Good morning, ladies and gentlemen, welcome to the Agnico-Eagle first quarter 2010 results webcast conference call. At this time, all participants are in a listen-only mode. Following the presentation there will be a question-and-answer session with instructions provided. (Operator Instructions) I would like to remind everyone that this conference is being recorded today Friday, April 30th, 2010 at 8:30 Eastern Time. And I would now like to turn the conference over to Mr. Sean Boyd, Chief Executive Officer. Please go ahead, sir.

Thank you, operator, and good morning, everyone. And welcome to our 2010 first quarter conference call. We've got our entire team here with us in Toronto. Our annual meeting this morning is at 11:00. So with the full team, once we finish the formal part of the presentation, we’ll be happy to answer your questions. In terms of highlights for the quarter, it was a big quarter for us from the perspective of bringing Meadowbank into the production. We achieved commercial production at Meadowbank. The mine continues to run well in April. We’ll talk about that in a little bit more detail. At Kittila, we’ll also give you some updates on Kittila. Our recoveries slipped a bit. We are continuing to do test work with the concentrate looking to improve the stability of the reaction in the autoclave through additives in the concentrate. But we’ll give you some more detail on that, and particularly in the question-and-answer session. And as you saw from our release, we’re still anticipating getting up to see the feasibility level recoveries as we move towards the end 2010. But we’re going to move through the slide presentation. And we’re going to move through it as quickly as we can so that we can get to questions. In terms of the strategy, nothing really changes for Agnico. We continue to move forward in an optimization and expansion phase on the existing asset base that we've built over the last several years. We’re still targeting production in the million to 1.1 million-ounce range for 2010. We continue to work, as we said, on optimization of the assets we've built. But we also continue to study internal expansion opportunities. And we’ll touch on a few of those as we move on through the presentation. Our reserves are at…

Thank you. Ladies and gentlemen, we will now conduct the question-and-answer session. (Operator Instructions) Your first question comes from Anita Soni of Credit Suisse. Please go ahead.

Just a question with respect to the grade at Kittila and the grade at Lapa as well. Let's start with Lapa, it's – the grade was a little bit higher than the guidance that you provided in December. Is that expected to continue? Or is it expected to come down to the gram per ton level.

The question, we just have a little bit of trouble hearing that, Anita. The question is on Lapa. And the grade was higher than our guidance, and you just want to know why that was.

Not really why, but whether or not it's expected to continue.

We were in a bit of high grade cycle. So it basically is according to plan. And we are having slightly lower grades this – in this particular month. But once again, that's according to plan. And the other reason was we had slightly lower dilution during this quarter because we had the thicker stokes. So it was a function of that as well.

So overall, for the average for the year, you're still expecting to come in at around 8 grams per ton then?

8.9 grams.

8.9 grams.

Yes.

And then, a similar question with Kittila, although it wasn't as pronounced. It was just slightly lower right there.

At Kittila, actually, the grades that we are expecting out of the pit are slightly higher. That's why we expect to make our forecast or our guidance the average grade out of the pit reconciled with the mill is currently running anywhere between 2% to 3% higher. So we expect our grade to be – average out about 5.2 grams to the 5.4 grams per ton range.

Okay. And then lastly, just the grade – the base metal – the by-product grades at LaRonde, they were a little bit lower than we were – than even you were forecasting previously. Is that expected to come up or to – will you still be in the lower grade area?

I would think we'd be very close to guidance. That's also a function of metal prices compared to when we did the budget. So we'd be able to mine slightly lower grade material. And that offsets some of the original plans. So we're basically maximizing the LaRonde ore body. And it'll be judged almost on a month-by-month basis, what becomes economic.

Okay. Thank you very much.

Your next question comes from Ahod Paul of Canaccord Adams. Please go ahead. Mr. Paul, if you're on speakerphone, would you mind picking up the handset? I’m sorry. We cannot hear you. Perhaps your line's on mute. You’re next question comes from John Tumazos of John Tumazos Very Independent Research. Please go ahead.

Congratulations on the improvements. Could you explain how you chose $600 million as the amount for the bond offering? Clearly, with the size mines built, a lot of cash is going to come in, though you’re looking at more expansions, possibly more acquisition after Comaplex et cetera. Second, will the acquisitions be limited to the same three countries and the various districts where you're currently operating or would you entertain new areas, Nevada, other places in Latin America, other parts of Canada?

John, on the debt issuance, what we were looking to do is essentially term out some of our shorter terms bank lines and take advantage of historically low interest rates in very tight credits spread. We didn't want to do an overly large financing. We targeted about 5% of the market cap, but the demand was very, very strong. So we sized up the deal marginally to $600 million. And our objective is always the drive down our cost of capital. And we think ten-year money at 6.6% is very prudent financing. We think over that ten-year tenure, it'll prove to be a very low cost of capital for our business. You’re right. We will be generating significant net free cash flow. Our objective is to maintain, on an ongoing basis, a net debt of essentially nil. So we will carry cash on our balance sheet that we think ultimately will probably generate a higher interest rate than will be (inaudible) with a tenure of ten years.

And then the second part of that, John, as far as political risk profile and where were looking in terms of geographies, currently the focus is on the three countries that we currently operate in. And as you can see, with the agreement in principle in Comaplex, we looked at that one not only because we like the potential deposit, but it’s in an area where we feel comfortable operating in. So what we see going forward is, with the internal expansions, we have steady growth out through 2014. We can manage that very handedly with the cash that we're going to be generating from the mines, something like a Comaplex, assuming that goes forward. We've come in beyond that 2014 period, which would drive reserves and production growth beyond that. So we feel comfortable with that position, so we're not in a rush to look elsewhere. But we’re in the mining business, so we will look. But the way we’re trying to grow is without really having a major increase in our political risk profile.

If I can ask one more, what was the current interest rate on the bank loans that you just repaid?

LIBOR plus 3.5%, but we haven’t permanently reduced those bank lines. They still remain fully available to us. And in fact, we're looking at actually expanding them and expanding them out further just to have that much more available liquidity to us.

The LIBOR plus 3.5% would be between 4% and 4.5% today.

Yes.

So you termed it out by paying 2.5% more interest.

That’s right, so with that ten-year money. And we think it’s very cost effective for this. By next year, we're paying cash taxes in Canada, so that will help shelter some of the income we generate in Canada as well. So on an after tax basis, it's a very cost effective capital.

Thank you.

Your next question comes from David Haughton of BMO Capital Markets, please go ahead.

Good morning, and thank you for the presentation. Just having a look on your CapEx slide, on the presentation it was number 12. I was just wondering where some of these development projects might fit on this. And I guess, one of the things that I'm looking at is you've already started on the Creston Mascota. Previous guidance had said that it would be about $60 million in CapEx. I'm just wondering if – based on your early experience if that’s still a valid number to use.

That is still a valid number, David. And as far as the other projects are concerned, we’re looking at spreading them out across into 2014, a Meadowbank expansion to 10,000 tons. We would see that perhaps coming in around 2012, 2013, similarly, with the Pinos Altos. But these expansions are – I wouldn't consider them major. They're all in the – about maybe $65 million to $100 plus million range gold excess essentially complete. We can go to 85,000 tons per day depending on the mining plan. And as Sean mentioned, we're about a year-and-a half ahead of schedule on that to be able to supply additional ore from underground. And then, we also have things like El Sinter, another roughly about $60 million project similar to Mascota. The biggest one we would have would Kittila. But once again, that’s an underground development project along with expansion in the mill. So we would be able to see that starting in the later years and spread out over a couple of years. In our strategic plan, we do not want to go through – like the last three years and have a massive spending spree and construction spree as well. We wanted this to be more orderly.

Thanks, Ebe, for that very thorough answer because I had anticipated with (inaudible) was leading. So thank you very much.

You next question comes from Barry Cooper of CIBC. Please go ahead.

Yes, good day. Ebe, while you're on line there, I'm just wondering – and I realize this is going to be a tough question to answer, but maybe you have some scope that you can direct us to. The reversal of the recovery rate for Kittila, how much do you think would that have been related, let's say, a hiccup that you discovered during the quarter versus the stop-start from the shutdown, and everything like that because I'm assuming there’s a bit of both of those components in that reversal.

Well, I think, I'll start with the question, and then I will refer it to Jean in more detail. Obviously, the issues that we went through during the first year, all the stop and start are not exactly conducive to autoclave wear-and-tear. So we experienced more wear-and-tear. And I think that's the key point. It is wear-and-tear and it's not in a design deficiency. So when we went in, we were able to just re-brick it. And as far as all our experts and consultants have said to us, this is part for the course, that it's not unusual wear-and-tear, and it’s part of the research and development of finding the optimal brick type and mortar type for our ore and reaction conditions. Also, we went on and did more test work using the advice from some other consultants. And some of those results were not favorable. In other words, they did not work as planned. And with that, I can turn you over to Jean Robitaille. He can give you more flavor exactly what we did and what the ultimate result was, and where we are today.

Good morning, Barry. Just a bit of history last year the same quarter, were at 28% recovery. So we're able to raise gradually to achieve in the fourth quarter 76%, and in December it was 78.6%. We're still targeting the 83%, and eventually being above it. And we have decided to change the pattern in the autoclave. And essentially, it was the first quarter, we have some good results, but also we have more downside. And it’s part of the experimentation. What we forecast, we’ll extend that. But by year-end, we're still targeting the 83%. As Ebe mentioned, the grade is a bit higher. So in terms of the gold production, we don’t see issue out there and in the future. If you look at the life of the mine of Kittila, a couple of months more will not be a disaster. We want to make sure that we'll have a stable process and have stable operation. For the autoclave itself, it's normal maintenance. The fact is that we did the inspection, and we find that wearing. We just repair, and we'll come to that on preventive maintenance according to what we have to do.

Okay. Good enough, then. So is there something specific that you think you've mastered in terms of making the improvements that you've done? And how has it reacted since the restart on (inaudible)?

It's hard to answer, Barry. You can see what we did last year. We surprised people that we're able to raise from the lower recovery to that 78%. Presently, we are working under confidential agreement with another company. And this is the reason that I cannot give more detail.

Right. Okay. And then, I'm just wondering, Dave, if you could tell us quite a bit of packs stayed or at least booked on the income statement. What numbers are we looking for the year? And why was it so high in Q1?

Well, the reason it was so high is we had a foreign currency translation loss. If you took that out, effectively, we were around above 35%, which is where we expected to be in the foreign currency translation losses. In the accounting section, it's not a deductible expense at all. So 35% long term is where I would stick. And that takes into consideration the increase in mining duties with the – that was recently announced in the first quarter.

Right. Okay. Good enough, and thanks a lot.

Your next question comes from Greg Barnes of TD Newcrest. Please go ahead.

Yes. I'm just wondering, the changes that you made to the autoclave or the concentrator, whatever you did that – that didn't work. What were they?

Sorry, can you repeat the question?

Sure. The changes that you made for the concentrator or the autoclave parameters at Kittila that did not work, what were they?

Essentially, as I mentioned to Barry previously, we work under a confidentiality agreement. But in a sense, we had a new additive to try to stabilize the reaction. And during that process, presently, we did not achieve at this time the expected (inaudible). And during the experimentation, we have some data to – it was in fact the entire amount when we dropped the recovery during the test work. And this is the result that you are seeing presently.

Okay. So you have – (inaudible) figure putting in there?

We'll extend the experimentation. This quarter, we expect being in the mid-75%, mid-70%, and going up to the 83% by year-end.

Okay. Are you going to put out a new recovery curve like you did last year or–?

I did not really have the intention.

Okay. It will be nice to see.

Your next question comes from Ahod Paul [ph] of Canaccord Adams. Please go ahead.

Guys, can you hear me or we'll try this again?

Yes.

(inaudible) Sorry. Technology, the wonders of technology. Pinos Altos, guys, despite the bottleneck of the tailings filtration circuit, you were able to get to 4,000 tons per day in the first three weeks of April. What explains that?

Okay. I'll pass that over to Tim Haldane, our Senior VP in Latin America. Tim?

Yes. We've been working pretty hard on the filters, obviously, and lots of mechanical upgrades to the filters, hydraulics, structure. And at the same time, on the process side, we've been adjusting the detox chemistry and the core smiths [ph] of the grind, and those kinds of things. So it's just a combination of a lot of changes. And typically, with tailings filtration that takes a long time to get the benefits to start showing. And that's where we are.

Okay. Sounds good, Tim. Guys, on Lapa, recovery's grades were excellent, which was great. Recovery's still not quite where you want it to be, I think, for the full year plan, 86%. You're at 77% or so. What explains that? And how do you plan to get recoveries higher at Lapa? Thank you.

Okay. For Lapa, presently, we have a gravity circuit at the front of the circuit. And after a complete analysis, we – it was – it showed that we have to move at the side mill circuit instead of the volume circuit. It's ongoing. And we expect to reach the 80% when it will be completed by the end of Q2. Beginning of Q3, it will be in position. We're still doing the investigation. And we expect to be – by year-end, to be above the 80% and near the 85% currently based on the information that we have.

Okay. Thanks, all. Thank you.

(Operator Instructions) Your next question is a follow-up from Anita Soni of Credit Suisse. Please go ahead.

Thanks. It's already been asked and answered. Thank you.

And your next question comes from Don MacLean of Paradigm Capital. Please go ahead.

Well, good morning, guys. Some good progress on a number of the mines, and good to see Meadowbank startup. Just a question, Ebe, on where you might expect some further cost savings on Meadowbank. If you take the $840 for the month, dollars per ounce, and you adjust for the fact that the production was about 25% less than design, and the recovery was about 8% or 9% less than design, that bring you down to – assuming all your costs were fixed, which probably are at this point, down to about $580. So I think the guidance for the year is about $460. So can you give us a sense of where you might see other than just the economies of scale in the recovery where you expect to see some further cost savings?

Well, one thing, Don, is that this is a one month out of the (inaudible). And it is also a month of startup. And what we did have is that our production drills had issues in the open pit due to Arctic winter conditions. So our availability was very low. So we add additional contract costs in there. And similarly, with our truck fleet, however, what we did do is put the priority on getting the process plant built, like the support facilities such as the shop facilities are currently in the process of being completed and will be ready during the month of May. So as a result, those numbers that you presently see include operating inefficiencies due to some of the maintenance issues and startup issues. And we expect to have those resolved very shortly. So therefore, we expect to have our numbered crop. With respect to recoveries, in April, already we have shipped – the design recoveries are significantly higher. And so, as it – as you know, for the first month, they had 85% already on a brand new plant. We feel that's a figure that we are satisfied with. And as I mentioned, we've already hit the design recoveries in April.

I guess that's a – it was long-winded question and they answered you're comfortable with the $460 guidance.

Yes, we are.

That's great. And good luck as you carry through. At least you're moving into an easier part of the year, couldn't have picked a harder time to startup. Well done.

Your next question comes from David Dean of Cormark Securities. Please go ahead.

Thanks for taking the question. Do you have everything that you need from your diligence process to make a decision on moving forward or not with (inaudible) flecks on Monday?

Well as we said at the start, the – there was an extension announced to Monday, May the 3rd. And both parties are working towards Monday, May the 3rd.

Okay. Does that mean though that – where they'll receive the assay results from the twinning and drilling, and you have everything that you need to make this decision?

No, all that means is that both parties are working towards May the 3rd.

Okay. Thanks.

And your next question comes from Tanya Jakusconek of National Bank Financial. Please go ahead.

Great. Thanks. I just have a question on Kittila, just on the recoveries again. I just wanted to talk a little bit about the tests that you're doing. And I appreciate that you're under the confidentiality. But can you just tell us at least if you're happy with the retention time and the autoclave? Has that resolved? Has the pH been resolved? Is the temperature, that 190 to 210, is that the temperature you're happy with that is right now it's just these additives that you're adding, just a little bit on exactly what you're doing?

Good morning, Tanya. The new product we are adding or the change is to – essentially a smoother reaction and redo the impact of retention time. So we haven't found the proper window this time. And all of the different parameters are linked with that. Yes, the autoclave is still too big. It's good for the future expansion at 4,500 tons per day. Now, we are struggling a little bit. And as I mentioned earlier, then for the life of mine, we don't see any problems. But we will have a little bit more difficulty this year. Year-end, we're still targeting 83%.

But just on the retention time. From what were we operating at retention when we were at that 76%? And I know that it is over 80%. What was that retention time?

Presently, the retention time was near the 80 minutes instead of the 45 minutes, 60 minutes. It's a function of the flow. But at that time, it was near 75 to 80 minutes.

Okay. So you still think you have to play around with that?

We would like to go more into 45 to 60 minutes.

Okay. And then, the pH and the temperature, those have to play around, too?

We keep that in the ballpark of last year in terms acid concentration and temperature.

Okay. So you're happy with that as in last year.

Yes.

So it's really just retention time, and then these additives that you're dealing with.

At this time, yes.

Yes. Okay. Thank you.

And your next question is a follow-up of Anita Soni of Credit Suisse. Please go ahead.

Can you just elaborate a little bit? I know you said they were not fatal flaws. But can you talk about some of the issues that you've been having with the crushing system at Meadowbank?

Good morning, again. All we had was installation issues at the Meadowbank. There's a backing material when we installed the liners. And that material was supposed to be kept warm, while inadvertently during the shipping from Baker Lake to Meadowbank, it froze. So we had an improper installation and we had to reinstall. Then the second thing that we noted was that the type of liners that were – had been originally ordered. And these had been ordered a couple of years ago. We're not the best liners for the jiratory [ph] crusher. So as a result of that, they had premature failure. So then, we installed a third set of liners and made some adjustments with the backing material, and also how the ore was dumped into the crusher. And we haven't had any significant issues since. So they're largely resolved.

And then, with respect to the additional operator – sorry, additional contractor costs supplementing your production drills. Is that something you expect to continue on in the future, in the winter months in order to–?

No, we don't part of the issues that we have are with the cooling system of the drills. And the suppliers realize that there is a design flaw, and is working on resolution. So we expect to have that resolved. And like all of our mines, our objective is to minimize the contractor presence.

Okay. Thank you very much.

Your next question is a follow-up from Don MacLean of Paradigm Capital. Please go ahead.

I just forgot to ask you all about the greater wear-and-tear on the autoclave. How many days of maintenance do you think you all require now going forward on an ongoing basis for maintenance with the process plant versus your original expectations?

The original expectation was to stop one year doing a complete (inaudible). Otherwise, the security will stop two times per year. But this will not impact the annual production that we have worked at. And we have a filtration system. And we will be able to filter a part of the production. And after that, we're introducing the autoclave.

Right. So you can make it up. Then that's the – you've got a lot of extra capacity in the autoclave. Is that part of the answer?

It's part of the answer. For sure, we'll have to find the proper window. But we will stay on the plant. And if you looked at the big picture in the company, now we have six mines. And if we are struggling a little bit at Kittila, we have to look also at the other parts. So if you see Goldex at 92%, when we started the same quarter last year, we're at 84%. If you look already, as Ebe mentioned, the Meadowbank, we're touching the 94%, 95% the last couple of days. So in general, the big picture is we are going on a good track.

Great. Thanks you all.

Mr. Boyd, there are no further questions at this time. Please continue.

Thanks, operator. And thanks, everyone, for your attention this morning. And we welcome all of you to our annual meeting at 11 o'clock this morning if you'd like to come. Thanks again.

Ladies and gentlemen, this concludes the conference call for today. Thank you for your participation. And you may now disconnect your lines.