesinthefairvalueofderivativefinancialinstrumentsareeitherrecognizedperiodicallyintheconsolidatedstatementsofincomeandcomprehensiveincomeorinequityasacomponentofaccumulatedothercomprehensiveincome,dependingonthenatureofthederivativefinancialinstrumentandwhetheritqualifiesforhedgeaccounting.Financialinstrumentsdesignatedashedgesaretestedforeffectivenessateachreportingperiod.Realizedgainsandlossesonthosecontractsthatareproventobeeffectivearereportedasacomponentoftherelatedtransaction.

Goodwill

Goodwillisrecognizedinabusinesscombinationifthecostoftheacquisitionexceedsthefairvaluesoftheidentifiablenetassetsacquired.Goodwillisthenallocatedtothecashgeneratingunit("CGU")orgroupofCGUsthatareexpectedtobenefitfromthesynergiesofthecombination.ACGUisthesmallestidentifiablegroupofassetsthatgeneratescashinflowswhicharelargelyindependentofthecashinflowsfromotherassetsorgroupsofassets.

TheCompanyperformsgoodwillimpairmenttestsonanannualbasisasatDecember31eachyear.Inaddition,theCompanyassessesforindicatorsofimpairmentateachreportingperiodendand,ifanindicatorofimpairmentisidentified,


goodwillistestedforimpairmentatthattime.IfthecarryingvalueoftheCGUorgroupofCGUstowhichgoodwillisassignedexceedsitsrecoverableamount,animpairmentlossisrecognized.Goodwillimpairmentlossesarenotreversed.

TherecoverableamountofaCGUorgroupofCGUsismeasuredasthehigherofvalueinuseandfairvaluelesscostsofdisposal.

MiningProperties,PlantandEquipmentandMineDevelopmentCosts

Miningproperties,plantandequipmentandminedevelopmentcostsarerecordedatcost,lessaccumulatedamortizationandaccumulatedimpairmentlosses.

Mining Properties

Thecostofminingpropertiesincludesthefairvalueattributabletoprovenandprobablemineralreservesandmineralresourcesacquiredinabusinesscombinationorassetacquisition,undergroundminedevelopmentcosts,deferredstripping,capitalizedexplorationandevaluationcostsandcapitalizedborrowingcosts.

Significantpaymentsrelatedtotheacquisitionoflandandmineralrightsarecapitalizedasminingpropertiesatcost.Ifamineableorebodyisdiscovered,suchcostsareamortizedtoincomewhencommercialproductioncommences,usingtheunits-of-productionmethod,basedonestimatedprovenandprobablemineralreserves.Ifnomineableorebodyisdiscovered,suchcostsareexpensedintheperiodinwhichitisdeterminedthatthepropertyhasnofutureeconomicvalue.Costcomponentsofaspecificprojectthatareincludedinthecapitalcostoftheassetincludesalariesandwagesdirectlyattributabletotheproject,suppliesandmaterialsusedintheproject,andincrementaloverheadcoststhatcanbedirectlyattributabletotheproject.

Assetsunderconstructionarenotamortizeduntiltheendoftheconstructionperiodoroncecommercialproductionisachieved.Uponachievingtheproductionstage,thecapitalizedconstructioncostsaretransferredtotheappropriatecategoryofplantandequipment.

Plant and Equipment

Expendituresfornewfacilitiesandimprovementsthatcanextendtheusefullivesofexistingfacilitiesarecapitalizedasplantandequipmentatcost.Thecostofanitemofplantandequipmentincludes:itspurchaseprice,includingimportdutiesandnon-refundablepurchasetaxes,afterdeductingtradediscountsandrebates;anycostsdirectlyattributabletobringingtheassettothelocationandconditionnecessaryforittobecapableofoperatinginthemannerintendedbymanagement;andtheestimateofthecostsofdismantlingandremovingtheitemandrestoringthesiteonwhichitislocatedotherthancoststhatariseasaconsequenceofhavingusedtheitemtoproduceinventoriesduringtheperiod.

Amortizationofanassetbeginswhentheassetisinthelocationandconditionnecessaryforittooperateinthemannerintendedbymanagement.Amortizationceasesattheearlierofthedatetheassetisclassifiedasheldforsaleorthedatetheassetisderecognized.Assetsunderconstructionarenotamortizeduntiltheendoftheconstructionperiod.Amortizationischargedaccordingtoeithertheunits-of-productionmethodoronastraight-linebasis,accordingtothepatterninwhichtheasset'sfutureeconomicbenefitsareexpectedtobeconsumed.Theamortizationmethodappliedtoanassetisreviewedatleastannually.

Usefullivesofproperty,plantandequipmentarebasedonestimatedminelivesasdeterminedbyprovenandprobablemineralreserves.RemainingminelivesatDecember31,2015rangefrom1to20years.

Mine Development Costs

Minedevelopmentcostsincurredafterthecommencementofproductionarecapitalizedwhentheyareexpectedtohaveafutureeconomicbenefit.Activitiesthataretypicallycapitalizedincludecostsincurredtobuildshafts,drifts,rampsandaccesscorridorswhichenabletheCompanytoextractoreunderground.

TheCompanyrecordsamortizationonundergroundminedevelopmentcostsonaunits-of-productionbasisbasedontheestimatedtonnageofprovenandprobablemineralreservesoftheidentifiedcomponentoftheorebody.Theunits-of-productionmethoddefinesthedenominatorasthetotaltonnageofprovenandprobablemineralreserves.


Deferred Stripping

Inopenpitminingoperations,itisnecessarytoremoveoverburdenandotherwastematerialstoaccessorefromwhichmineralscanbeextractedeconomically.Theprocessofminingoverburdenandwastematerialsisreferredtoasstripping.

Duringthedevelopmentstageofthemine,strippingcostsarecapitalizedaspartofthecostofbuilding,developingandconstructingthemineandareamortizedoncetheminehasenteredtheproductionstage.

Duringtheproductionstageofamine,strippingcostsarerecordedasapartofthecostofinventoriesunlessthesecostsareexpectedtoprovideafutureeconomicbenefitand,insuchcases,arecapitalizedtoproperty,plantandminedevelopment.

Productionstagestrippingcostsprovideafutureeconomicbenefitwhen:

• Itisprobablethatthefutureeconomicbenefit(e.g. ,improvedaccesstotheorebody)associatedwiththestrippingactivitywillflowtotheCompany;

• TheCompanycanidentifythecomponentoftheorebodyforwhichaccesshasbeenimproved;and

• Thecostsrelatingtothestrippingactivityassociatedwiththatcomponentcanbemeasuredreliably.

Capitalizedproductionstagestrippingcostsareamortizedovertheexpectedusefullifeoftheidentifiedcomponentoftheorebodythatbecomesmoreaccessibleasaresultofthestrippingactivity.

Borrowing Costs

Borrowingcostsarecapitalizedtoqualifyingassets.QualifyingassetsareassetsthattakeasubstantialperiodoftimetopreparefortheCompany'sintendeduse,whichincludesprojectsthatareintheexplorationandevaluation,developmentorconstructionstages.

Borrowingcostsattributabletotheacquisition,constructionorproductionofqualifyingassetsareaddedtothecostofthoseassetsuntilsuchtimeastheassetsaresubstantiallyreadyfortheirintendeduse.Allotherborrowingcostsarerecognizedasfinancecostsintheperiodinwhichtheyareincurred.Wherethefundsusedtofinanceaqualifyingassetformpartofgeneralborrowings,theamountcapitalizediscalculatedusingaweightedaverageofratesapplicabletotherelevantborrowingsduringtheperiod.

Leases

Thedeterminationofwhetheranarrangementis,orcontains,aleaseisbasedonthesubstanceofthearrangementattheinceptiondate,includingwhetherthefulfillmentofthearrangementisdependentontheuseofaspecificassetorassetsorwhetherthearrangementconveysarighttousetheasset.

LeasingarrangementsthattransfersubstantiallyalltherisksandrewardsofownershipoftheassettotheCompanyareclassifiedasfinanceleases.Financeleasesarerecordedasanassetwithacorrespondingliabilityatanamountequaltothelowerofthefairvalueoftheleasedassetsandthepresentvalueoftheminimumleasepayments.Eachleasepaymentisallocatedbetweentheliabilityandfinancecostsusingtheeffectiveinterestratemethod,wherebyaconstantrateofinterestexpenseisrecognizedonthebalanceoftheliabilityoutstanding.Theinterestelementoftheleaseischargedtotheconsolidatedstatementofincomeasafinancecost.Anassetleasedunderafinanceleaseisamortizedovertheshorteroftheleasetermanditsusefullife.

Allotherleasesarerecognizedasoperatingleases.Operatingleasepaymentsarerecognizedasanoperatingexpenseintheconsolidatedstatementsofincomeonastraight-linebasisovertheleaseterm.

DevelopmentStageExpenditures

Developmentstageexpendituresarecostsincurredtoobtainaccesstoprovenandprobablemineralreservesandprovidefacilitiesforextracting,treating,gathering,transportingandstoringtheminerals.Thedevelopmentstageofaminecommenceswhenthetechnicalfeasibilityandcommercialviabilityofextractingthemineralresourcehasbeendetermined.Coststhataredirectlyattributabletominedevelopmentarecapitalizedasproperty,plantandminedevelopmenttotheextentthattheyarenecessarytobringthepropertytocommercialproduction.


Abnormalcostsareexpensedasincurred.Indirectcostsareincludedonlyiftheycanbedirectlyattributedtotheareaofinterest.Generalandadministrativecostsarecapitalizedaspartofthedevelopmentexpenditureswhenthecostsaredirectlyattributedtoaspecificminingdevelopmentproject.

Commercial Production

Amineconstructionprojectisconsideredtohaveenteredtheproductionstagewhenthemineconstructionassetsareavailableforuse.Indeterminingwhethermineconstructionassetsareconsideredavailableforuse,thecriteriaconsideredinclude,butarenotlimitedto,thefollowing:

• Completionofareasonableperiodoftestingmineplantandequipment;

• Abilitytoproducemineralsinsaleableform(withinspecifications);and

• Abilitytosustainongoingproductionofminerals.

Whenamineconstructionprojectmovesintotheproductionstage,amortizationcommences,thecapitalizationofcertainmineconstructioncostsceasesandexpendituresareeithercapitalizedtoinventoriesorexpensedasincurred.Exceptionsincludecostsincurredforadditionsorimprovementstoproperty,plantandminedevelopmentandopen-pitstrippingactivities.

ImpairmentofLong-livedAssets

AttheendofeachreportingperiodtheCompanyassesseswhetherthereisanyindicationthatlong-livedassetsmaybeimpaired.Ifanindicatorofimpairmentexists,therecoverableamountoftheassetiscalculatedinordertodetermineifanyimpairmentlossisrequired.Ifitisnotpossibletoestimatetherecoverableamountoftheindividualasset,assetsaregroupedattheCGUlevelforthepurposeofassessingtherecoverableamount.AnimpairmentlossisrecognizedforanyexcessofthecarryingamountoftheCGUoveritsrecoverableamount.TheimpairmentlossrelatedtoaCGUisfirstallocatedtogoodwillandtheremaininglossisallocatedonapro-ratabasistotheremaininglong-livedassetsoftheCGUbasedontheircarryingamounts.

Anyimpairmentchargethatistakenonalong-livedassetexceptgoodwillisreversediftherearesubsequentchangesintheestimatesorsignificantassumptionsthatwereusedtorecognizetheimpairmentlossthatresultinanincreaseintherecoverableamountoftheCGU.Ifanindicatorofimpairmentreversalhasbeenidentified,arecoveryshouldberecognizedtotheextenttherecoverableamountoftheassetexceedsitscarryingamount.Theamountofthereversalislimitedtothedifferencebetweenthecurrentcarryingamountandtheamountwhichwouldhavebeenthecarryingamounthadtheearlierimpairmentnotbeenrecognizedandamortizationofthatcarryingamounthadcontinued.Impairmentsandsubsequentreversalsarerecordedintheconsolidatedstatementofincomeintheperiodinwhichtheyoccur.

ReclamationProvisions

Assetretirementobligations("AROs")arisefromtheacquisition,developmentandconstructionofminingpropertiesandplantandequipmentduetogovernmentcontrolsandregulationsthatprotecttheenvironmentontheclosureandreclamationofminingproperties.ThemajorpartsofthecarryingamountofAROsrelatetotailingsandheapleachpadclosureandrehabilitation,demolitionofbuildingsandminefacilities,ongoingwatertreatmentandongoingcareandmaintenanceofclosedmines.TheCompanyrecognizesanAROatthetimetheenvironmentaldisturbanceoccursoraconstructiveobligationisdeterminedtoexistbasedontheCompany'sbestestimateofthetimingandamountofexpectedcashflowsexpectedtobeincurred.WhentheAROprovisionisrecognized,thecorrespondingcostiscapitalizedtotherelateditemofproperty,plantandminedevelopment.Reclamationprovisionsthatresultfromdisturbanceinthelandtoextractoreinthecurrentperiodisincludedinthecostofinventories.

Thetimingoftheactualenvironmentalremediationexpendituresisdependentonanumberoffactorssuchasthelifeandnatureoftheasset,theoperatinglicenceconditionsandtheenvironmentinwhichthemineoperates.Reclamationprovisionsaremeasuredattheexpectedvalueoffuturecashflowsdiscountedtotheirpresentvalueusingarisk-freeinterestrate.AROsareadjustedeachperiodtoreflectthepassageoftime(accretion).Accretionexpenseisrecordedinfinancingcostseachperiod.UponsettlementofanARO,theCompanyrecordsagainorlossiftheactualcostdiffersfromthecarryingamountoftheARO.Settlementgainsorlossesarerecordedintheconsolidatedstatementsofincome.


Expectedcashflowsareupdatedtoreflectchangesinfactsandcircumstances.Theprincipalfactorsthatcancauseexpectedcashflowstochangearetheconstructionofnewprocessingfacilities,changesinthequantitiesofmaterialinprovenandprobablemineralreservesandacorrespondingchangeinthelife-of-mineplan,changingorecharacteristicsthatimpactrequiredenvironmentalprotectionmeasuresandrelatedcosts,changesinwaterqualitythatimpacttheextentofwatertreatmentrequiredandchangesinlawsandregulationsgoverningtheprotectionoftheenvironment.

Eachreportingperiod,provisionsforAROsarere-measuredtoreflectanychangestosignificantassumptions,includingtheamountandtimingofexpectedcashflowsandrisk-freeinterestrates.Changestothereclamationprovisionresultingfromchangesinestimateareaddedtoordeductedfromthecostoftherelatedasset,exceptwherethereductionofthereclamationprovisionexceedsthecarryingvalueoftherelatedassetsinwhichcasetheassetisreducedtonilandtheremainingadjustmentisrecognizedintheconsolidatedstatementsofincome.

Environmentalremediationliabilities("ERLs")aredifferentiatedfromAROsinthatERLsdonotarisefromenvironmentalcontaminationinthenormaloperationofalong-livedassetorfromalegalorconstructiveobligationtotreatenvironmentalcontaminationresultingfromtheacquisition,constructionordevelopmentofalong-livedasset.TheCompanyisrequiredtorecognizealiabilityforobligationsassociatedwithERLsarisingfrompastacts.ERLsaremeasuredbydiscountingtheexpectedrelatedcashflowsusingarisk-freeinterestrate.TheCompanypreparesestimatesofthetimingandamountofexpectedcashflowswhenanERLisincurred.Eachreportingperiod,theCompanyassessescostestimatesandotherassumptionsusedinthevaluationofERLstoreflectevents,changesincircumstancesandnewinformationavailable.ChangesinthesecostestimatesandassumptionshaveacorrespondingimpactonthevalueoftheERL.AnychangeinthevalueofERLsresultsinacorrespondingchargeorcredittotheconsolidatedstatementsofincome.UponsettlementofanERL,theCompanyrecordsagainorlossiftheactualcostdiffersfromthecarryingamountoftheERLintheconsolidatedstatementsofincome.

Stock-basedCompensation

TheCompanyoffersequity-settledawards(theemployeestockoptionplan,incentivesharepurchaseplanandRestrictedShareUnitplan)tocertainemployees,officersanddirectorsoftheCompany.

Employee Stock Option Plan ("ESOP")

TheCompany'sESOPprovidesforthegrantingofoptionstodirectors,officers,employeesandserviceproviderstopurchasecommonshares.Optionshaveexercisepricesequaltothemarketpriceonthedaypriortothedateofgrant.Thefairvalueoftheseoptionsisrecognizedintheconsolidatedstatementsofincomeandcomprehensiveincomeorintheconsolidatedbalancesheetsifcapitalizedaspartofproperty,plantandminedevelopmentovertheapplicablevestingperiodasacompensationcost.Anyconsiderationpaidbyemployeesonexerciseofoptionsorpurchaseofcommonsharesiscreditedtosharecapital.

FairvalueisdeterminedusingtheBlack-Scholesoptionvaluationmodel,whichrequirestheCompanytoestimatetheexpectedvolatilityoftheCompany'ssharepriceandtheexpectedlifeofthestockoptions.Limitationswithexistingoptionvaluationmodelsandtheinherentdifficultiesassociatedwithestimatingthesevariablescreatedifficultiesindeterminingareliablesinglemeasureofthefairvalueofstockoptiongrants.Thecostisrecordedoverthevestingperiodoftheawardtothesameexpensecategoryoftheawardrecipient'spayrollcostsandthecorrespondingentryisrecordedinequity.Equity-settledawardsarenotre-measuredsubsequenttotheinitialgrantdate.ThedilutiveimpactofstockoptiongrantsisfactoredintotheCompany'sreporteddilutednetincomepershare.Thestockoptionexpenseincorporatesanexpectedforfeiturerate,estimatedbasedonexpectedemployeeturnover.

Incentive Share Purchase Plan ("ISPP")

UndertheISPP,directors(excludingnon-executivedirectors),officersandemployees(theparticipants)oftheCompanymaycontributeupto10.0%oftheirbasicannualsalariesandtheCompanycontributesanamountequalto50.0%ofeachparticipant'scontribution.AllcommonsharessubscribedforundertheISPPareissuedbytheCompany.

TheCompanyrecordsanexpenseequaltoitscashcontributiontotheISPP.Noforfeiturerateisappliedtotheamountsaccrued.Whereanemployeeleavespriortothevestingdate,anyaccrualforcontributionsbytheCompanyduringthevestingperiodrelatedtothatemployeeisreversed.


Restricted Share Unit ("RSU") Plan

TheRSUplanisopentodirectorsandcertainemployeesincludingseniorexecutivesoftheCompany.Commonsharesarepurchasedandheldinatrustuntiltheyhavevested.Thecostisrecordedoverthevestingperiodoftheawardtothesameexpensecategoryastheawardrecipient'spayrollcosts.ThecostoftheRSUsisrecordedwithinequityuntilsettled.Equity-settledawardsarenotremeasuredsubsequenttotheinitialgrantdate.

RevenueRecognition

Revenuefromminingoperationsconsistsofgoldrevenues,netofsmelting,refining,transportationandothermarketingcharges.Revenuesfromby-productmetalsalesareshownnetofsmelterchargesaspartofrevenuesfromminingoperations.

Revenuefromthesaleofgoldandsilverisrecognizedwhenthefollowingconditionshavebeenmet:

• TheCompanyhastransferredtothebuyerthesignificantrisksandrewardsofownership;

• TheCompanyretainsneithercontinuingmanagerialinvolvementtothedegreeusuallyassociatedwithownershipnoreffectivecontroloverthegoodssold;

• Theamountofrevenuecanbemeasuredreliably;

• ItisprobablethattheeconomicbenefitsassociatedwiththetransactionwillflowtotheCompany;and

• Thecostsincurredortobeincurredinrespectofthetransactioncanbemeasuredreliably.

Revenuefromgoldandsilverintheformofdorebarsisrecordedwhentherefinedgoldorsilverissoldanddeliveredtothecustomer.Generally,allofthegoldandsilverintheformofdorebarsrecoveredintheCompany'smillingprocessissoldintheperiodinwhichitisproduced.

UnderthetermsoftheCompany'sconcentratesalescontractswiththird-partysmelters,finalpricesforthemetalscontainedintheconcentratearedeterminedbasedontheprevailingspotmarketmetalpricesonaspecifiedfuturedate,whichisestablishedasofthedatethattheconcentrateisdeliveredtothesmelter.TheCompanyrecordsrevenuesunderthesecontractsbasedonforwardpricesatthetimeofdelivery,whichiswhentherisksandrewardsofownershipoftheconcentratepassestothethird-partysmelters.Thetermsofthecontractsresultindifferencesbetweentherecordedestimatedpriceatdeliveryandthefinalsettlementprice.Thesedifferencesareadjustedthroughrevenueateachsubsequentfinancialstatementdate.

IncomeTaxes

Currenttaxanddeferredtaxexpensesarerecognizedintheconsolidatedstatementsofincomeexcepttotheextentthattheyrelatetoabusinesscombination,ortoitemsrecognizeddirectlyinequityorinothercomprehensiveincome(loss).

Currenttaxexpenseisbasedonsubstantivelyenactedstatutorytaxratesandlawsattheconsolidatedbalancesheetdate.

Deferredtaxisrecognizedinrespectoftemporarydifferencesbetweenthecarryingamountsofassetsandliabilitiesforfinancialreportingpurposesandthetaxbasisofsuchassetsandliabilitiesmeasuredusingtaxratesandlawsthataresubstantivelyenactedattheconsolidatedbalancesheetdateandeffectiveforthereportingperiodwhenthetemporarydifferencesareexpectedtoreverse.

Deferredtaxesarenotrecognizedinthefollowingcircumstances:

• Wherethedeferredtaxliabilityarisesfromtheinitialrecognitionofgoodwill;

• Wherethedeferredtaxassetorliabilityarisesontheinitialrecognitionofanassetorliabilityinanacquisitionthatisnotabusinesscombinationand,atthetimeoftheacquisition,affectsneithernetincomenorincomebeforeincomeandminingtaxes;and

• FortemporarydifferencesrelatingtoinvestmentsinsubsidiariesandjointlycontrolledentitiestotheextentthattheCompanycancontrolthetimingofthetemporarydifferenceanditisprobablethattheywillnotreverseintheforeseeablefuture.


Deferredtaxassetsarerecognizedforunusedlossescarriedforwardanddeductibletemporarydifferencestotheextentthatitisprobablethatfuturetaxablenetincomewillbeavailableagainstwhichtheycanbeutilizedexceptasnotedabove.

Ateachreportingperiod,previouslyunrecognizeddeferredtaxassetsarereassessedtodeterminewhetherithasbecomeprobablethatfuturetaxablenetincomewillallowthedeferredtaxassetstoberecovered.

Recently Issued Accounting Pronouncements

IFRS9–FinancialInstruments

InJuly2014,theIASBissuedIFRS9–Financial Instruments whichbringstogethertheclassificationandmeasurement,impairmentandhedgeaccountingphasesoftheIASB'sprojecttoreplaceIAS39–Financial Instruments: Recognition and Measurement .ApplicationofthestandardismandatoryforannualperiodsbeginningonorafterJanuary1,2018,withearlyadoptionpermitted.AgnicoEagleisevaluatingtheimpactoftheadoptionofIFRS9ontheCompany'sconsolidatedfinancialstatementsalongwiththetimingofadoption.

IFRS15–RevenuefromContractswithCustomers

InMay2014,theIASBissuedIFRS15–Revenue from Contracts with Customers ,whichestablishesprinciplesthatanentityshallapplytoreportusefulinformationtousersoffinancialstatementsaboutthenature,amount,timing,anduncertaintyofrevenueandcashflowsarisingfromacontractwithacustomer.ApplicationofthestandardismandatoryforannualreportingperiodsbeginningonorafterJanuary1,2018,withearlieradoptionpermitted.AgnicoEagleisevaluatingtheimpactoftheadoptionofIFRS15ontheCompany'sconsolidatedfinancialstatementsalongwiththetimingofadoption.

IFRS16–Leases

InJanuary2016,theIASBissuedIFRS16–Leases whichbringsmostleaseson-balancesheetforlesseesbyeliminatingthedistinctionbetweenoperatingandfinanceleases.Lessoraccountingremainslargelyunchangedandthedistinctionbetweenoperatingandfinanceleasesisretained.UnderIFRS16,alesseerecognizesaright-of-useassetandaleaseliability.Theright-of-useassetistreatedsimilarlytoothernon-financialassetsanddepreciatedaccordingly,andtheliabilityaccruesinterest.Theleaseliabilityisinitiallymeasuredatthepresentvalueoftheleasepaymentspayableovertheleaseterm,discountedattherateimplicitinthelease.Lesseesarepermittedtomakeanaccountingpolicyelection,byclassofunderlyingasset,toapplyamethodlikeIAS17'soperatingleaseaccountingandnotrecognizeleaseassetsandleaseliabilitiesforleaseswithaleasetermof12monthsorlessandonalease-by-leasebasis,toapplyamethodsimilartocurrentoperatingleaseaccountingtoleasesforwhichtheunderlyingassetisoflowvalue.IFRS16supersedesIAS17–Leases andrelatedinterpretationsandiseffectiveforperiodsbeginningonorafterJanuary1,2019,withearlieradoptionpermittedifIFRS15hasalsobeenapplied.AgnicoEagleiscurrentlyevaluatingtheimpactoftheadoptionofIFRS16ontheCompany'sconsolidatedfinancialstatementsalongwiththetimingofadoption.

Mineral Reserve Data

ThescientificandtechnicalinformationsetoutinthisMD&Ahasbeenapprovedbythefollowing"qualifiedpersons"asdefinedundertheCSA'sNationalInstrument43-101Standards of Disclosure for Mineral Properties :mineralreservesandmineralresources(otherthanfortheCanadianMalarticmine)–DanielDoucet,Eng.,SeniorCorporateDirector,ReserveDevelopment;mineralreservesandmineralresources(fortheCanadianMalarticmine)–DonaldGervais,P.Geo.,DirectorofTechnicalServicesatCanadianMalarticCorporation;Quebecoperations–ChristianProvencher,Eng.,Vice-President,Canada;Nunavutoperations–DominiqueGirard,Eng.,Vice-President,TechnicalServicesandNunavutOperations;Kittilaoperations–FrancisBrunet,Eng.,CorporateDirector,Mining;SouthernBusinessoperations–TimHaldane,P.Eng.,SeniorVice-President,Operations–USA&LatinAmerica;andexploration–AlainBlackburn,Eng.,SeniorVice-President,ExplorationandGuyGosselin,Eng.,Vice-President,Exploration.TheCompany'smineralreservesestimatewasderivedfrominternallygenerateddataorgeologyreports.

TheassumptionsusedforthemineralreserveestimatesatallminesandprojectsreportedinthisMD&A(excepttheCanadianMalarticmine)asatDecember31,2015are$1,100perouncegold,$16.00perouncesilver,$0.90perpoundzincand$2.50perpoundcopper.ExchangerateassumptionsofC$1.16perUS$1.00,€0.83perUS$1.00and14.00Mexicanpesosper$1.00wereusedforallminesandprojectsotherthantheLapamine,theMeadowbankmine,theCrestonMascotadepositatPinosAltosandtheSantoNinoopenpitatPinosAltos,whichusedexchangerateassumptionsofC$1.30perUS$1.00and16.00Mexicanpesosper$1.00duetotheirshorterminelives.TheassumptionsusedforthemineralreserveestimatesreportedinthisMD&AfortheCanadianMalarticmineasatDecember31,2015are$1,150perouncegoldandanexchangerateofC$1.24perUS$1.00.


Proven and Probable Mineral Reserves by Property (i) Tonnes

Gold Grade (Grams

per Tonne)

Contained Gold

(Ounces) (ii)

Proven Mineral Reserves

LaRondemine 3,455,000 4.09 454,000

Lapamine 444,000 5.49 78,000

Goldexmine 300,000 1.54 15,000

Meadowbankmine 1,203,000 1.51 58,000

CanadianMalarticmine(attributable50.0%) 27,446,000 0.97 860,000

Meliadineproject 34,000 7.31 8,000

Kittilamine 1,059,000 4.28 146,000

PinosAltosmine 2,769,000 3.08 274,000

CrestonMascotadepositatPinosAltos 187,000 0.68 4,000

LaIndiamine 244,000 0.68 5,000

Total Proven Mineral Reserves 37,141,000 1.59 1,903,000

Probable Mineral Reserves

LaRondemine 14,765,000 5.59 2,654,000

Goldexmine 12,644,000 1.61 653,000

Akasabaproject 4,759,000 0.92 141,000

Meadowbankmine 9,586,000 2.87 885,000

CanadianMalarticmine(attributable50.0%) 83,320,000 1.12 3,002,000

Meliadineproject 14,495,000 7.32 3,410,000

Kittilamine 27,136,000 4.82 4,208,000

PinosAltosmine 12,967,000 2.84 1,185,000

CrestonMascotadepositatPinosAltos 4,026,000 1.33 172,000

LaIndiamine 29,743,000 0.90 862,000

Total Probable Mineral Reserves 213,442,000 2.50 17,172,000

Total Proven and Probable Mineral Reserves 250,583,000 2.37 19,075,000

Notes:

(i) Completeinformationontheverificationprocedures,qualityassuranceprogram,qualitycontrolprocedures,operatingandcapitalcostassumptions,parametersandmethodsandotherfactorsthatmaymateriallyaffectscientificandtechnicalinformationpresentedinthisMD&Aanddefinitionsofcertaintermsusedhereinmaybefoundin:theAIFunderthecaption"InformationonMineralReservesandMineralResourcesoftheCompany";the2005LaRondeMineralResource&MineralReserveEstimatefiledwithCanadiansecuritiesregulatoryauthoritiesonSEDARonMarch23,2005;theTechnicalReportontheLapaGoldProjectfiledwithCanadiansecuritiesregulatoryauthoritiesonSEDARonJune8,2006;theTechnicalReportontheDecember31,2009MineralReserveandMineralResourceEstimateandtheSuuriExtensionProject,KittilaMine,FinlandfiledwiththeCanadiansecuritiesregulatoryauthoritiesonSEDARonMarch4,2010;theTechnicalReportontheMineralResourcesandMineralReservesatMeadowbankGoldMine,Nunavut,CanadaasatDecember31,2011filedwithCanadiansecuritiesregulatoryauthoritiesonSEDARonMarch23,2012;thePinosAltosGold-SilverMiningProject,ChihuahuaState,Mexico,TechnicalReportonMineralResourcesandReservesasofDecember31,2008filedwithCanadiansecuritiesregulatoryauthoritiesonMarch25,2009;theUpdatedTechnicalReportontheMeliadineGoldProject,Nunavut,CanadadatedFebruary11,2015filedwithCanadiansecuritiesregulatoryauthoritiesonSEDARonMarch12,2015;theTechnicalReportontheJune30,2012UpdateoftheMineralResourcesandMineralReserves,LaIndiaGoldProject,MunicipalityofSahuaripa,Sonora,MexicodatedAugust31,2012filedwithCanadiansecuritiesregulatoryauthoritiesonSEDARonOctober12,2012;theTechnicalReportonRestatementoftheMineralResourcesatGoldexMine,

Quebec,CanadaasatOctober19,2011filedwithCanadiansecuritiesregulatoryauthoritiesonSEDARonDecember5,2011;theTechnicalReportonProductionoftheMandEZonesatGoldexMinedatedOctober14,2012filedwiththeCanadiansecuritiesregulatoryauthoritiesonSEDARonNovember1,2012;andtheTechnicalReportontheMineralResourceandMineralReserveEstimatesfortheCanadianMalarticPropertyasatJune16,2014filedwithCanadiansecuritiesregulatoryauthoritiesonSEDARonAugust13,2014.

(ii) Totalcontainedgoldouncesdoesnotincludeequivalentgoldouncesfortheby-productmetalscontainedinthemineralreserves.


Non-GAAP Financial Performance Measures

ThisMD&Apresentscertainfinancialperformancemeasures,includingadjustednetincome,totalcashcostsperounceofgoldproduced(onbothaby-productandco-productbasis),minesitecostspertonneandall-insustainingcostsperounceofgoldproduced,thatarenotrecognizedmeasuresunderIFRS.Thisdatamaynotbecomparabletodatapresentedbyothergoldproducers.Non-GAAPfinancialperformancemeasuresshouldbeconsideredtogetherwithotherdatapreparedinaccordancewithIFRS.

AdjustedNetIncome

AdjustednetincomeisnotarecognizedmeasureunderIFRSandthisdatamaynotbecomparabletodatapresentedbyothergoldproducers.Thismeasureiscalculatedbyadjustingnetincome(loss)asrecordedintheconsolidatedstatementsofincome(loss)andcomprehensiveincome(loss)fornon-recurring,unusualandotheritems.TheCompanybelievesthatthisgenerallyacceptedindustrymeasureallowstheevaluationoftheresultsofcontinuingoperationsandisusefulinmakingcomparisonsbetweenperiods.AdjustednetincomeisintendedtoprovideinvestorswithinformationabouttheCompany'scontinuingincomegeneratingcapabilities.ManagementusesthismeasuretomonitorandplanfortheoperatingperformanceoftheCompanyinconjunctionwithotherdatapreparedinaccordancewithIFRS.

2015 2014 2013

(thousands of United States dollars) Net income (loss) for the period – basic $ 24,583 $ 82,970 $ (686,705)

Less:DilutiveimpactofCMGPConvertibleDebentures(i) – (7,345) –

Net income (loss) for the period – diluted $ 24,583 $ 75,625 $ (686,705)

Impairmentlossonavailable-for-salesecurities 12,035 15,763 32,476

Gainonsaleofavailable-for-salesecurities (24,600) (5,635) (74)

Foreigncurrencytranslation(gain)loss (4,728) 3,781 1,769

Lossonderivativefinancialinstruments 19,608 6,156 268

Stockoptionsexpense 19,490 20,092 26,398

Mark-to-marketloss(gain)onCMGPConvertibleDebentures(ii) 2,416 (7,995) –

Impairmentloss,netoftax – – 748,157

Incomeandminingtaxesadjustments 24,742 23,323 44,256

Other 19,442 5,832 21,097

Adjusted net income for the period – basic $ 92,988 $ 144,287 $ 187,642

Adjusted net income for the period – diluted $ 92,988 $ 144,937 $ 187,642

Netincome(loss)pershare–basic $ 0.11 $ 0.43 $ (3.97)

Netincome(loss)pershare–diluted $ 0.11 $ 0.39 $ (3.97)

Adjustednetincomepershare–basic $ 0.43 $ 0.74 $ 1.09

Adjustednetincomepershare–diluted $ 0.43 $ 0.74 $ 1.09

Notes:

(i) InconnectionwiththejointacquisitionofOsiskoonJune16,2014,AgnicoEagleindirectlyassumeditsattributableinterestintheCMGPConvertibleDebentures.OnJune30,2015,thenegotiatedearlysettlementofalltheCMGPConvertibleDebentureswascompleted,resultinginprincipaloutstandingofnil.TheimpactoftheCMGPConvertibleDebentureshasbeenincludedinthecalculationofdilutednetincome,dilutedadjustednetincome,dilutednetincomepershareanddilutedadjustednetincomepersharewheredilutiveandhasbeenexcludedfromthecalculationofdilutednetincome,dilutedadjustednetincome,dilutednetincomepershareanddilutedadjustednetincomepersharewhereanti-dilutive.ThedilutiveimpactofCMGPtheConvertibleDebentureswasexcludedfromthecalculationofdilutednetincome,dilutedadjustednetincome,dilutednetincomepershareanddilutedadjustednetincomepersharefortheyearendedDecember31,2015astheirimpactwouldhavebeenanti-dilutivefortheportionoftheyeartheywereoutstanding.

(ii) WheretheimpactoftheCMGPConvertibleDebenturesisdilutive,theadjustmentformark-to-marketloss(gain)onCMGPConvertibleDebenturesisexcludedfromthecalculationofadjustednetincomefortheperiodonadilutedbasisasitisalreadyincorporatedinthecalculationofnetincome(loss)fortheperiodonadilutedbasis.


TotalCashCostsperOunceofGoldProducedandMinesiteCostsperTonne

TheCompanybelievesthattotalcashcostsperounceofgoldproducedandminesitecostspertonnearerealisticindicatorsofoperatingperformanceandfacilitateperiodoverperiodcomparisons.However,bothofthesenon-GAAPgenerallyacceptedindustrymeasuresshouldbeconsideredtogetherwithotherdatapreparedinaccordancewithIFRS.Thesemeasures,takenbythemselves,arenotnecessarilyindicativeofoperatingcostsorcashflowmeasurespreparedinaccordancewithIFRS.

Totalcashcostsperounceofgoldproducediscalculatedonbothaby-productbasis(deductingby-productmetalrevenuesfromproductioncosts)andco-productbasis(beforeby-productmetalrevenues).Totalcashcostsperounceofgoldproducedonaby-productbasisiscalculatedbyadjustingproductioncostsasrecordedintheconsolidatedstatementsofincomeandcomprehensiveincomeforby-productrevenues,unsoldconcentrateinventoryproductioncosts,smelting,refiningandmarketingchargesandotheradjustments,andthendividingbythenumberofouncesofgoldproduced.Totalcashcostsperounceofgoldproducedonaco-productbasisiscalculatedinthesamemannerastotalcashcostsperounceofgoldproducedonaby-productbasisexceptthatnoadjustmentforby-productmetalrevenuesismade.Accordingly,thecalculationoftotalcashcostsperounceofgoldproducedonaco-productbasisdoesnotreflectareductioninproductioncostsorsmelting,refiningandmarketingchargesassociatedwiththeproductionandsaleofby-productmetals.TotalcashcostsperounceofgoldproducedisintendedtoprovideinformationaboutthecashgeneratingcapabilitiesoftheCompany'sminingoperations.ManagementalsousesthesemeasurestomonitortheperformanceoftheCompany'sminingoperations.Asmarketpricesforgoldarequotedonaperouncebasis,usingthetotalcashcostperounceofgoldproducedonaby-productbasismeasureallowsmanagementtoassessamine'scashgeneratingcapabilitiesatvariousgoldprices.Managementisawarethattheseperouncemeasuresofperformancecanbeaffectedbyfluctuationsinexchangeratesand,inthecaseoftotalcashcostsperounceofgoldproducedonaby-productbasis,by-productmetalprices.Managementcompensatesfortheseinherentlimitationsbyusingthesemeasuresinconjunctionwithminesitecostspertonne(discussedbelow)aswellasotherdatapreparedinaccordancewithIFRS.Managementalsoperformssensitivityanalysesinordertoquantifytheeffectsoffluctuatingmetalpricesandexchangerates.

AgnicoEagle'sprimarybusinessisgoldproductionandthefocusofitscurrentoperationsandfuturedevelopmentisonmaximizingreturnsfromgoldproduction,withothermetalproductionbeingincidentaltothegoldproductionprocess.Accordingly,allmetalsotherthangoldareconsideredby-products.

Totalcashcostsperounceofgoldproducedispresentedonaby-productbasisbecause(i)themajorityoftheCompany'srevenuesaregoldrevenues,(ii)theCompanyminesore,whichcontainsgold,silver,zinc,copperandothermetals,(iii)itisnotpossibletospecificallyassignallcoststorevenuesfromthegold,silver,zinc,copperandothermetalstheCompanyproduces,and(iv)itisamethodusedbymanagementandtheBoardtomonitoroperations.

Minesitecostspertonneiscalculatedbyadjustingproductioncostsasshownintheconsolidatedstatementsofincomeandcomprehensiveincomeforunsoldconcentrateinventoryproductioncostsandotheradjustmentsandthendividingbytonnesoforeprocessed.Asthetotalcashcostsperounceofgoldproducedmeasurecanbeaffectedbyfluctuationsinby-productmetalpricesandexchangerates,managementbelievesthattheminesitecostspertonnemeasureprovidesadditionalinformationregardingtheperformanceofminingoperations.Managementalsousesminesitecostspertonnetodeterminetheeconomicviabilityofminingblocks.Aseachminingblockisevaluatedbasedonthenetrealizablevalueofeachtonnemined,inordertobeeconomicallyviabletheestimatedrevenueonapertonnebasismustbeinexcessoftheminesitecostspertonne.ManagementisawarethatthispertonnemeasureofperformancecanbeaffectedbyfluctuationsinproductionlevelsandcompensatesforthisinherentlimitationbyusingthismeasureinconjunctionwithproductioncostspreparedinaccordancewithIFRS.

TotalcashcostsperounceofgoldproducedandminesitecostspertonnehavebeenrestatedtoconformwithIFRSforallreportedperiods.

Thefollowingtablessetoutareconciliationoftotalcashcostsperounceofgoldproduced(onbothaby-productbasisandco-productbasis)andminesitecostspertonnetoproductioncosts,exclusiveofamortization,aspresentedintheconsolidatedstatementsofincomeandcomprehensiveincomeinaccordancewithIFRS.


TotalProductionCostsbyMine


2015


2014


2013

(thousands of United States dollars) LaRondemine $ 172,283 $ 188,736 $ 228,640

Lapamine 52,571 61,056 69,371

Goldexmine(i) 61,278 64,836 15,339

Meadowbankmine 230,564 270,824 318,414

CanadianMalarticmine(ii) 171,473 113,916 –

Kittilamine(iii) 126,095 116,893 97,934

PinosAltosmine 105,175 123,342 116,959

CrestonMascotadepositatPinosAltos(iv) 26,278 28,007 19,425

LaIndiamine(v) 49,578 36,949 –

Productioncostspertheconsolidatedstatementsofincomeandcomprehensiveincome $ 995,295 $ 1,004,559 $ 866,082

ReconciliationofProductionCoststoTotalCashCostsperOunceofGoldProduced(vi)byMineandReconciliationofProductionCoststoMinesiteCostsperTonne(vii)byMine

LaRonde Mine – Total Cash Costs per Ounce of Gold Produced (vi)


2015


2014


2013

(thousands of United States dollars, except as noted) Productioncosts $ 172,283 $ 188,736 $ 228,640

Adjustments:

Inventoryandotheradjustments(viii) 31,417 27,070 31,855

Cashoperatingcosts(co-productbasis) $ 203,700 $ 215,806 $ 260,495

By-productmetalrevenues (45,678) (79,015) (121,035)

Cashoperatingcosts(by-productbasis) $ 158,022 $ 136,791 $ 139,460

Goldproduction(ounces) 267,921 204,652 181,781

Totalcashcostsperounceofgoldproduced($perounce)(vi):

Co-productbasis $ 760 $ 1,055 $ 1,433

By-productbasis $ 590 $ 668 $ 767


LaRonde Mine – Minesite Costs per Tonne (vii)


2015


2014


2013


Inventoryandotheradjustments(ix) 2,582 (1,511) (6,259)

Minesiteoperatingcosts $ 174,865 $ 187,225 $ 222,381

Minesiteoperatingcosts(thousandsofC$) C$ 222,799 C$ 206,858 C$ 229,004

Tonnesoforemilled(thousandsoftonnes) 2,241 2,085 2,319

Minesitecostspertonne(C$)(vii) C$ 99 C$ 99 C$ 99

Lapa Mine – Total Cash Costs per Ounce of Gold Produced (vi)


2015


2014


2013


Adjustments:

Inventoryandotheradjustments(viii) 1,161 750 (1,105)


By-productmetalrevenues (62) (61) (22)




Co-productbasis $ 591 $ 667 $ 678


Lapa Mine – Minesite Costs per Tonne (vii)


2015


2014


2013


Inventoryandotheradjustments(ix) (1,000) 545 (1,216)



Tonnesoforemilled(thousandsoftonnes) 560 639 640



Goldex Mine – Total Cash Costs per Ounce of Gold Produced (i)(vi)


2015


2014


2013


Adjustments:

Inventoryandotheradjustments(viii) 878 (720) 1,924








Goldex Mine – Minesite Costs per Tonne (i)(vii)


2015


2014


2013


Inventoryandotheradjustments(ix) (1,253) (797) 1,895



Tonnesoforemilled(thousandsoftonnes) 2,313 2,117 492


Meadowbank Mine – Total Cash Costs per Ounce of Gold Produced (vi)


2015


2014


2013


Adjustments:

Inventoryandotheradjustments(viii) 7,282 2,688 (4,601)


By-productmetalrevenues (3,665) (2,420) (2,343)




Meadowbank Mine – Minesite Costs per Tonne (vii)


2015


2014


2013


Inventoryandotheradjustments(ix) (4,441) 2,539 (5,222)



Tonnesoforemilled(thousandsoftonnes) 4,033 4,129 4,143


Canadian Malartic Mine – Total Cash Costs per Ounce of Gold Produced (ii)(vi)


2015


2014


2013

(thousands of United States dollars, except as noted) Productioncosts $ 171,473 $ 113,916 $ –

Adjustments:

Inventoryandotheradjustments(viii) 3,630 (10,862) –

Cashoperatingcosts(co-productbasis) $ 175,103 $ 103,054 $ –

By-productmetalrevenues (4,689) (2,771) –

Cashoperatingcosts(by-productbasis) $ 170,414 $ 100,283 $ –

Goldproduction(ounces) 285,809 143,008 –


Co-productbasis $ 613 $ 721 $ –

By-productbasis $ 596 $ 701 $ –

Canadian Malartic Mine – Minesite Costs per Tonne (ii)(vii)


2015


2014


2013


Inventoryandotheradjustments(ix) 1,784 (11,656) –

Minesiteoperatingcosts $ 173,257 $ 102,260 $ –

Minesiteoperatingcosts(thousandsofC$) C$ 219,714 C$ 113,818 C$ –

Tonnesoforemilled(thousandsoftonnes) 9,545 5,263 –

Minesitecostspertonne(C$)(vii) C$ 23 C$ 22 C$ –


Kittila Mine – Total Cash Costs per Ounce of Gold Produced (iii)(vi)


2015


2014


2013


Adjustments:

Inventoryandotheradjustments(iii)(viii) (187) 3,051 (13,442)








Kittila Mine – Minesite Costs per Tonne (iii)(vii)


2015


2014


2013


Inventoryandotheradjustments(iii)(ix) (374) 2,560 (13,848)


Minesiteoperatingcosts(thousandsof€) € 111,329 € 89,987 € 64,102

Tonnesoforemilled(thousandsoftonnes) 1,464 1,156 883

Minesitecostspertonne(€)(vii) € 76 € 78 € 73

Pinos Altos Mine – Total Cash Costs per Ounce of Gold Produced (vi)


2015


2014


2013


Adjustments: Inventoryandotheradjustments(viii) 6,458 (581) 2,473

Cashoperatingcosts(co-productbasis) $ 111,633 $ 122,761 $ 119,432 By-productmetalrevenues (37,030) (31,643) (51,773)





Pinos Altos Mine – Minesite Costs per Tonne (vii)


2015


2014


2013


Inventoryandotheradjustments(ix) 2,481 (2,376) (821)


Tonnesoforeprocessed(thousandsoftonnes) 2,378 2,520 2,726

Minesitecostspertonne(US$)(vii) $ 45 $ 48 $ 43

Creston Mascota deposit at Pinos Altos – Total Cash Costs perOunce of Gold Produced (iv)(vi)


2015


2014


2013


Adjustments:

Inventoryandotheradjustments(iv)(viii) (328) 1,232 (2,289)


By-productmetalrevenues (2,412) (1,574) (795)






Creston Mascota deposit at Pinos Altos – Minesite Costs per Tonne(iv)(vii)


2015


2014


2013


Inventoryandotheradjustments(iv)(ix) (757) 870 (2,564)


Tonnesoforeprocessed(thousandsoftonnes) 2,099 1,794 1,023

Minesitecostspertonne(US$)(vii) $ 12 $ 16 $ 16


La India Mine – Total Cash Costs per Ounce of Gold Produced (v)(vi)


2015


2014


2013


Adjustments:

Inventoryandotheradjustments(viii) (28) 1,172 –

Cashoperatingcosts(co-productbasis) $ 49,550 $ 38,121 $ –

By-productmetalrevenues (4,058) (3,230) –

Cashoperatingcosts(by-productbasis) $ 45,492 $ 34,891 $ –

Goldproduction(ounces)(v) 104,362 71,601 –


Co-productbasis $ 475 $ 532 $ –

By-productbasis $ 436 $ 487 $ –

La India Mine – Minesite Costs per Tonne (v)(vii)


2015


2014


2013


Inventoryandotheradjustments(ix) (657) 778 –

Minesiteoperatingcosts $ 48,921 $ 37,727 $ –

Tonnesoforeprocessed(thousandsoftonnes) 5,371 4,442 –

Minesitecostspertonne(US$)(vii) $ 9 $ 8 $ –

Notes:

(i) TheGoldexmine'sMandEZonesachievedcommercialproductiononOctober1,2013.

(ii) OnJune16,2014,AgnicoEagleandYamanajointlyacquired100.0%ofOsiskobywayoftheOsiskoArrangement.AsaresultoftheOsiskoArrangement,AgnicoEagleandYamanaeachindirectlyown50.0%ofOsisko(nowCanadianMalarticCorporation)andCanadianMalarticGP,whichnowholdstheCanadianMalarticmine.TheinformationsetoutinthistablereflectstheCompany's50.0%interestintheCanadianMalarticminesincethedateofacquisition.

(iii) ThecalculationsoftotalcashcostsperounceofgoldproducedandminesitecostspertonneexcludetheKittilamine'sresultsforthesecondquarterof2013.Duetoanextendedmaintenanceshutdown,theKittilamineonlyoperatedfor14daysduringthesecondquarterof2013.TheKittilamineincurred$18,159inproductioncostsduringthesecondquarterof2013,whichwereremovedfromthecalculationoftotalcashcostsperounceofgoldproducedandminesitecostspertonnebymeansoftheinventoryandotheradjustmentslineintheirrespectivereconciliationtables.

(iv) ThecalculationsoftotalcashcostsperounceofgoldproducedandminesitecostspertonneexcludetheCrestonMascotadepositatPinosAltos'resultsforthefirstquarterof2013duetothetemporarysuspensionofactiveleachingbetweenOctober1,2012andMarch13,2013.TheCrestonMascotadepositatPinosAltosincurred$3,117inproductioncostsduringthefirstquarterof2013,whichwereremovedfromthecalculationoftotalcashcostsperounceofgoldproducedandminesitecostspertonnebymeansoftheinventoryandotheradjustmentslineintheirrespectivereconciliationtables.

(v) TheLaIndiamineachievedcommercialproductiononFebruary1,2014.ThecalculationoftotalcashcostsperounceofgoldproducedintheyearendedDecember31,2014excludes3,492ouncesofpayablegoldproductionastheywereproducedpriortotheachievementofcommercialproduction.

(vi) TotalcashcostsperounceofgoldproducedisnotarecognizedmeasureunderIFRSandthisdatamaynotbecomparabletodatapresentedbyothergoldproducers.Totalcashcostsperounceofgoldproducedispresentedonbothaby-productbasis(deductingby-productmetalrevenuesfromproductioncosts)andco-productbasis(beforeby-productmetalrevenues).Totalcashcostsperounceofgoldproducedonaby-productbasisiscalculatedbyadjustingproductioncostsasrecordedintheconsolidatedstatementsofincomeandcomprehensiveincomeforby-productmetalrevenues,unsoldconcentrateinventoryproductioncosts,smelting,refiningandmarketingchargesandotheradjustments,andthendividingbythenumberofouncesofgoldproduced.Totalcashcostsperounceofgoldproducedonaco-productbasisiscalculatedinthesamemannerastotalcashcostsperounceofgoldproducedonaby-productbasisexceptthatnoadjustmentforby-productmetalrevenuesismade.Thecalculationoftotalcashcostsperounceofgoldproducedonaco-productbasisdoesnotreflectareductioninproductioncostsorsmelting,refiningandmarketingchargesassociatedwiththeproductionandsaleofby-productmetals.TheCompanybelievesthatthesegenerallyacceptedindustrymeasuresprovidearealisticindicationofoperatingperformanceandprovideusefulcomparisonpointsbetweenperiods.TotalcashcostsperounceofgoldproducedisintendedtoprovideinformationaboutthecashgeneratingcapabilitiesoftheCompany'sminingoperations.ManagementalsousesthesemeasurestomonitortheperformanceoftheCompany'sminingoperations.Asmarketpricesforgoldarequotedonaperouncebasis,usingthetotalcashcostsperounceofgoldproducedonaby-product

basismeasureallowsmanagementtoassessamine'scashgeneratingcapabilitiesatvariousgoldprices.Managementisawarethattheseperouncemeasuresofperformancecanbeaffectedbyfluctuationsinexchangeratesand,inthecaseoftotalcashcostsofgoldproducedonaby-productbasis,


by-productmetalprices.Managementcompensatesfortheseinherentlimitationsbyusingthesemeasuresinconjunctionwithminesitecostspertonne(discussedbelow)aswellasotherdatapreparedinaccordancewithIFRS.Managementalsoperformssensitivityanalysesinordertoquantifytheeffectsoffluctuatingmetalpricesandexchangerates.

(vii) MinesitecostspertonneisnotarecognizedmeasureunderIFRSandthisdatamaynotbecomparabletodatapresentedbyothergoldproducers.Thismeasureiscalculatedbyadjustingproductioncostsasshownintheconsolidatedstatementsofincomeandcomprehensiveincomeforunsoldconcentrateinventoryproductioncosts,andthendividingbytonnesoforemilled.Asthetotalcashcostsperounceofgoldproducedmeasurecanbeimpactedbyfluctuationsinby-productmetalpricesandexchangerates,managementbelievesthattheminesitecostspertonnemeasureprovidesadditionalinformationregardingtheperformanceofminingoperations,eliminatingtheimpactofvaryingproductionlevels.Managementalsousesthismeasuretodeterminetheeconomicviabilityofminingblocks.Aseachminingblockisevaluatedbasedonthenetrealizablevalueofeachtonnemined,inordertobeeconomicallyviabletheestimatedrevenueonapertonnebasismustbeinexcessoftheminesitecostspertonne.ManagementisawarethatthispertonnemeasureofperformancecanbeimpactedbyfluctuationsinprocessinglevelsandcompensatesforthisinherentlimitationbyusingthismeasureinconjunctionwithproductioncostspreparedinaccordancewithIFRS.

(viii) UndertheCompany'srevenuerecognitionpolicy,revenueisrecognizedonconcentrateswhenlegaltitleandriskistransferred.Astotalcashcostsperounceofgoldproducedarecalculatedonaproductionbasis,aninventoryadjustmentismadetoreflectthesalesmarginontheportionofconcentrateproductionnotyetrecognizedasrevenue.Otheradjustmentsincludetheadditionofsmelting,refiningandmarketingchargestoproductioncosts.

(ix) Thisinventoryandotheradjustmentreflectsproductioncostsassociatedwithunsoldconcentrates.

All-inSustainingCostsperOunceofGoldProduced

All-insustainingcostsperounceofgoldproducedisnotarecognizedmeasureunderIFRSandthisdatamaynotbecomparabletodatapresentedbyothergoldproducers.TheCompanybelievesthatthismeasureprovidesinformationaboutoperatingperformance.However,thisnon-GAAPmeasureshouldbeconsideredtogetherwithotherdatapreparedinaccordancewithIFRSasitisnotnecessarilyindicativeofoperatingcostsorcashflowmeasurespreparedinaccordancewithIFRS.

BasedontherecommendationsoftheWorldGoldCouncilmadein2013,theCompanymodifieditscalculationofall-insustainingcostsperounceofgoldproducedbeginningin2014.All-insustainingcostsperounceofgoldproducedispresentedonbothaby-productbasis(deductingby-productmetalrevenuesfromproductioncosts)andco-productbasis(beforeby-productmetalrevenues).All-insustainingcostsperounceofgoldproducedonaby-productbasisiscalculatedastheaggregateoftotalcashcostsperounceofgoldproducedonaby-productbasisandsustainingcapitalexpenditures(includingcapitalizedexploration),generalandadministrativeexpenses(includingstockoptions)andnon-cashreclamationprovisionexpenseperounceofgoldproduced.All-insustainingcostsperounceofgoldproducedonaco-productbasisiscalculatedinthesamemannerasall-insustainingcostsperounceofgoldproducedonaby-productbasisexceptthatnoadjustmentforby-productmetalrevenuesismadetototalcashcostsperounceofgoldproduced.Thecalculationofall-insustainingcostsperounceofgoldproducedonaco-productbasisdoesnotreflectareductioninproductioncostsorsmelting,refiningandmarketingchargesassociatedwiththeproductionandsaleofby-productmetals.

Priortomodifyingitscalculationofall-insustainingcostsperounceofgoldproducedfor2014basedontherecommendationsoftheWorldGoldCouncil,theCompanycalculatedall-insustainingcostsperounceofgoldproducedonaby-productbasisastheaggregateoftotalcashcostsperounceofgoldproducedonaby-productbasisandsustainingcapitalexpenditures,generalandadministrativeexpenses(netofstockoptions)andexplorationandcorporatedevelopmentexpenses(excludinggreenfieldexploration)perounceofgoldproduced.All-insustainingcostsperounceofgoldproducedonaco-productbasiswouldhavebeencalculatedinthesamemannerasall-insustainingcostsperounceofgoldproducedonaby-productbasisexceptthatnoadjustmentforby-productmetalrevenues,netofsmelting,refiningandmarketingchargeswouldhavebeenmadetototalcashcostsperounceofgoldproduced.


ReconciliationofProductionCoststoAll-inSustainingCostsperOunceofGoldProduced

(United States dollars per ounce of gold produced, except where noted)


2015


2014

Productioncostspertheconsolidatedstatementsofincome(loss)(thousandsofUnitedStatesdollars) $995,295 $1,004,559

Adjustedgoldproduction(ounces)(i) 1,671,340 1,425,796

Productioncostsperounceofadjustedgoldproduction:(i) $596 $705

Adjustments:

Inventoryandotheradjustments(ii) 30 16

Totalcashcostsperounceofgoldproduced–co-productbasis(iii) $626 $721

By-productmetalrevenues (59) (84)

Totalcashcostsperounceofgoldproduced–by-productbasis(iii) $567 $637

Adjustments:

Sustainingcapitalexpenditures(includingcapitalizedexploration) 183 230

Generalandadministrativeexpenses(includingstockoptions) 58 83

Non-cashreclamationprovisionandother 2 4

All-insustainingcostsperounceofgoldproduced–by-productbasis $810 $954

By-productmetalrevenues 59 84

All-insustainingcostsperounceofgoldproduced–co-productbasis $869 $1,038

Notes:

(i) TheLaIndiamineachievedcommercialproductiononFebruary1,2014.ThecalculationoftotalcashcostsperounceofgoldproducedfortheyearendedDecember31,2014excludes3,492ouncesofpayablegoldproductionastheywereproducedpriortotheachievementofcommercialproduction.

(ii) UndertheCompany'srevenuerecognitionpolicy,revenueisrecognizedonconcentrateswhenlegaltitleandriskistransferred.Astotalcashcostsperounceofgoldproducedarecalculatedonaproductionbasis,thisinventoryadjustmentreflectsthesalesmarginontheportionofconcentrateproductionnotyetrecognizedasrevenue.

(iii) TotalcashcostsperounceofgoldproducedisnotarecognizedmeasureunderIFRSandthisdatamaynotbecomparabletodatapresentedbyothergoldproducers.Totalcashcostsperounceofgoldproducedispresentedonbothaby-productbasis(deductingby-productmetalrevenuesfromproductioncosts)andco-productbasis(beforeby-productmetalrevenues).Totalcashcostsperounceofgoldproducedonaby-productbasisiscalculatedbyadjustingproductioncostsasrecordedintheconsolidatedstatementsofincomeandcomprehensiveincomeforby-productmetalrevenues,unsoldconcentrateinventoryproductioncosts,smelting,refiningandmarketingchargesandotheradjustments,andthendividingbythenumberofouncesofgoldproduced.Totalcashcostsperounceofgoldproducedonaco-productbasisiscalculatedinthesamemannerastotalcashcostsperounceofgoldproducedonaby-productbasisexceptthatnoadjustmentforby-productmetalrevenuesismade.Accordingly,thecalculationoftotalcashcostsperounceofgoldproducedonaco-productbasisdoesnotreflectareductioninproductioncostsorsmelting,refiningandmarketingchargesassociatedwiththeproductionandsaleofby-productmetals.TheCompanybelievesthatthesegenerallyacceptedindustrymeasuresprovidearealisticindicationofoperatingperformanceandprovideusefulcomparisonpointsbetweenperiods.TotalcashcostsperounceofgoldproducedisintendedtoprovideinformationaboutthecashgeneratingcapabilitiesoftheCompany'sminingoperations.ManagementalsousesthesemeasurestomonitortheperformanceoftheCompany'sminingoperations.Asmarketpricesforgoldarequotedonaperouncebasis,usingthetotalcashcostsperounceofgoldproducedonaby-productbasismeasureallowsmanagementtoassessamine'scashgeneratingcapabilitiesatvariousgoldprices.Managementisawarethattheseperouncemeasuresofperformancecanbeaffectedbyfluctuationsinexchangeratesand,inthecaseoftotalcashcostsofgoldproducedonaby-productbasis,by-productmetalprices.ManagementcompensatesfortheseinherentlimitationsbyusingthesemeasuresinconjunctionwithminesitecostspertonneaswellasotherdatapreparedinaccordancewithIFRS.Managementalsoperformssensitivityanalysesinordertoquantifytheeffectsoffluctuatingmetalpricesandexchangerates.


SUMMARIZED QUARTERLY DATA (thousands of United States dollars, except where noted)

Three Months Ended

March 31,

2015 June 30,

2015 September 30,

2015 December 31,

2015 Total 2015

Operating margin (i) :

Revenuesfromminingoperations $ 483,596 $ 510,109 $ 508,795 $ 482,932 $ 1,985,432

Productioncosts 247,280 263,612 254,584 229,819 995,295

Totaloperatingmargin(i) 236,316 246,497 254,211 253,113 990,137

Operating margin (i) by mine:

NorthernBusiness

LaRondemine 30,015 32,799 32,443 50,667 145,924

Lapamine 14,687 11,351 13,813 12,363 52,214

Goldexmine 19,253 15,525 20,681 17,108 72,567

Meadowbankmine 46,577 49,600 55,493 64,664 216,334

CanadianMalarticmine(ii) 34,718 44,737 44,293 38,059 161,807

Kittilamine 27,415 16,145 21,528 15,174 80,262

SouthernBusiness

PinosAltosmine 34,652 44,538 37,217 29,327 145,734

CrestonMascotadepositatPinosAltos 8,409 12,968 8,898 9,919 40,194

LaIndiamine 20,590 18,834 19,845 15,832 75,101



Exploration,corporateandother 43,706 67,973 110,258 76,963 298,900

Income(loss)beforeincomeandminingtaxes 56,713 20,909 (14,015) 19,021 82,628

Incomeandminingtaxes(recovery) 27,970 10,826 (15,309) 34,558 58,045

Netincome(loss)fortheperiod $ 28,743 $ 10,083 $ 1,294 $ (15,537) $ 24,583

Netincome(loss)pershare–basic(US$) $ 0.13 $ 0.05 $ 0.01 $ (0.07) $ 0.11

Netincome(loss)pershare–diluted(US$) $ 0.13 $ 0.05 $ 0.01 $ (0.07) $ 0.11

Cash flows:

Cashprovidedbyoperatingactivities $ 143,455 $ 188,349 $ 143,687 $ 140,747 $ 616,238

Cashusedininvestingactivities $ (53,892) $ (104,476) $ (100,365) $ (115,786) $ (374,519)

Cash(usedin)providedbyfinancingactivities $ (123,182) $ (64,514) $ 7,396 $ (100,460) $ (280,760)

Realized prices (US$):

Gold(perounce) $ 1,202 $ 1,196 $ 1,119 $ 1,094 $ 1,156

Silver(perounce) $ 17.02 $ 16.41 $ 14.93 $ 14.56 $ 15.63

Zinc(pertonne) $ 2,072 $ 2,231 $ 1,909 $ 1,602 $ 1,875

Copper(pertonne) $ 5,056 $ 6,274 $ 4,538 $ 4,568 $ 5,023

Payable production (iii) :

Gold(ounces):

NorthernBusiness

LaRondemine 58,893 64,007 71,860 73,161 267,921

Lapamine 25,920 19,450 25,668 19,929 90,967

Goldexmine 29,250 26,462 32,068 27,646 115,426

Meadowbankmine 88,523 91,276 99,425 102,580 381,804

CanadianMalarticmine(ii) 67,893 68,441 76,603 72,872 285,809

Kittilamine 44,654 41,986 46,455 44,279 177,374

SouthernBusiness

PinosAltosmine 50,106 50,647 47,725 44,496 192,974


LaIndiamine 26,523 25,803 28,604 23,432 104,362

Totalgold(ounces) 404,210 403,678 441,124 422,328 1,671,340

Silver(thousandsofounces):

NorthernBusiness

LaRondemine 198 201 221 296 916

Lapamine 1 1 1 1 4

Meadowbankmine 96 57 39 29 221

CanadianMalarticmine(ii) 72 69 76 83 300

Kittilamine 2 2 3 4 11

SouthernBusiness

PinosAltosmine 562 576 606 640 2,384

CrestonMascotadepositatPinosAltos 32 37 40 50 159

LaIndiamine 69 72 67 55 263

Totalsilver(thousandsofounces) 1,032 1,015 1,053 1,158 4,258

Zinc(tonnes) 936 827 739 999 3,501

Copper(tonnes) 1,167 1,133 1,306 1,335 4,941

Payable metal sold:

Gold(ounces):

NorthernBusiness

LaRondemine 60,943 59,376 69,143 65,067 254,529

Lapamine 23,497 20,771 23,331 23,278 90,877

Goldexmine 27,907 27,306 33,004 27,875 116,092

Meadowbankmine 84,780 96,870 100,440 103,667 385,757

CanadianMalarticmine(ii)(iv) 59,261 67,522 72,651 71,982 271,416

Kittilamine 48,982 39,385 47,070 43,499 178,936

SouthernBusiness

PinosAltosmine 41,433 54,402 49,327 41,418 186,580


LaIndiamine 26,898 23,803 28,983 25,366 105,050



NorthernBusiness

LaRondemine 205 225 220 308 958


CanadianMalarticmine(ii)(iv) 54 80 53 98 285


SouthernBusiness

PinosAltosmine 446 616 620 607 2,289


LaIndiamine 63 76 66 56 261

Totalsilver(thousandsofounces) 888 1,106 1,037 1,153 4,184

Zinc(tonnes) 1,264 733 650 949 3,596

Copper(tonnes) 1,160 1,131 1,302 1,354 4,947


Three Months Ended

March 31,

2014 June 30,

2014 September 30,

2014 December 31,

2014 Total 2014

Operating margin (i) :

Revenuesfromminingoperations $ 491,767 $ 438,521 $ 463,388 $ 503,090 $ 1,896,766

Productioncosts 218,066 229,383 269,793 287,317 1,004,559


Operating margin (i) by mine:

NorthernBusiness

LaRondemine 45,425 26,402 14,696 33,535 120,058

Lapamine 15,340 9,050 13,748 16,060 54,198

Goldexmine 9,525 13,283 17,237 20,693 60,738

Meadowbankmine 123,961 88,728 52,504 39,839 305,032

CanadianMalarticmine(ii) – 3,668 33,224 39,092 75,984

Kittilamine 19,003 14,184 12,128 14,312 59,627

SouthernBusiness

PinosAltosmine 39,064 33,417 28,837 27,123 128,441


LaIndiamine(v) 13,669 12,978 13,189 16,727 56,563



Exploration,corporateandother 43,502 81,665 69,884 74,390 269,441

Incomebeforeincomeandminingtaxes 146,718 33,817 6,315 2,288 189,138

Incomeandminingtaxes 49,573 11,659 21,365 23,571 106,168

Netincome(loss)fortheperiod $ 97,145 $ 22,158 $ (15,050) $ (21,283) $ 82,970

Netincome(loss)pershare–basic(US$) $ 0.56 $ 0.12 $ (0.07) $ (0.10) $ 0.43

Netincome(loss)pershare–diluted(US$) $ 0.56 $ 0.12 $ (0.10) $ (0.12) $ 0.39

Cash flows:

Cashprovidedbyoperatingactivities $ 250,396 $ 182,728 $ 71,244 $ 163,956 $ 668,324

Cashusedininvestingactivities $ (108,288) $ (488,543) $ (131,662) $ (123,126) $ (851,619)

Cash(usedin)providedbyfinancingactivities $ (98,087) $ 381,951 $ (35,943) $ (18,685) $ 229,236


Realized prices (US$):

Gold(perounce) $ 1,308 $ 1,291 $ 1,249 $ 1,202 $ 1,261

Silver(perounce) $ 20.62 $ 19.45 $ 17.72 $ 15.60 $ 18.27

Zinc(pertonne) $ 2,027 $ 2,142 $ 2,365 $ 2,216 $ 2,224

Copper(pertonne) $ 6,386 $ 6,893 $ 7,500 $ 5,961 $ 6,596

Payable production (iii) :

Gold(ounces):

NorthernBusiness

LaRondemine 59,352 48,494 37,490 59,316 204,652

Lapamine 23,409 18,821 24,781 25,611 92,622

Goldexmine 19,430 23,929 27,611 29,463 100,433

Meadowbankmine 156,444 118,161 91,557 86,715 452,877

CanadianMalarticmine(ii) – 11,878 64,761 66,369 143,008

Kittilamine 38,552 31,830 28,230 43,130 141,742

SouthernBusiness

PinosAltosmine 45,217 43,978 41,155 40,669 171,019


LaIndiamine(v) 13,700 17,809 20,311 23,273 75,093



NorthernBusiness

LaRondemine 349 345 224 357 1,275


CanadianMalarticmine(ii) – 10 66 75 151


SouthernBusiness

PinosAltosmine 460 422 425 424 1,731


LaIndiamine(v) 27 40 44 67 178

Totalsilver(thousandsofounces) 880 861 820 1,003 3,564

Zinc(tonnes) 2,060 3,793 2,230 2,432 10,515

Copper(tonnes) 1,554 1,058 989 1,396 4,997


Payable metal sold:

Gold(ounces):

NorthernBusiness

LaRondemine 58,100 48,115 39,279 56,844 202,338

Lapamine 23,451 18,162 22,422 28,054 92,089

Goldexmine 19,607 22,255 26,762 31,702 100,326

Meadowbankmine 147,502 118,176 98,604 87,741 452,023

CanadianMalarticmine(ii)(iv) – 16,377 60,093 66,219 142,689

Kittilamine 37,429 31,519 28,209 42,609 139,766

SouthernBusiness

PinosAltosmine 46,810 43,058 41,143 45,457 176,468


LaIndiamine(v) 14,632 15,025 19,265 24,019 72,941



NorthernBusiness

LaRondemine 340 322 249 367 1,278


CanadianMalarticmine(ii)(iv) – 15 57 68 140


SouthernBusiness

PinosAltosmine 507 430 430 456 1,823


LaIndiamine(v) 26 34 42 67 169

Totalsilver(thousandsofounces) 917 844 829 1,043 3,633

Zinc(tonnes) 1,673 2,458 3,936 2,468 10,535

Copper(tonnes) 1,542 1,074 988 1,399 5,003

Notes:

(i) Operatingmarginiscalculatedasrevenuesfromminingoperationslessproductioncosts.

(ii) OnJune16,2014,AgnicoEagleandYamanajointlyacquired100.0%ofOsiskobywayoftheArrangement.AsaresultoftheArrangement,AgnicoEagleandYamanaeachindirectlyown50.0%ofOsisko(nowCanadianMalarticCorporation)andCanadianMalarticGP,whichnowholdstheCanadianMalarticmine.TheinformationsetoutinthistablereflectstheCompany's50.0%interestintheCanadianMalarticminesincethedateofacquisition.

(iii) Payableproduction(anon-GAAPnon-financialperformancemeasure)isthequantityofmineralproducedduringaperiodcontainedinproductsthatareorwillbesoldbytheCompany,whethersuchproductsaresoldduringtheperiodorheldasinventoriesattheendoftheperiod.

(iv) TheCanadianMalarticmine'spayablemetalsoldexcludesthe5.0%netsmelterroyaltytransferredtoOsiskoGoldRoyaltiesLtd.,pursuanttotheArrangement.

(v) TheLaIndiamineachievedcommercialproductiononFebruary1,2014.


THREE YEAR FINANCIAL AND OPERATING SUMMARY (thousands of United States dollars, except where noted)

2015 2014 2013 Revenuesfromminingoperations $ 1,985,432 $ 1,896,766 $ 1,638,406

Productioncosts 995,295 1,004,559 866,082

Operatingmargin(i) 990,137 892,207 772,324

Amortizationofproperty,plantandminedevelopment 608,609 433,628 313,890

Impairmentloss – – 1,014,688

Exploration,corporateandother 298,900 269,441 262,033

Income(loss)beforeincomeandminingtaxes 82,628 189,138 (818,287)

Incomeandminingtaxes(recovery)expense 58,045 106,168 (131,582)

Netincome(loss)fortheyear $ 24,583 $ 82,970 $ (686,705)

Netincome(loss)pershare–basic $ 0.11 $ 0.43 $ (3.97)

Netincome(loss)pershare–diluted $ 0.11 $ 0.39 $ (3.97)

Operatingcashflow $ 616,238 $ 668,324 $ 481,043

Investingcashflow $ (374,519) $ (851,619) $ (687,220)

Financingcashflow $ (280,760) $ 229,236 $ 48,729

Dividendsdeclaredpershare $ 0.32 $ 0.32 $ 0.66

Capitalexpenditures $ 449,758 $ 475,412 $ 620,536

Averagegoldpriceperouncerealized $ 1,156 $ 1,261 $ 1,366

Averageexchangerate–C$per$ C$ 1.2788 C$ 1.1047 C$ 1.0301

Weightedaveragenumberofcommonsharesoutstanding–basic(thousands) 216,168 195,223 172,893

Workingcapital(includingundrawncreditlines) $ 1,441,991 $ 1,274,627 $ 1,586,676

Totalassets $ 6,683,180 $ 6,840,538 $ 4,580,081

Long-termdebt $ 1,118,187 $ 1,374,643 $ 987,356

Shareholders'equity $ 4,141,020 $ 4,068,490 $ 2,717,406


Operating Summary

LaRondemine

Revenuesfromminingoperations $ 318,207 $ 308,794 $ 329,900

Productioncosts 172,283 188,736 228,640

Operatingmargin(i) $ 145,924 $ 120,058 $ 101,260


Grossprofit $ 65,626 $ 55,113 $ 41,805

Tonnesoforemilled 2,241,424 2,085,300 2,319,132

Gold–gramspertonne 3.91 3.24 2.63

Goldproduction–ounces 267,921 204,652 181,781

Silverproduction–thousandsofounces 916 1,275 2,102

Zincproduction–tonnes 3,501 10,515 19,814

Copperproduction–tonnes 4,941 4,997 4,835

Totalcashcostsperounceofgoldproduced($perouncebasis):

Productioncosts $ 643 $ 922 $ 1,258

Adjustments:

Inventoryandotheradjustments(ii) 117 133 175

Totalcashcostsperounceofgoldproduced–co-productbasis(iii) $ 760 $ 1,055 $ 1,433


Totalcashcostsperounceofgoldproduced–by-productbasis(iii) $ 590 $ 668 $ 767

Minesitecostspertonne(iv) C$ 99 C$ 99 C$ 99

Lapamine





Grossprofit $ 21,275 $ 28,207 $ 27,810

Tonnesoforemilled 559,926 638,800 640,422





Productioncosts $ 578 $ 659 $ 689

Adjustments:

Inventoryandotheradjustments(ii) 13 8 (11)

Totalcashcostsperounceofgoldproduced–co-productbasis(iii) $ 591 $ 667 $ 678

By-productmetalrevenues $ (1) – (1)



Goldexmine





Grossprofit $ 16,839 $ 8,186 $ (2,836)

Tonnesoforemilled 2,312,567 2,116,777 527,654



Totalcashcostsperounceofgoldproduced($perouncebasis)(v):


Adjustments:

Inventoryandotheradjustments(ii) 7 (8) 99


By-productmetalrevenues – – –


Minesitecostspertonne(iv)(v) C$ 33 C$ 33 C$ 37

Meadowbankmine





Grossprofit $ 71,403 $ 185,487 $ 142,686

Tonnesoforemilled 4,032,852 4,129,100 4,142,840



Silverproduction–thousandsofounces 221 135 100



Adjustments:

Inventoryandotheradjustments(ii) 19 6 (10)





CanadianMalarticmine(vi)

Revenuesfromminingoperations $ 333,280 $ 189,900 $ –

Productioncosts 171,473 113,916 –

Operatingmargin(i) $ 161,807 $ 75,984 $ –

Amortizationofproperty,plantandminedevelopment 103,050 40,973 –

Grossprofit $ 58,757 $ 35,011 $ –

Tonnesoforemilled 9,544,763 5,263,100 –

Gold–gramspertonne 1.05 0.95 –

Goldproduction–ounces 285,809 143,008 –

Silverproduction–thousandsofounces 300 151 –


Productioncosts $ 600 $ 797 $ –

Adjustments:

Inventoryandotheradjustments(ii) 13 (76) –

Totalcashcostsperounceofgoldproduced–co-productbasis(iii) $ 613 $ 721 $ –

By-productmetalrevenues (17) (20) –

Totalcashcostsperounceofgoldproduced–by-productbasis(iii) $ 596 $ 701 $ –

Minesitecostspertonne(iv) C$ 23 C$ 22 C$ –


Kittilamine





Grossprofit $ 31,614 $ 25,944 $ 84,192

Tonnesoforemilled 1,464,038 1,156,400 934,224




Totalcashcostsperounceofgoldproduced($perouncebasis)(vii):


Adjustments:

Inventoryandotheradjustments(ii) (1) 21 34




Minesitecostspertonne(iv)(vii) € 76 € 78 € 73

PinosAltosmine





Grossprofit $ 103,840 $ 85,484 $ 149,977

Tonnesoforeprocessed 2,378,406 2,520,400 2,725,703



Silverproduction–thousandsofounces 2,384 1,731 2,366




Adjustments:

Inventoryandotheradjustments(ii) 33 (3) 14




Minesitecostspertonne(iv) $ 45 $ 48 $ 43

CrestonMascotadepositatPinosAltos





Grossprofit $ 22,326 $ 21,940 $ 14,800

Tonnesoforeprocessed 2,098,812 1,793,800 1,276,159




Totalcashcostsperounceofgoldproduced($perouncebasis)(viii):


Adjustments:

Inventoryandotheradjustments(ii) (6) 26 26




Minesitecostspertonne(iv)(viii) $ 12 $ 16 $ 16


LaIndiamine(ix)

Revenuesfromminingoperations $ 124,679 $ 93,512 $ –

Productioncosts 49,578 36,949 –

Operatingmargin(i) $ 75,101 $ 56,563 $ –

Amortizationofproperty,plantandminedevelopment 81,430 43,356 –

Grossprofit $ (6,329) $ 13,207 $ –

Tonnesoforeprocessed 5,371,419 4,773,190 –

Gold–gramspertonne 0.95 0.98 –

Goldproduction–ounces 104,362 75,093 –

Silverproduction–thousandsofounces 263 178 –

Totalcashcostsperounceofgoldproduced($perouncebasis)(ix):

Productioncosts $ 475 $ 516 $ –

Adjustments:

Inventoryandotheradjustments(ii) – 16 –

Totalcashcostsperounceofgoldproduced–co-productbasis(iii) $ 475 $ 532 $ –

By-productmetalrevenues (39) (45) –

Totalcashcostsperounceofgoldproduced–by-productbasis(iii) $ 436 $ 487 $ –

Minesitecostspertonne(iv) $ 9 $ 8 $ –

Notes:

(i) Operatingmarginiscalculatedasrevenuesfromminingoperationslessproductioncosts.(ii) UndertheCompany'srevenuerecognitionpolicy,revenueisrecognizedonconcentrateswhenlegaltitlepasses.Astotalcashcostsperounceofgoldproducedare

calculatedonaproductionbasis,thisinventoryadjustmentreflectsthesalesmarginontheportionofconcentrateproductionnotyetrecognizedasrevenue.Otheradjustmentsincludetheadditionofsmelting,refiningandmarketingchargestoproductioncosts.

(iii) TotalcashcostsperounceofgoldproducedisnotarecognizedmeasureunderIFRSandthisdatamaynotbecomparabletodatapresentedbyothergoldproducers.Totalcashcostsperounceofgoldproducedispresentedonbothaby-productbasis(deductingby-productmetalrevenuesfromproductioncosts)andco-productbasis(beforeby-productmetalrevenues).Totalcashcostsperounceofgoldproducedonaby-productbasisiscalculatedbyadjustingproductioncostsasrecordedintheconsolidatedstatementsofincomeandcomprehensiveincomeforby-productmetalrevenues,unsoldconcentrateinventoryproductioncosts,smelting,refiningandmarketingchargesandotheradjustments,andthendividingbythenumberofouncesofgoldproduced.Totalcashcostsperounceofgoldproducedonaco-productbasisiscalculatedinthesamemannerastotalcashcostsperounceofgoldproducedonaby-productbasisexceptthatnoadjustmentforby-productmetalrevenuesismade.Thecalculationoftotalcashcostsperounceofgoldproducedonaco-productbasisdoesnotreflectareductioninproductioncostsorsmelting,refiningandmarketingchargesassociatedwiththeproductionandsaleofby-productmetals.TheCompanybelievesthatthesegenerallyacceptedindustrymeasuresprovidearealisticindicationofoperatingperformanceandprovideusefulcomparisonpointsbetweenperiods.TotalcashcostsperounceofgoldproducedisintendedtoprovideinformationaboutthecashgeneratingcapabilitiesoftheCompany'sminingoperations.ManagementalsousesthesemeasurestomonitortheperformanceoftheCompany'sminingoperations.Asmarketpricesforgoldarequotedonaperouncebasis,usingthetotalcashcostsperounceofgoldproducedonaby-productbasismeasureallowsmanagementtoassessamine'scashgeneratingcapabilitiesatvariousgoldprices.Managementisawarethattheseperouncemeasuresofperformancecanbeaffectedbyfluctuationsinexchangeratesand,inthecaseoftotalcashcostsofgoldproducedonaby-productbasis,by-productmetalprices.Managementcompensatesfortheseinherentlimitationsbyusingthesemeasuresinconjunctionwithminesitecostspertonne(discussedbelow)aswellasotherdatapreparedinaccordancewithIFRS.Managementalsoperformssensitivityanalysesinordertoquantifytheeffectsoffluctuatingmetalpricesandexchangerates

(iv) MinesitecostspertonneisnotarecognizedmeasureunderIFRSandthisdatamaynotbecomparabletodatapresentedbyothergoldproducers.Thismeasureiscalculatedbyadjustingproductioncostsasshownintheconsolidatedstatementsofincomeandcomprehensiveincomeforunsoldconcentrateinventoryproductioncosts,andthendividingbytonnesoforemilled.Asthetotalcashcostsperounceofgoldproducedmeasurecanbeimpactedbyfluctuationsinby-productmetalpricesandexchangerates,managementbelievesthattheminesitecostspertonnemeasureprovidesadditionalinformationregardingtheperformanceofminingoperations,eliminatingtheimpactofvaryingproductionlevels.Managementalsousesthismeasuretodeterminetheeconomicviabilityofminingblocks.Aseachminingblockisevaluatedbasedonthenetrealizablevalueofeachtonnemined,inordertobeeconomicallyviabletheestimatedrevenueonapertonnebasismustbeinexcessoftheminesitecostspertonne.ManagementisawarethatthispertonnemeasureofperformancecanbeimpactedbyfluctuationsinprocessinglevelsandcompensatesforthisinherentlimitationbyusingthismeasureinconjunctionwithproductioncostspreparedinaccordancewithIFRS.


(v) TheGoldexmine'sMandEZonesachievedcommercialproductiononOctober1,2013.ExcludestheGoldexmine'sresultsforthethirdquarterof2013.Initialnon-commercialpayablegoldproductionof1,505ounceswasachievedattheGoldexmine'sMandEZonesduringthethirdquarterof2013.

(vi) OnJune16,2014,AgnicoEagleandYamanajointlyacquired100%ofOsiskobywayoftheArrangement.AsaresultoftheArrangement,AgnicoEagleandYamanaeachindirectlyown50.0%ofOsisko(nowCanadianMalarticCorporation)andCanadianMalarticGP,whichnowholdstheCanadianMalarticmine.TheinformationsetoutinthistablereflectstheCompany's50.0%interestintheCanadianMalarticminesincethedateofacquisition.

(vii) ThecalculationsoftotalcashcostsperounceofgoldproducedandminesitecostspertonneexcludetheKittilamine'sresultsforthesecondquarterof2013.Duetoanextendedmaintenanceshutdown,theKittilamineonlyoperatedfor14daysduringthesecondquarterof2013.TheKittilamineincurred$18,159inproductioncostsduringthesecondquarterof2013,whichwereremovedfromthecalculationoftotalcashcostsperounceofgoldproducedandminesitecostspertonne.

(viii) ThecalculationsoftotalcashcostsperounceofgoldproducedandminesitecostspertonneexcludetheCrestonMascotadepositatPinosAltos'resultsforthefirstquarterof2013duetothetemporarysuspensionofactiveleachingbetweenOctober1,2012andMarch13,2013.TheCrestonMascotadepositatPinosAltosincurred$3,117inproductioncostsduringthefirstquarterof2013,whichwereremovedfromthecalculationoftotalcashcostsperounceofgoldproducedandminesitecostspertonne.

(ix) TheLaIndiamineachievedcommercialproductiononFebruary1,2014.ThecalculationoftotalcashcostsperounceofgoldproducedfortheyearendedDecember31,2014excludes3,492ouncesofpayablegoldproductionastheywereproducedpriortotheachievementofcommercialproduction.


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Exhibit99.3

AGNICOEAGLEMINESLIMITEDMANAGEMENT'SDISCUSSIONANDANALYSISNOTETOINVESTORSCONCERNINGFORWARD-LOOKINGINFORMATIONNOTETOINVESTORSCONCERNINGESTIMATESOFMINERALRESOURCES

CautionaryNotetoInvestorsConcerningEstimatesofMeasuredandIndicatedMineralResourcesCautionaryNotetoInvestorsConcerningEstimatesofInferredMineralResources

NOTETOINVESTORSCONCERNINGCERTAINMEASURESOFPERFORMANCEGoldPrices($perounce)TotalProductionCostsbyCategorySUMMARIZEDQUARTERLYDATA(thousandsofUnitedStatesdollars,exceptwherenoted)THREEYEARFINANCIALANDOPERATINGSUMMARY(thousandsofUnitedStatesdollars,exceptwherenoted)

Exhibit 99.4

Rule 13a-14(a) or Rule 15d-14(a) Certification - CEO I, Sean Boyd, certify that: 1. I have reviewed this annual report on Form 40-F of Agnico Eagle Mines Limited; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the

statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the

financial condition, results of operations and cash flows of the issuer as of, and for, the periods presented in this report; 4. The issuer’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act

Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the issuer andhave:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to

ensure that material information relating to the issuer, including its consolidated subsidiaries, is made known to us by others within those entities,particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our

supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the issuer’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness

of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the issuer’s internal control over financial reporting that occurred during the period covered by the annualreport that has materially affected, or is reasonably likely to materially affect, the issuer’s internal control over financial reporting; and

5. The issuer’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the issuer’s

auditors and the audit committee of the issuer’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonablylikely to adversely affect the issuer’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the issuer’s internal control

over financial reporting.

Toronto, Canada

March 23, 2016 /s/ Sean BoydSean BoydVice-Chairman and Chief Executive Officer

Exhibit 99.5

Rule 13a-14(a) or Rule 15d-14(a) Certification - CFO I, David Smith, certify that: 1. I have reviewed this annual report on Form 40-F of Agnico Eagle Mines Limited; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the

statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the

financial condition, results of operations and cash flows of the issuer as of, and for, the periods presented in this report; 4. The issuer’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act

Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the issuer andhave:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to

ensure that material information relating to the issuer, including its consolidated subsidiaries, is made known to us by others within those entities,particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our

supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the issuer’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness

of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the issuer’s internal control over financial reporting that occurred during the period covered by the annualreport that has materially affected, or is reasonably likely to materially affect, the issuer’s internal control over financial reporting; and

5. The issuer’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the issuer’s

auditors and the audit committee of the issuer’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonablylikely to adversely affect the issuer’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the issuer’s internal control

over financial reporting.

Toronto, Canada

March 23, 2016

/s/ David SmithDavid SmithSenior Vice-President, Finance and Chief Financial Officer

Exhibit 99.6

Rule 13a-14(b) Certification CEO In connection with the annual report of Agnico Eagle Mines Limited (the “Company”) on Form 40-F for the fiscal year ended December 31, 2015 as filed with theSecurities and Exchange Commission on the date hereof (the “Report”), I, Sean Boyd, the Vice-Chairman and Chief Executive Officer of the Company, certify,pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that: 1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. Toronto, Canada

March 23, 2016

/s/ Sean BoydSean BoydVice-Chairman and Chief Executive Officer

Exhibit 99.7

Rule 13a-14(b) Certification CFO In connection with the annual report of Agnico Eagle Mines Limited (the “Company”) on Form 40-F for the fiscal year ended December 31, 2015 as filed with theSecurities and Exchange Commission on the date hereof (the “Report”), I, David Smith, the Senior Vice-President, Finance and Chief Financial Officer of theCompany, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that: 1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. Toronto, Canada

March 23, 2016

/s/ David SmithDavid SmithSenior Vice-President, Finance and Chief Financial Officer

Exhibit 99.8

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM We consent to the reference to our Firm under the caption “Interests of Experts” and to the inclusion in the Annual Report on Form 40-F of Agnico Eagle MinesLimited for the year ended December 31, 2015 filed with the Securities and Exchange Commission on March 24, 2016 (the “Annual Report”), and theincorporation by reference in the Registration Statements on Form F-10 (registration no. 333-206498), Form F-3D (registration no. 333-190888) and Form S-8(registration nos. 333-130339 and 333-152004) of our reports dated March 23, 2016, with respect to the consolidated financial statements of Agnico Eagle MinesLimited as of December 31, 2015 and December 31, 2014 and for each of the years in the two-year period ended December 31, 2015 and with respect to theeffectiveness of internal control over financial reporting of Agnico Eagle Mines Limited, which reports are included in the Annual Report. Toronto, Canada

March 23, 2016

/s/ ERNST & YOUNG LLPERNST & YOUNG LLPChartered Professional Accountants,Licensed Public Accountants

Exhibit 99.9

CONSENT OF DANIEL DOUCET I consent to the inclusion in the Annual Report on Form 40-F of Agnico Eagle Mines Limited for the year ended December 31, 2015 filed with the Securities andExchange Commission on March 24, 2016 (the “Annual Report”) of my name and the information that I have approved of as a “qualified person” under theCanadian Securities Administrators National Instrument 43-101 in the Annual Information Form of Agnico Eagle Mines Limited dated March 15, 2016 (the “AIF”)filed as part of the Annual Report. I also consent to the incorporation by reference in the Registration Statements on Form F-10 (registration no. 333-206498), Form F-3D (registration no. 333-190888) and Form S-8 (registration nos. 333-130339 and 333-152004) of the reference to my name and the above-mentioned information in the AIF.

March 23, 2016

/s/ Daniel DoucetDaniel DoucetSenior Corporate Director, Reserve Development

Exhibit 99.10

CONSENT OF DONALD GERVAIS I consent to the inclusion in the Annual Report on Form 40-F of Agnico Eagle Mines Limited for the year ended December 31, 2015 filed with the Securities andExchange Commission on March 24, 2016 (the “Annual Report”) of my name and the information that I have approved of as a “qualified person” under theCanadian Securities Administrators National Instrument 43-101 in the Annual Information Form of Agnico Eagle Mines Limited dated March 15, 2016 (the “AIF”)filed as part of the Annual Report. I also consent to the incorporation by reference in the Registration Statements on Form F-10 (registration no. 333-206498), Form F-3D (registration no. 333-190888) and Form S-8 (registration nos. 333-130339 and 333-152004) of the reference to my name and the above-mentioned information in the AIF. March 23, 2016

/s/ Donald GervaisDonald GervaisDirector of Technical Services at Canadian Malartic Corporation

Exhibit 99.11

CONSENT OF LOUISE GRONDIN I consent to the inclusion in the Annual Report on Form 40-F of Agnico Eagle Mines Limited for the year ended December 31, 2015 filed with the Securities andExchange Commission on March 24, 2016 (the “Annual Report”) of my name and the information that I ave approved of as a “qualified person” under theCanadian Securities Administrators National Instrument 43-101 in the Annual Information Form of Agnico Eagle Mines Limited dated March 15, 2016 (the “AIF”)filed as part of the Annual Report. I also consent to the incorporation by reference in the Registration Statements on Form F-10 (registration no. 333-206498), Form F-3D (registration no. 333-190888) and Form S-8 (registration nos. 333-130339 and 333-152004) of the reference to my name and the above-mentioned information in the AIF. March 23, 2016

/s/ Louise GrondinLouise GrondinSenior Vice-President, Environment, Sustainable Development and People

Exhibit 99.12

CONSENT OF TIM HALDANE I consent to the inclusion in the Annual Report on Form 40-F of Agnico Eagle Mines Limited for the year ended December 31, 2015 filed with the Securities andExchange Commission on March 24, 2016 (the “Annual Report”) of my name and the information that I have approved of as a “qualified person” under theCanadian Securities Administrators National Instrument 43-101 in the Annual Information Form of Agnico Eagle Mines Limited dated March 15, 2016 (the “AIF”)filed as part of the Annual Report. I also consent to the incorporation by reference in the Registration Statements on Form F-10 (registration no. 333-206498), Form F-3D (registration no. 333-190888) and Form S-8 (registration nos. 333-130339 and 333-152004) of the reference to my name and the above-mentioned information in the AIF. March 23, 2016

/s/ Tim HaldaneTim HaldaneSenior Vice-President, Operations - USA & Latin America

Exhibit 99.13

CONSENT OF PAUL COUSIN I consent to the inclusion in the Annual Report on Form 40-F of Agnico Eagle Mines Limited for the year ended December 31, 2015 filed with the Securities andExchange Commission on March 24, 2016 (the “Annual Report”) of my name and the information that I have approved of as a “qualified person” under theCanadian Securities Administrators National Instrument 43-101 in the Annual Information Form of Agnico Eagle Mines Limited dated March 15, 2016 (the “AIF”)filed as part of the Annual Report. I also consent to the incorporation by reference in the Registration Statements on Form F-10 (registration no. 333-206498), Form F-3D (registration no. 333-190888) and Form S-8 (registration nos. 333-130339 and 333-152004) of the reference to my name and the above-mentioned information in the AIF. March 23, 2016

/s/ Paul CousinPaul CousinVice-President, Metallurgy

Exhibit 99.14

CONSENT OF FRANCIS BRUNET I consent to the inclusion in the Annual Report on Form 40-F of Agnico Eagle Mines Limited for the year ended December 31, 2015 filed with the Securities andExchange Commission on March 24, 2016 (the “Annual Report”) of my name and the information that I have approved of as a “qualified person” under theCanadian Securities Administrators National Instrument 43-101 in the Annual Information Form of Agnico Eagle Mines Limited dated March 15, 2016 (the “AIF”)filed as part of the Annual Report. I also consent to the incorporation by reference in the Registration Statements on Form F-10 (registration no. 333-206498), Form F-3D (registration no. 333-190888) and Form S-8 (registration nos. 333-130339 and 333-152004) of the reference to my name and the above-mentioned information in the AIF. March 23, 2016

/s/ Francis BrunetFrancis BrunetCorporate Director Mining

Exhibit 99.15

CONSENT OF DOMINIQUE GIRARD I consent to the inclusion in the Annual Report on Form 40-F of Agnico Eagle Mines Limited for the year ended December 31, 2015 filed with the Securities andExchange Commission on March 24, 2016 (the “Annual Report”) of my name and the information that I have approved of as a “qualified person” under theCanadian Securities Administrators National Instrument 43-101 in the Annual Information Form of Agnico Eagle Mines Limited dated March 15, 2016 (the “AIF”)filed as part of the Annual Report. I also consent to the incorporation by reference in the Registration Statements on Form F-10 (registration no. 333-206498), Form F-3D (registration no. 333-190888) and Form S-8 (registration nos. 333-130339 and 333-152004) of the reference to my name and the above-mentioned information in the AIF. March 23, 2016

/s/ Dominique GirardDominique GirardVice-President Technical Services and Nunavut Operations

Exhibit 99.16

CONSENT OF CHRISTIAN PROVENCHER I consent to the inclusion in the Annual Report on Form 40-F of Agnico Eagle Mines Limited for the year ended December 31, 2015 filed with the Securities andExchange Commission on March 24, 2016 (the “Annual Report”) of my name and the information that I have approved of as a “qualified person” under theCanadian Securities Administrators National Instrument 43-101 in the Annual Information Form of Agnico Eagle Mines Limited dated March 15, 2016 (the “AIF”)filed as part of the Annual Report. I also consent to the incorporation by reference in the Registration Statements on Form F-10 (registration no. 333-206498), Form F-3D (registration no. 333-190888) and Form S-8 (registration nos. 333-130339 and 333-152004) of the reference to my name and the above-mentioned information in the AIF. March 23, 2016

/s/ Christian ProvencherChristian ProvencherVice-President, Canada