North American Palladium Announces 2009 Fourth Quarter and Year-End Results

"Although 2009 was a challenging year with our Lac des Iles ("LDI") palladium mine on care and maintenance, I am pleased with the progress made in advancing our strategic initiatives during the year," said William J. Biggar, President & CEO. "We have successfully evolved NAP into a diversified precious metals company with the acquisition of the Sleeping Giant gold mine, which reduces operating risk and provides an additional source of cash flow. With LDI set to be fully operational again early in the second quarter, NAP is well positioned to benefit from the continuing upturn in the palladium price cycle as well as the positive outlook for the gold price."

2009 Highlights

• A recovering global economy and growing auto and investment demand contributed to a strong rebound in the price of palladium from US$183 per ounce at the start of the year to US$393 per ounce at year-end. Due to the recovery in the palladium price, in December NAP announced the restart of mining operations at LDI, which is expected to be fully operational in early Q2;

• Completed 42,000 metres of exploration drilling at LDI, which resulted in the discovery of two new zones - Cowboy and Outlaw - in close proximity to the Offset Zone;

• The discovery of the new zones, as well as the palladium grade improvement encountered during infill drilling in the Offset Zone, resulted in the decision to commence initial development of the Offset Zone by developing a 1,500 metre ramp over a depth of 200 metres. The ramp, which is scheduled for completion at the end of Q4 at a cost of approximately $16 million, will provide access for the installation of a shaft to surface to mine the Offset Zone, and facilitate additional underground exploration;

• Diversified operations by acquiring Cadiscor Resources Inc., the owner of the Sleeping Giant gold mine and extensive landholdings in the Abitibi region of Quebec;

• Poured first gold at Sleeping Giant in Q4 and declared commercial production effective January 1, 2010;

• Completed 10,500 metres of extensional drilling at Sleeping Giant which resulted in the decision to commence a 200 metre deepening of the mine shaft in 2010 at a cost of $6 million;

• Raised gross proceeds of $73 million from a public offering of $58 million of common shares plus warrants, and $15 million from a private placement of flow-through shares; and

• Ended the year in a strong financial position with $98 million in cash and no long-term debt.