Agnico Eagle Reports Second Quarter 2015 Results; Strong Operational Performance Continues; Vault Extension and Goldex Deep 1 Approved for Production; Amaruq Drilling Infills and Expands Scope of Mineralization

Stock Symbol: AEM (NYSE and TSX)

For further information: Investor Relations (416) 947-1212

(All amounts expressed in U.S. dollars unless otherwise noted)

AGNICO EAGLE REPORTS SECOND QUARTER 2015 RESULTS; STRONG OPERATIONAL PERFORMANCE CONTINUES; VAULT EXTENSION AND GOLDEX DEEP 1 APPROVED FOR PRODUCTION; AMARUQ DRILLING INFILLS AND EXPANDS SCOPE OF MINERALIZATION

Toronto (July 29, 2015) – Agnico Eagle Mines Limited (NYSE:AEM, TSX:AEM) ("Agnico Eagle" or the “Company”) today reported quarterly net income of $10.1 million, or net income of $0.05 per share for the second quarter of 2015. This result includes non-recurring losses of $12.9 million ($0.06 per share), unrealized gains on financial instruments of $9.4 million ($0.04 per share), non-cash foreign currency translation losses of $4.8 million ($0.02 per share), non-cash stock option expense of $4.1 million ($0.02 per share), a non-cash foreign currency translation gain on deferred tax liabilities of $3.2 million ($0.01 per share) and various mark-to-market and other adjustment gains of $0.8 million ($0.01 per share). Excluding these items would result in adjusted net income of $18.5 million or adjusted net income of $0.09 per share for the second quarter of 2015. In the second quarter of 2014, the Company reported net income of $22.2 million or net income of $0.12 per share.

For the first six months of 2015, the Company reported net income of $38.8 million, or $0.18 per share. This compares with the first six months of 2014 when net income was $119.3 million, or $0.66 per share. Financial results in the 2015 period were negatively impacted by lower gold prices (approximately 8% lower) and lower by-product metals revenues.

Second quarter 2015 cash provided by operating activities was $188.3 million ($152.8 million before changes in non-cash components of working capital). This compares to cash provided by operating activities of $182.7 million in the second quarter of 2014 ($136.5 million before changes in non-cash components of working capital). The increase in cash provided by operating activities before changes in working capital during the current period was mainly due to an increase of 24% in gold production.

For the first six months of 2015, cash provided by operating activities was $331.8 million ($329.6 million before changes in non-cash components of working capital), as compared with the first half of 2014 when cash provided by operating activities was $433.1 million ($343.6 million before changes in non-cash components of working capital). The decrease in cash provided by operating activities before changes in working capital during the period was mainly due to a decrease of 8% in gold prices compared to the 2014 period, which more than offset a 17% increase in gold production.

"With continued strong operating performance, favourable local currency foreign exchange rates, and near-term opportunities to increase production at several of our mines, we remain well-positioned to manage the current price volatility in the gold market", said Sean Boyd, Agnico Eagle’s Chief Executive Officer. “In these challenging times, we will continue to focus on reducing costs and we will remain measured in our approach to managing and growing our business", added Mr. Boyd.

Second Quarter 2015 highlights include:

• Quarterly gold production – Payable gold production¹ in Q2 2015 was 403,678 ounces of gold at total cash costs² per ounce on a by-product basis of $601 and all-in sustaining costs³ (“AISC”) on a by-product basis of $864 per ounce
• Second consecutive record quarter of precious metal production from Mexican operations - In the second quarter of 2015, payable gold and silver production from Mexican operations was 92,056 ounces and 685,869 ounces,

1 Payable production of a mineral means the quantity of mineral produced during a period contained in products that are sold by the Company, whether such products are shipped during the period or held as inventory at the end of the period.

2 Total cash costs per ounce is a non-GAAP measure. For a reconciliation to production costs, see “Reconciliation of Non-GAAP Financial Performance Measures below. Total cash costs per ounce of gold produced is calculated on both a by-product basis (deducting by-product metal revenues from production costs) and co-product basis (before by-product metal revenues). Total cash costs per ounce of gold produced on a by-product basis is calculated by adjusting production costs as recorded in the consolidated statements of income (loss) for by-product revenues, unsold concentrate inventory production costs, smelting, refining and marketing charges and other adjustments, and then dividing by the number of ounces of gold produced. Total cash costs per ounce of gold produced on a co-product basis is calculated in the same manner as total cash costs per ounce of gold produced on a by-product basis except that no adjustment for by-product metal revenues is made. See “Note Regarding Certain Measures of Performance”. For information about the Company’s total cash costs per ounce on a co-product basis please see “Reconciliation of Non-GAAP Performance Measures”.

3All-in-sustaining costs is a non-GAAP measure and is used to show the full cost of gold production from current operations. For a reconciliation to production costs, see “Reconciliation of Non-GAAP Financial Performance Measures – Reconciliation of Production Costs to All-In Sustaining Costs” below. The Company calculates All-in sustaining costs per ounce of gold produced as the aggregate of total cash costs on a by-product basis, sustaining capital expenditures (including capitalized exploration), general and administrative expenses (including stock option expense) and reclamation expenses divided by the amount of gold produced. Reference to all-in sustaining costs per ounce of gold produced in this news release is calculated on a by-product basis as described above. All-in sustaining costs per ounce of gold produced on a co-product basis is calculated in the same manner as total cash costs per ounce of gold produced on a by-product basis except that no adjustment for by-product metal revenues is made. The Company's methodology for calculating all-in sustaining costs may not be similar to the methodology used by other producers that disclose all-in sustaining costs. See "Note Regarding Certain Measures of Performance". The Company may change the methodology it uses to calculate all-in sustaining costs in the future, including in response to the adoption of formal industry guidance regarding this measure by the World Gold Council.

respectively. Total cash costs per ounce of gold on a by-product basis averaged $394

• 2015 production guidance maintained and cost forecasts reduced – Expected gold production for 2015 is maintained at approximately 1.6 million ounces with total cash costs on a by-product basis of $600 to $620 per ounce (previously $610 to $630) and AISC of approximately $870 to $890 per ounce (previously $880 to $900)
• Vault Extension and Goldex Deep 1 approved for mining; 2015 capital for both projects increased by a total of approximately $36 million – The Vault extension is expected to reduce the potential production gap between the end of production at Meadowbank and the start of production at Amaruq (not yet approved for construction) by approximately one year. Goldex Deep 1 adds approximately seven years of production at approximately 100,000 ounces of gold per year
• Drilling at Amaruq’s Whale Tail deposit confirms grades and thicknesses; mineralization extended to depth – Highlights include: 13.2 grams per tonne (“g/t”) gold over 14.3 metres at 133 metres depth, and 13.9 g/t gold over 11.0 metres at 194 metres depth. The deepest intercept to date on the property yielded 8.8 g/t gold over 6.0 metres at 568 metres depth, almost 200 metres deeper than previous intercepts
• Continued focus on debt reduction – In Q2 2015, $25 million was repaid under the Company’s credit facility, C$20 million (reflecting the Company’s 50% interest) was repaid under the Canadian Malartic General Partnership (the “Partnership”) secured loan facility, and the Canadian Malartic senior unsecured convertible debentures (C$37.5 million, reflecting the Company’s 50% interest) were fully converted by the holders. As a result, the Company’s indebtedness was reduced by approximately $70 million
• A quarterly dividend of $0.08 per share was declared

Second Quarter Financial and Production Highlights

In the second quarter of 2015, strong operational performance continued at the Company's mines.

Payable gold production in the second quarter of 2015 was 403,678 ounces compared to 326,059 ounces in the second quarter of 2014. The higher level of production in the 2015 period was primarily due to the inclusion of a full quarter of production from Canadian Malartic, increased throughput levels at Goldex, increased mill capacity at Kittila, higher grades at LaRonde and Pinos Altos and increased heap leach stacking at La India and Creston Mascota. A detailed description of the production and cost performance of each mine is set out below.

Total cash costs per ounce on a by-product basis for the second quarter of 2015 were lower at $601 versus $631 per ounce for the second quarter 2014. The reduction in total cash costs per ounce on a by-product basis in the second quarter of 2015 was a result of higher silver production, higher gold production at most of the Company’s mines and weaker local currencies compared to the second quarter of 2014.

In the second quarter of 2015 the value of the Canadian dollar, Euro and Mexican Peso were 1%, 2%, and 17% lower, respectively than the Company’s 2015 currency price assumptions (see February 11, 2015 news release).

Payable gold production for the first half of 2015 was 807,888 ounces, compared to payable gold production of 692,480 ounces in the comparable 2014 period (which included only 11,878 ounces from Canadian Malartic for production from June 16 to June 30, 2014).

For the first half of 2015, total cash costs on a by-product basis were $595 per ounce. This compares with $582 per ounce on a by-product basis in the first half of 2014. The higher costs in the 2015 period are due to the increased costs at Meadowbank when compared to the 2014 period. In 2014, Meadowbank had record production and lower costs as a result of processing higher grade ore from the Goose and reserve grade ore from the Portage deposits.

AISC for the second quarter of 2015 was lower at $864 versus $1,003 per ounce for the second quarter 2014. The lower AISC is primarily due to higher production, lower than forecast total cash costs per ounce on a by-product basis, lower G&A expenditures and timing of capital expenditures.

For the first half of 2015, AISC was $835 versus $890 per ounce for the 2014 period. The lower AISC in the 2015 period are due to the same reasons set out above.

Cash Position Remains Strong; Debt Levels Reduced; and Capex Increased to Fund Near-term Production Opportunities

Cash and cash equivalents and short term investments increased to $183.9 million at June 30, 2015, from the March 31, 2015 balance of $172.1 million.

The outstanding balance on the Company’s $1.2 billion credit facility was reduced from $400 million at March 31, 2015 to $375 million at June 30, 2015. This results in available credit lines of approximately $825 million, as well as the $300 million accordion feature.

As of June 30, 2015, C$20 million (reflecting the Company’s 50% interest) was repaid under the Canadian Malartic General Partnership secured loan facility. Also, the Canadian Malartic convertible debentures with principal outstanding of C$37.5 million (reflecting the Company’s 50% interest), assumed with the joint acquisition of Osisko Mining Corporation (“Osisko”) on June 16, 2014, was fully converted by the holders.

Total capital expenditures made by the Company in the second quarter of 2015 were $111.5 million, including $18.9 million at LaRonde, $18.2 million at Meadowbank, $17.2 million at Pinos Altos, $13.9 million at Kittila, $12.0 million at Goldex, $11.4 million at Meliadine, $10.7 million at Canadian Malartic (50% basis), $6.2 million at La India, $1.7 million at Lapa and $0.2 million at Creston Mascota.

Total capital expenditures for the first six months of 2015 were $194.4 million including $35.5 million at LaRonde, $29.3 million at Pinos Altos, $27.7 million at Meadowbank, $24.3 million at Kittila, $21.9 million at Goldex, $21.4 million at Canadian Malartic (50% basis), $19.8 million at Meliadine, $8.5 million at La India, $4.4 million at Lapa and $0.5 million at Creston Mascota.

Total sustaining capital expenditures made by the Company in the second quarter were $81.9 million, including $18.9 million at LaRonde, $18.2 million at Meadowbank, $11.1 million at Kittila, $10.6 million at Canadian Malartic (50% basis), $10.3 million at Pinos Altos, $6.2 million at La India, $4.7 million at Goldex, $1.7 million at Lapa, and $0.2 million at Creston Mascota.

Total sustaining capital expenditures for the first six months of 2015 were $142.8 million including $35.5 million at LaRonde, $27.7 million at Meadowbank, $20.1 million at Kittila, $19.8 million at Canadian Malartic (50% basis), $17.3 million at Pinos Altos, $9.0 million at Goldex, $8.5 million at La India, $4.4 million at Lapa, and $0.5 million at Creston Mascota.

For 2015, capital expenditures are expected to total approximately $539 million, representing a $58 million increase from the previously announced figure. The increase is primarily due to additional expenditures for the development of Goldex Deep 1, the Vault pit extension, expansion of the existing Meliadine surface and underground infrastructure, and the sealift of additional equipment for the 2016 Meliadine work program.

Based on the exploration success in the first six months of the year, the 2015 expensed exploration budget has been increased by approximately $20 million to $114 million. The additional expenditure includes a phase two exploration program at the Amaruq project; an initial exploration program at the Barsele project in Sweden; a slight increase in exploration spending at the Pandora property and the Odyssey deposits; and additional drilling on the new parallel zone at Kittila. Expenditures at Amaruq and El Barqueno could potentially increase further, based on exploration results.

Revised 2015 Guidance – Production Maintained, Costs Lowered, Depreciation Increased

Production guidance for 2015 is maintained at approximately 1.6 million ounces of gold with total cash costs on a by-product basis of $600 to $620 per ounce (previously $610 to $630) and AISC of approximately $870 to $890 per ounce (previously $880 to $900).

The Company expects depreciation and amortization expense to be in the range of $575 to $600 million. Previous guidance was $550 to $575 million. The increase is primarily due to the finalization of the purchase price allocation associated with the Canadian Malartic acquisition.

Second Quarter 2015 Results Conference Call and Webcast Tomorrow

The Company's senior management will host a conference call on Thursday, July 30, 2015 at 11:00 AM (E.D.T.) to discuss financial results and provide an update of the Company’s operating activities.

Via Webcast:

A live audio webcast of the meeting will be available on the Company's website www.agnicoeagle.com.

Via Telephone:

For those preferring to listen by telephone, please dial 1-416-260-0113 or Toll-free 1-800- 524-8950. To ensure your participation, please call approximately five minutes prior to the scheduled start of the call.

Replay Archive:

Please dial 1-647-436-0148 or Toll-free 1-888-203-1112, access code 6325908. The conference call replay will expire on August 30, 2015.

The webcast, along with presentation slides, will be archived for 180 days on www.agnicoeagle.com.

NORTHERN BUSINESS OPERATING REVIEW

ABITIBI REGION, QUEBEC

Agnico Eagle is currently Quebec’s largest gold producer with a 100% interest in three mines (LaRonde, Goldex and Lapa) and a 50% interest in the Canadian Malartic mine. These mines are located within 50 kilometres of each other, which provides operating synergies and allows for the sharing of technical expertise.

LaRonde Mine – Gold Production Steadily Increasing, Commissioning of Coarse Ore Conveyor on Track for Late Q3 2015

The 100% owned LaRonde mine in northwestern Quebec achieved commercial production in 1988.

The LaRonde mill processed an average of 6,242 tonnes per day (“tpd”) in the second quarter of 2015, compared with an average of 6,197 tpd in the corresponding period of 2014. Minesite costs per tonne⁴ were approximately C$99 in the second quarter of 2015, higher than the C$96 per tonne experienced in the second quarter of 2014. The increased costs in the 2015 period were primarily due to higher underground development, mill maintenance and site administration costs compared to the prior-year period.

For the first six months of 2015, the LaRonde mill processed an average of 6,223 tpd, compared to 6,194 tpd in the first six months of 2014. Minesite costs per tonne were approximately C$101, compared to C$96 per tonne in the first six months of 2014. Costs were higher due to the reasons described above in spite of the higher throughput.

LaRonde's total cash costs per ounce on a by-product basis were $613 in the second quarter of 2015 on payable production of 64,007 ounces of gold. This compares with the second quarter of 2014 when total cash costs per ounce on a by-product basis were $732 on production of 48,494 ounces of gold. Costs in the 2015 period were positively impacted by higher gold grades and favourable foreign exchange rates.

In the first six months of 2015, LaRonde produced 122,900 ounces of gold at total cash costs per ounce of $656 on a by-product basis. This is in contrast with the first six months of 2014 when the mine produced 107,846 ounces of gold at total cash costs per ounce of $645 on a by-product basis. Production in the 2015 period was positively impacted by higher grades. Costs were lower in the 2014 period due to higher byproduct production and revenues.

During the quarter, work continued on the installation of the coarse ore conveyor system that will extend from the 293 level to the crusher on the 280 level. Installation of the new

4 Minesite costs per tonne is a non-GAAP measure. For a reconciliation of this measure to production costs as reported in the financial statements, see “Reconciliation of Non-GAAP Financial Performance Measures – Reconciliation of Production Costs to Minesite Costs per Tonne by Mine” below. See also “Note Regarding Certain Measures of Performance”.

conveyor and the connection of an internal ramp at the 281 level are expected to be completed by the end of the third quarter of 2015. These two infrastructure components should help to improve mining flexibility and reduce congestion in the deeper portions of the mine.

Studies are continuing to assess the potential to extend the mineral reserve base and carry out mining activities between the 311 and 371 levels at LaRonde. At present, the mineral reserve base extends to the 311 level, which is 3.1 kilometres below the surface. In 2014, conversion drilling added approximately 444,000 ounces of gold (2.6 million tonnes at 5.33 g/t gold) to the indicated mineral resources between the 311 and 341 levels.

Drilling is ongoing to further expand the known mineral resource between the 311 and 341 levels. Additional holes are also being drilled to evaluate the extent of the mineralization down to the 371 level (a depth of 3.7 km below the surface).

Canadian Malartic Mine – Mining Productivity Improves, North Zone Mining Rate Increases in Q2 2015

In June 2014, Agnico Eagle and Yamana Gold Inc. ("Yamana") acquired all of the issued and outstanding common shares of Osisko and created the Canadian Malartic General Partnership (the “Partnership”) that owns and operates the Canadian Malartic mine in northwestern Quebec through a joint management committee. Each of Agnico Eagle and Yamana has an indirect 50% ownership interest in the Partnership.

During the second quarter of 2015, the Canadian Malartic mill processed an average of 50,705 tpd (on a 100% basis). This period included a five day planned shutdown for maintenance to the crushing and grinding circuit, and two days of unplanned maintenance on the conveying system, which reduced mill availability. Comparisons with the 2014 period are not relevant given that the Partnership only took control of the operations on June 16, 2014. Minesite costs per tonne were approximately C$20 (C$23 including royalties), which was in line with guidance. The average stripping ratio in the second quarter of 2015 was 2.64 to 1.0.

For the first six months of 2015, the Canadian Malartic mill processed an average of 51,343 tpd. Minesite costs per tonne were approximately C$20 (C$23 including royalties).

For the second quarter of 2015, Agnico Eagle’s share of production at the Canadian Malartic mine was 68,441 ounces of gold at total cash costs per ounce of $609 on a byproduct basis.

In the first six months of 2015, Agnico Eagle’s share of production at the Canadian Malartic mine was 136,334 ounces of gold at total cash costs per ounce of $621 on a byproduct basis.

Since acquiring the mine in June 2014, the Partnership has been working on several initiatives to optimize the operations. Current opportunities include:

• Improving SAG mill liners in an attempt to reduce the number of planned shutdowns to three per year (currently four per year)
• Increasing gyratory crusher availability by redirecting ore containing scrap steel to a separate crusher
• Maintaining mining throughput levels at two million tonnes per month in the North zone (which contains higher grades)
• Waste rock backfilling of the Gouldie pit, to reduce haulage distances and noise

In the first quarter of 2015, the Partnership reported that discussions were ongoing with permitting authorities regarding pre-crushing activities at Canadian Malartic. In the second quarter of 2015, discussions about improving the efficiency and environmental performance of the existing mobile crusher took place with the Quebec Ministry of Sustainable Development, Environment, Wildlife and Parks. The Ministry is reviewing this concept and an application for a Certificate of Authorization is being prepared for possible submission later this year. At this point, milling levels are expected to be approximately 53,000 tpd through 2016. For the full year 2015, Agnico Eagle’s estimated share of gold production from Canadian Malartic remains unchanged at 280,000 ounces.

Permitting activities for the Barnat Extension and deviation of Highway 117 are continuing. An Environmental Impact Assessment (“EIA”) was submitted in February 2015, and questions were received from permitting authorities in April and May 2015. Answers to the first round of questions are expected to be submitted by the end of August 2015. The process remains on schedule for receipt of the necessary permits in November 2016.

In March 2015, the Partnership increased its interest in the Malartic CHL property to 100% by acquiring the remaining 30% interest from Abitibi Royalties Inc. (RZZ:TSX-V). The Malartic CHL property adjoins the Canadian Malartic mine to the east and hosts part of the Odyssey North discovery. Drilling continues on the Odyssey North and Odyssey South zones with data currently being compiled and interpreted.

Exploration Update on Pandora and Kirkland Lake Projects

Canadian Malartic Corporation, a company in which each of Agnico Eagle and Yamana has an indirect 50% interest, is exploring, among other things, a portfolio of properties in the Kirkland Lake area of Ontario and the Pandora property in the Abitibi region of Quebec.

At the Upper Beaver property in Kirkland Lake, a mineral resource update is underway and the Partnership will decide the best alternative to develop the property.

At Pandora, underground development on the 101-W exploration drift from the adjacent Lapa mine commenced in February 2015 and approximately 285 metres of drifting was completed during the second quarter of 2015. Approximately 433 metres of development has been completed year to date, and for the full year, approximately 940 metres of development is planned.

In mid-June 2015, exploration drilling resumed from the 101-W drift and approximately 7,400 metres of underground drilling is planned in 2015 to test for extensions to the Branch zone and C zone on the Pandora property.

Lapa – Zulapa Z7 Zone Continues to Yield Higher Grades and Recoveries

The 100% owned Lapa mine in northwestern Quebec achieved commercial production in May 2009.

The Lapa circuit, located at the LaRonde mill, processed an average of 1,387 tpd in the second quarter of 2015. This compares with an average of 1,789 tpd in the second quarter of 2014. Throughput in the 2015 period was lower because of downtime related to the discovery of fatigue cracks in the feed head of the Lapa ball mill. This component is being repaired and ore is currently being processed through the old LaRonde copper regrind circuit. As a result, throughput levels are expected to be lower than normal through at least the middle of the third quarter of 2015. Excess ore is currently being stockpiled and there is sufficient mill capacity that should allow the Company to meet its annual throughput rate (tonnes and ounces) over the balance of 2015.

Minesite costs per tonne were C$126 in the second quarter of 2015, compared to the C$105 in the second quarter of 2014. Costs in the 2015 period were higher due to lower throughput compared to the same period in 2014.

For the first six months of 2015, the Lapa mill processed an average of 1,538 tpd, compared to 1,769 tpd in the first six months of 2014. Minesite costs per tonne were approximately C$122, above the C$107 per tonne in the first six months of 2014 due to reasons explained above.

Payable production in the second quarter of 2015 was 19,450 ounces of gold at total cash costs per ounce on a by-product basis of $678. This compares with the second quarter of 2014, when production was 18,821 ounces of gold at total cash costs per ounce on a by-product basis of $832. In the 2015 period, production was higher and costs were lower due to higher gold grades, better recoveries and favourable foreign exchange rates.

In the first six months of 2015, Lapa produced 45,370 ounces of gold at total cash costs per ounce of $615 on a by-product basis. This compares to the first six months of 2014 when the mine produced 42,230 ounces of gold at total cash costs per ounce of $738 on a by-product basis. The higher production and lower costs in the 2015 period are due to the reasons outlined above.

At Lapa, 2015 is the last full year of production based on the current life of mine plan. In 2016, production is expected to exhibit a decline from the current level. Additional exploration drilling is ongoing in the Zulapa Z7 zone at depth and, if successful, could extend Lapa’s mine life.

Goldex – Deep 1 Project Approved for Mining; Production Expected to Extend Through 2024

The 100% owned Goldex mine in northwestern Quebec began operation in 2008 but mining operations in the original orebody, the Goldex Extension Zone (“GEZ”) were suspended in October 2011 (see October 19, 2011 news release). In July 2012, the M and E satellite zones were approved for development. Mining operations resumed on the M and E satellite zones in September 2013. Mining operations at GEZ remain suspended.

The Goldex mill processed an average of 6,640 tpd in the second quarter of 2015. This compares with an average of 5,692 tpd in the second quarter of 2014. The higher throughput in the 2015 period was due to more mature mining fronts and productivity improvements compared to the 2014 period.

Minesite costs per tonne were approximately C$34 in the second quarter of 2015, which was essentially unchanged from the C$34 per tonne experienced in the second quarter of 2014.

For the first six months of 2015, the Goldex mill processed an average of 6,468 tpd, compared to 5,544 tpd in the first six months of 2014. Minesite costs per tonne were approximately C$34, the same as the first six months of 2014.

Payable gold production in the second quarter of 2015 was 26,462 ounces of gold at total cash costs per ounce on a by-product basis of $633. This compares with the second quarter of 2014, when production was 23,929 ounces of gold at total cash costs per ounce on a by-product basis of $670. The decrease in total cash costs in the 2015 period was largely a result of increased production due to higher tonnage and favourable foreign exchange rates compared to the 2014 period.

In the first six months of 2015, Goldex produced 55,712 ounces of gold at total cash costs per ounce of $585 on a by-product basis. This compares to the first six months of 2014 when the mine produced 43,359 ounces of gold at total cash costs per ounce of $711 on a by-product basis. The higher production and lower costs in the 2015 period are due to the same reasons as outlined above.

Following the completion of a positive internal technical study, the Goldex Deep 1 Project was approved for production by Agnico Eagle’s Board of Directors.

The study focused on mining the lower part of the Dx zone and the top of D zone (see Goldex composite longitudinal section below) from a depth of 850 metres to 1,200 metres (Level 120). The Company plans to undertake development from the current Goldex infrastructure, with existing equipment and personnel. The planned mining method is long-hole stoping with cemented paste backfill, which is the same method currently used at Goldex.

Mineralogy in the D and Dx zones is very similar to what is currently being mined in M, M2, M5, E and E2 zones. Metallurgical testing of both the D and Dx zones has indicated that recoveries for the Deep 1 project are expected to be approximately 91.5%, which is in line with current recoveries at Goldex. No changes to the processing plant are anticipated. Tailings deposition at the Manitou site is expected to continue, as the site has ample capacity.

The mining rate for Deep 1 is expected to be approximately 6,000 tpd, which would allow for the potential processing of up to 2,000 tpd of ore from other sources such as the Akasaba West Project. The average grade milled is expected to be approximately 1.69 g/t gold and the minesite costs per tonne are estimated to be approximately C$35 to C$40.

Gold production is expected to average in excess of 100,000 oz per year from 2018 through 2024 at an average total cash cost per ounce on a by-product basis of between $610 and $630. Development capital is forecast to be approximately $135 to $140 million, and sustaining capital is estimated at approximately $60 to $70 million per year. The development capital includes the cost of the installation of an automated conveyor system.

The Dx zone contains approximately 51,000 ounces of gold in indicated mineral resources (0.7 million tonnes at 2.12 g/t gold) and approximately 172,000 ounces of gold in inferred mineral resources (3.7 million tonnes at 1.46 g/t gold). The D zone contains approximately 727,000 ounces of gold in indicated mineral resources (10.2 million tonnes at 2.21 g/t gold) and approximately 709,000 ounces of gold in inferred mineral resources (12.9 million tonnes at 1.70 g/t gold). Additional details on the Goldex resources are presented in the table below:

Category	Gold (g/t)	Gold (oz) (x000)	Tonnes (x000)
Measured Resources (Underground) GEZ	1.86	739	12,360
Total Measured Resources	1.86	739	12,360
Indicated Resources (Underground)
GEZ	1.60	401	7,807
Dx zone	2.12	51	744
D zone	2.21	727	10,228
Other zones*	2.09	176	2,630
Total Indicated Resources	1.97	1,356	21,409