World Bank funding

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Pan American completes loan and begins construction on La Colorada expansion
VANCOUVER, June 17 /PRNewswire-FirstCall/ - (all currency amounts in US
dollars)... Pan American Silver Corp. (NASDAQ: PAAS - News; TSE: PAA - News)
is pleased to announce the start of construction to quadruple production at
its La Colorada silver mine in Mexico. This follows the signing of a $10
million project debt facility with International Finance Corporation (IFC),
the private sector lending arm of the World Bank. The project's total
capital costs are estimated at about $20 million and Pan American will fund
the remaining capital from its cash on hand, currently totaling $18.7
million. Pan American will provide a corporate guarantee for the loan until
financial completion, expected by mid 2004, and will repay the loan with
semi-annual $1 million installments starting in November 2004. The loan
agreement does not require Pan American to hedge any silver production. The
increase in La Colorada's production should begin early in the third quarter
of 2003, raising Pan American's consolidated silver output from all three
mines to about 11 million ounces per year.

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