Silver Wheaton acquires 25% of life of mine silver production from Barrick's Pascua-Lama project



    
    Also acquires current silver production from three additional Barrick
    mines, providing immediate cash flow

    TSX: SLW
    NYSE:   SLW
    

    VANCOUVER, Sept. 8 /CNW/ - Silver Wheaton Corp. ("Silver Wheaton" or the
"Company") (TSX, NYSE:  SLW) is pleased to announce that it has agreed to
acquire from Barrick Gold Corporation ("Barrick") 25% of the life of mine
silver production from its Pascua-Lama project, as well as 100% of the silver
production from its Lagunas Norte, Pierina and Veladero mines until the end of
2013. Silver Wheaton will pay Barrick total cash consideration of US$625
million over three years, as well as ongoing payments of the lesser of US$3.90
(subject to an annual inflation adjustment) and the prevailing market price,
for each ounce of silver delivered under the agreement.

    
    TRANSACTION HIGHLIGHTS

    - Provides Immediate Cash Flow

        - Silver Wheaton will receive 100% of the silver production from
          three of Barrick's currently producing mines, effective September
          1, 2009, until the end of 2013;
        - This immediately enhances Silver Wheaton's production and cash flow
          profile, by adding average annualized silver production of
          approximately 2.4 million ounces until Pascua-Lama commences
          production.

    - Significantly Increases Long Term Growth Profile

        - Silver Wheaton will receive 25% of the life of mine silver
          production from Barrick's Pascua-Lama project, expected to be one
          of the largest and lowest cost gold mines in the world;
        - Pascua-Lama is a key Barrick growth asset and is the third largest
          silver deposit in the world, with an estimated mine life of over
          25 years;
        - Silver Wheaton's 25% share of the estimated average annual silver
          production for the first five years (2013 to 2017) is 9 million
          ounces, boosting overall silver sales by 30% to approximately
          40 million ounces per annum;
        - Barrick has provided a completion guarantee, requiring them to
          complete Pascua-Lama to at least 75% of design capacity by
          December 31, 2015. If Barrick does not meet completion by
          December 31, 2013, Silver Wheaton will continue to receive silver
          production in 2014 and 2015 from the currently producing mines,
          until Barrick satisfies the requirements of the completion
          guarantee.
    

    "This is a transformational acquisition that propels Silver Wheaton to
the next level in terms of size and growth profile," said Peter Barnes,
President and Chief Executive Officer of Silver Wheaton. "We are extremely
excited to be partnering with Barrick, the world's largest gold mining
company, on what is expected to be one of the biggest and lowest cost gold
mines in the world. Coupled with our interest in Goldcorp's world-class
Penasquito mine in Mexico, which is currently ramping up production on
schedule, Silver Wheaton now has a significant stake in three of the top five
silver deposits in the world, of which Penasquito and Pascua-Lama are
cornerstone growth assets not just for Silver Wheaton, but also for our
operating partners."
    "This acquisition confirms Silver Wheaton as the largest of all royalty
and metals streaming companies in the world, with an unparalleled growth
profile. It is very accretive on all key metrics, increasing attributable
silver reserves by 43% and cash flow by 35%, once Pascua-Lama is in
production. The acquisition is structured so that Silver Wheaton receives
immediate cash flow, even prior to Pascua-Lama being in production,
maintaining our strong balance sheet and preserving our ability to continue
growing the Company in an accretive manner for shareholders."
    "We are very proud that, since we created this business model just five
years ago, we have demonstrated an unrivalled record of high quality
acquisitions, and now have a significant stake in nine of the top 35 silver
deposits in the world."

    TRANSACTION TERMS

    To acquire 25% of the life of mine silver production from Barrick's
Pascua-Lama project, as well as 100% of the silver production from its Lagunas
Norte, Pierina and Veladero mines until the end of 2013, Silver Wheaton will
make total upfront cash payments of US$625 million over three years, of which
US$212.5 million is payable on closing and three further payments of US$137.5
million are due on the first, second and third anniversaries. Silver Wheaton
will also make ongoing payments of the lesser of US$3.90 (subject to a one
percent annual adjustment starting in the fourth year after the achievement of
specific operating targets) and the prevailing market price, for each ounce of
silver delivered under the agreement. Silver Wheaton will not share in any
ongoing capital or exploration expenditures at the various mines.
    Barrick has provided Silver Wheaton with a completion guarantee,
requiring them to complete Pascua-Lama to at least 75% of design capacity by
December 31, 2015. During 2014 and 2015, Silver Wheaton will be entitled to
the silver production from the currently producing mines to the extent of any
production shortfall at Pascua-Lama, until Barrick satisfies the completion
guarantee. If Barrick fails to satisfy the requirements of the completion
guarantee, the agreement may be terminated by Silver Wheaton. In such an
event, Silver Wheaton would be entitled to the return of the upfront cash
consideration of US$625 million less a credit for silver delivered up to the
date of that event.
    Barrick has granted Silver Wheaton a five year right of first refusal on
any further metal stream sales in connection with Pascua-Lama, where more than
50% of the value is from silver.
    The transaction is expected to close September 22, 2009. Silver Wheaton's
financial advisor is Genuity Capital Markets and its legal counsel is Cassels
Brock & Blackwell LLP.

    FINANCING THE ACQUISITION

    To pay the initial upfront cash payment of US$212.5 million, Silver
Wheaton intends to use cash on hand (US$70 million) and for the balance may
use amounts borrowed under its revolving credit facility or the proceeds of
offerings of securities issued in the public and/or private equity capital
markets. Remaining upfront cash payments of US$137.5 million per annum, for
the next three years, are expected to be financed by operating cash flows with
no debt drawdown anticipated.

    ABOUT PASCUA-LAMA

    Pascua-Lama straddles the border of Chile and Argentina and is one of the
largest silver deposits in the world. It hosts 718 million ounces of silver in
proven and probable reserves, with additional measured and indicated silver
resources of 88 million ounces. As reported in a Barrick press release dated
May 7, 2009, expected average annual silver production in the first full five
years is approximately 35 million ounces. Anticipated total cash costs over
this period are US$20-$50 per ounce of gold which would make Pascua-Lama one
of the lowest cost gold mines in the world. Pascua-Lama is a long-life asset
with an expected mine life in excess of 25 years. Key construction permits and
environmental approvals have been received and construction is underway.
Commissioning of the mine is expected in late 2012 with production commencing
in early 2013.

    
    A TRANSFORMATIONAL YEAR - 2009 YEAR-TO-DATE HIGHLIGHTS

    - Acquired Silverstone Resources Corp., solidifying our position as the
      largest silver streaming company in the world.
    - Acquired 100% of the silver production from Barrick's currently
      producing Lagunas Norte, Pierina and Veladero mines until the end of
      2013, providing immediate cash flow, and 25% of the life of mine silver
      production from Barrick's Pascua-Lama project, adding significant long
      term growth and another cornerstone asset to Silver Wheaton's silver
      stream portfolio.
    - The Penasquito mine, soon to be one of the world's largest open pit
      mines and another one of Silver Wheaton's cornerstone assets, is
      currently ramping up production on schedule. Silver Wheaton receives
      25% of the life of mine silver production from Penasquito, which is
      expected to be the Company's main driver of growth for the next several
      years.
    - As a result of the Barrick and Silverstone acquisitions this year:
        - 2010-2012 average annual silver equivalent sales are forecast to
          increase by 26%, from approximately 25 to 31 million ounces, while
          2013-2017 average annual silver equivalent sales are forecast to
          increase by 50%, from approximately 26 to 40 million ounces;
        - Attributable silver reserves have doubled while attributable
          measured and indicated silver resources have increased by greater
          than 50%.
    - Silver Wheaton is the largest and fastest growing of all of the royalty
      and metals streaming companies in the world:
         - Unparalleled growth profile versus its peers with greater than
           250% five year sales growth forecast from 2008 levels;
         - Significant stake in three of the top five silver deposits in the
           world and in nine of the top 35.
    - Significant debt reduction resulting in a very strong financial
      position:
    - Long term debt has been reduced by approximately US$235 million and the
      Company continues to have access to a US$400 million undrawn revolving
      credit facility.
    - Well positioned to pursue additional accretive acquisitions.
    

    CONFERENCE CALL

    A conference call will be held on Tuesday, September 8, 2009, starting at
12:00 pm (Eastern Time) to discuss this transaction. To participate in the
live call use one of the following methods:

    
    Dial toll free from Canada or the US:    1-888-231-8191
    Dial from outside Canada or the US:      1-(647) 427-7450
    Pass code:                               29363920

    Live audio webcast:                      www.silverwheaton.com

    Participants should dial in five to ten minutes before the call.

    The conference call will be recorded and you can listen to an archive of
the call by one of the following methods:

    Dial toll free from Canada or the US:    1-800-642-1687
    Dial from outside Canada or the US:      1-(706) 645-9291
    Pass code:                               29363920

    Archived audio webcast:                  www.silverwheaton.com
    

    ABOUT SILVER WHEATON

    Silver Wheaton is the largest silver streaming company in the world. 
Including the Barrick transaction, forecast 2009 sales are 16 to 18 million
ounces of silver and 17,000 ounces of gold, for total sales of 17 to 19
million silver equivalent ounces, growing to approximately 39 million ounces
of silver and 20,000 ounces of gold, for total sales of approximately 40
million silver equivalent ounces, by 2013.

    Silver Wheaton's updated attributable silver reserves and resources can
be found at: http://files.newswire.ca/819/AttributabletoSLW.pdf

    Mr. Randy V.J. Smallwood, P.Eng., Silver Wheaton's Executive Vice
President of Corporate Development, who is a "qualified person" as such term
is defined under National Instrument 43-101, has reviewed and approved the
information on mineral reserves and mineral resources disclosed in this news
release.

    CAUTIONARY NOTE REGARDING FORWARD LOOKING-STATEMENTS

    The information contained herein contains "forward-looking statements"
within the meaning of the United States Private Securities Litigation Reform
Act of 1995 and applicable Canadian securities legislation. Forward-looking
statements include, but are not limited to, statements with respect to the
future price of silver, the estimation of mineral reserves and resources, the
realization of mineral reserve estimates, the timing and amount of estimated
future production, costs of production, reserve determination and reserve
conversion rates. Generally, these forward-looking statements can be
identified by the use of forward-looking terminology such as "plans",
"expects" or "does not expect", "is expected", "budget", "scheduled",
"estimates", "forecasts", "intends", "anticipates" or "does not anticipate",
or "believes", or variations of such words and phrases or statements that
certain actions, events or results "may", "could", "would", "might" or "will
be taken", "occur" or "be achieved". Forward-looking statements are subject to
known and unknown risks, uncertainties and other factors that may cause the
actual results, level of activity, performance or achievements of Silver
Wheaton to be materially different from those expressed or implied by such
forward-looking statements, including but not limited to: fluctuations in the
price of silver, the absence of control over mining operations from which
Silver Wheaton purchases silver and risks related to these mining operations,
including risks related to fluctuations in the price of the primary
commodities mined at such operations, changes in laws and regulations
including taxation policies, actual results of mining and exploration
activities, changes in project parameters as plans continue to be refined,
timing of funding the upfront cash payments, both the initial payment and the
following three annual payments payable to Barrick in connection with the
silver purchase agreement, and completion of construction of the Pascua-Lama
project, as well as those factors discussed in the section entitled
"Description of the Business - Risk Factors" in Silver Wheaton's Annual
Information Form available on SEDAR at www.sedar.com and in Silver Wheaton's
Form 40-F on file with the U.S. Securities and Exchange Commission in
Washington, D.C.. Forward-looking statements are based on assumptions
management believes to be reasonable, including but not limited to the
continued operation of the mining operations from which Silver Wheaton
purchases silver, no material adverse change in the market price of
commodities, that the mining operations will operate in accordance with their
public statements and achieve their stated production outcomes, and such other
assumptions and factors as set out herein. Although Silver Wheaton has
attempted to identify important factors that could cause actual results to
differ materially from those contained in forward-looking statements, there
may be other factors that cause results not to be as anticipated, estimated or
intended. There can be no assurance that such statements will prove to be
accurate, as actual results and future events could differ materially from
those anticipated in such statements. Accordingly, readers should not place
undue reliance on forward-looking statements. Silver Wheaton does not
undertake to update any forward-looking statements that are incorporated by
reference herein, except in accordance with applicable securities laws.

    CAUTIONARY LANGUAGE REGARDING RESERVES AND RE

SOURCES Readers should refer to the Annual Information Form of Silver Wheaton for the year ended December 31, 2008 and other continuous disclosure documents filed by Silver Wheaton since January 1, 2009 available on SEDAR at www.sedar.com, for further information on Mineral Reserves and Mineral Resources, which is subject to the qualifications and notes set forth therein as well as for additional information relating to Silver Wheaton more generally. Mineral Resources which are not Mineral Reserves, do not have demonstrated economic viability. Cautionary Note to United States Investors Concerning Estimates of Measured, Indicated and Inferred Resources: The information contained herein uses the terms "Measured", "Indicated" and "Inferred" Resources. United States investors are advised that while such terms are recognized and required by Canadian regulations, the United States Securities and Exchange Commission does not recognize them and expressly prohibits U.S. registered companies from including such terms in their filings with the SEC. "Inferred Mineral Resources" have a great amount of uncertainty as to their existence, and as to their economic and legal feasibility. It cannot be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or other economic studies. United States investors are cautioned not to assume that all or any part of Measured or Indicated Mineral Resources will ever be converted into Mineral Reserves. United States investors are also cautioned not to assume that all or any part of an Inferred Mineral Resource exists, or is economically or legally mineable. United States investors are urged to consider closely the disclosure in Silver Wheaton's Form 40-F, a copy of which may be obtained from Silver Wheaton or from http://www.sec.gov/edgar.shtml.

For further information:

For further information: Brad Kopp, Director, Investor Relations, Silver
Wheaton Corp., Tel: 1-800-380-8687, Email: info@silverwheaton.com; Website:
www.silverwheaton.com


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