VANCOUVER, British Columbia – January 27, 2022 – Silvercorp Metals Inc. (“Silvercorp” or the “Company”) (TSX: SVM) (NYSE American: SVM) is pleased to report additional high-grade intercepts from its 2021 exploration program at the TLP mine. Extensive exploration drilling and tunneling are ongoing at the TLP mine and all other mines in the Ying Mining District, Henan Province, China.
From June 1 to December 31, 2021, 43,573 metres (“m”) from a total of 276 diamond drill holes, including 218 underground holes and 58 surface holes, were completed at the TLP mine. Assay results for 270 holes have been received, with 202 holes intercepting mineralization. The Company also received assay results for 35 holes pending from the previous drilling program at the TLP mine from October 1, 2020 to May 31, 2021 disclosed in the Company’s news release dated June 1, 2021. Currently, there are 13 rigs drilling at the TLP mine.
The strategy of the drilling program is fourfold: 1) drill above or beneath the stopes that were previously mined but stopped due to more variation in grades, thickness and attitudes of the vein structures than previously modeled to easily obtain ore; 2) drill for high-grade silver-lead-zinc veins within the resource area; 3) drill for silver-lead-zinc veins in the resource area at higher elevations near the surface where there are limited drill holes from previous drilling programs; and 4) drill for high-grade silver-lead-zinc veins at the northwest side of the resource area to expand the resources.
Drilling Above or Beneath Previously Mined Stopes
Most holes drilled during the period targeted blocks of known silver-lead-zinc veins in production areas that were previously missed due to limited drilling or tunneling, changes in the strikes and dips, and/or pinch-swelling of the pay-zones in the veins. The high-grade intercepts are mainly associated with the southwest-striking T15 series, T16 series, T17W, T11, T20, T21, T30, T3 series, T4 series, T5 series, T1, and T2, and the north-northwest-striking T14 series, T22, T28, and T31 series. Drilling discovered additional splay and parallel vein structures T16E3, T4E, T4W, T5E2, and T5a. This drilling has resulted in a significant amount of upgraded resources for near-term mine planning and production. Since access tunnels are already in place, the upgraded high-grade resource blocks can quickly be converted to reserves and mined.
Highlights of the high-grade intercepts at the TLP mine:
- Underground hole ZKG0712 intersected a 1.36 m interval (1.03 m true width) of vein T11 grading 2,042 grams per tonne (“g/t”) silver (“Ag”), 36.86% lead (“Pb”), 6.73% zinc (“Zn”), 0.43 g/t gold (“Au”), and 0.83% copper (“Cu”) from 211.32 m depth, at an elevation of 632 m;
- Underground hole ZKG4T1601 intersected a 4.03 m interval (2.27 m true width) of vein T16 grading 1,003 g/t Ag, 8.93% Pb, 0.83% Zn, 0.16 g/t Au, and 0.10% Cu from 79.56 m depth, at an elevation of 762 m;
- Underground hole ZKG0305 intersected a 1.11 m interval (1.11 m true width) of vein T15W grading 1,597 g/t Ag, 14.71% Pb, 0.39% Zn, 0.08 g/t Au, and 0.41% Cu from 44.89 m depth, at an elevation of 782 m;
- Underground hole ZKT0210 intersected a 3.59 m interval (3.57 m true width) of vein T3 grading 581 g/t Ag, 8.83% Pb, 0.63% Zn, 0.05 g/t Au, and 0.05% Cu from 250.35 m depth, at an elevation of 787 m; and
- Underground hole ZKG0832 intersected a 1.40 m interval (0.95 m true width) of vein T15W grading 994 g/t Ag, 29.33% Pb, 0.77% Zn, 0.05 g/t Au, and 0.11% Cu from 70.64 m depth, at an elevation of 810 m.
Drilling Silver-Lead-Zinc Veins within the Resource Area Intersected Unexpected High-Grade Gold Veins
Drilling intersected two types of gold mineralization in gold-silver-lead-zinc veins and gold veins, respectively. The former is thought to be formed by gold mineralization in the vein structures which was then overprinted by silver-lead-zinc mineralization with quartz-sericite alteration. Most of this type of gold mineralization occurs at elevations between 700 m and 760 m. The latter mineralization is predominantly composed of gold with no or low silver-lead-zinc mineralization in shear structures associated with quartz-ankerite alteration at higher elevations above 830 m.
Highlights of the high-grade gold and gold-silver-lead-zinc intercepts within the TLP resource area:
- Surface hole ZKTDB3504 intersected a 1.46 m interval (true width unknown) of an unknown gold vein grading 8 g/t Ag, 0.02% Pb, 0.02% Zn, 13.96 g/t Au, and 0.01% Cu from 91.12 m depth, at an elevation of 909 m;
- Underground hole ZKT0016 intersected a 1.01 m interval (0.79 m true width) of gold vein T1W grading 12 g/t Ag, 0.12% Pb, 0.02% Zn, 13.91 g/t Au, and 0.01% Cu from 95.26 m depth, at an elevation of 861 m;
- Underground hole ZKT1124 intersected a 2.04 m interval (1.70 m true width) of vein T2 grading 281 g/t Ag, 3.32% Pb, 0.52% Zn, 6.83 g/t Au, and 0.59% Cu from 56.78 m depth, at an elevation of 749 m; and
- Underground hole ZKT1351 intersected a 1.31 m interval (0.88 m true width) of vein T1W1 grading 7 g/t Ag, 0.02% Pb, 0.03% Zn, 6.09 g/t Au, and 0.01% Cu from 97.95 m depth, at an elevation of 836 m.
Near Surface Silver-Lead-Zinc Veins Intersected by Surface and Underground Drilling within the TLP Resource Area
Surface and underground diamond drilling tested certain blocks near the surface in the central and northeast parts of the TLP resource area, and intersected high-grade silver-lead-zinc veins T1, T2, T3 series, T4, T5, and T20. The surface holes also intersected thick mineralization in T2 and T3. Surface hole ZKTDB0605, for instance, intersected vein T3 with a true width of 7.44 m. The purpose of this drilling is to extend the resources to higher elevations within the current resource area. The aforementioned drilling also discovered T5E2, a splay and parallel vein to T5.
Highlights of the high-grade/thick silver-lead-zinc intercepts near surface at the TLP mine:
- Surface hole ZKTDB2001 intersected a 0.87 m interval (0.82 m true width) of vein T3 grading 2,871 g/t Ag, 2.47% Pb, 0.79% Zn, 0.05 g/t Au, and 1.63% Cu from 157.40 m depth, at an elevation of 1,027 m;
- Surface hole ZKTDB0608 intersected a 3.38 m interval (1.42 m true width) of vein T2W2 grading 1,052 g/t Ag, 4.38% Pb, 0.14% Zn, 0.05 g/t Au, and 0.10% Cu from 164.11 m depth, at an elevation of 1,075 m;
- Surface hole ZKTDB0605 intersected a 9.45 m interval (7.44 m true width) of vein T3 grading 168 g/t Ag, 1.41% Pb, 0.18% Zn, 0.05 g/t Au, and 0.02% Cu from 25.96 m depth, at an elevation of 1,144 m;
- Surface hole ZKTDB0601 intersected a 7.23 m interval (6.81 m true width) of vein T2 grading 133 g/t Ag, 2.63% Pb, 0.11% Zn, 0.02 g/t Au, and 0.01% Cu from 19.16 m depth, at an elevation of 1,151 m; and
- Underground hole ZKT0442 intersected a 29.93 m interval (24.51 m true width) of vein T1W1 grading 104 g/t Ag, 1.35% Pb, 0.27% Zn, 0.05 g/t Au, and 0.02% Cu from 26.72 m depth, at an elevation of 862 m.
Drilling Intersected High-Grade Silver-Lead-Zinc Veins at the Northwest Side of the Resource Area
At the northwest side of the resource area, drilling intersected high-grade silver-lead-zinc vein T33, and its parallel vein T33W3. This drilling is to support the Company’s strategy to expand the resources laterally.
Tunneling Programs at the TLP Mine
A total of 6,982 m of exploration tunnels were developed at the TLP mine during this period. The exploration tunneling, comprised of drifting, cross-cutting and raising, was driven along and across major mineralized vein structures to upgrade the drill-defined mineral resources, and to test for new parallel and splay structures (Tables 2 and 3).
Quality Control
Drill cores are NQ size. Drill core samples, limited by apparent mineralization contacts or shear/alteration contacts, were split into halves by saw cutting. The half cores are stored in the Company’s core shacks for future reference and checks, and the other half core samples are shipped in securely sealed bags to the Chengde Huakan 514 Geology and Minerals Test and Research Institute in Chengde, Hebei Province, China, 226 km northeast of Beijing, the Zhengzhou Nonferrous Exploration Institute Lab in Zhengzhou, Henan Province, China, and SGS in Tianjin, China. All three labs are ISO9000 certified analytical labs. For analysis, the sample is dried and crushed to minus 1 mm and then split into a 200-300 g subsample which is further pulverized to minus 200 mesh. Two subsamples are prepared from the pulverized sample. One is digested with aqua regia for gold analysis with atomic absorption spectroscopy (“AAS”), and the other is digested with two-acids for analysis of silver, lead, zinc and copper with AAS.
Channel samples are collected along sample lines perpendicular to the mineralized vein structure in exploration tunnels. Spacing between sampling lines is typically 5 m along strike. Both the mineralized vein and the altered wall rocks are cut by continuous chisel chipping. Sample length ranges from 0.2 m to more than 1 m, depending on the width of the mineralized vein and the mineralization type. Channel samples are prepared and assayed with AAS at Silvercorp’s mine laboratory (“Ying Lab”) located at the mill complex in Luoning County, Henan Province, China. The Ying lab is officially accredited by the Quality and Technology Monitoring Bureau of Henan Province and is qualified to provide analytical services. The channel samples are dried, crushed and pulverized. A 200 g sample of minus 160 mesh is prepared for assay. A duplicate sample of minus 1 mm is made and kept in the laboratory archives. Gold is analysed by fire assay with AAS finish, while silver, lead, zinc and copper are assayed by two-acid digestion with AAS finish.
A routine quality assurance/quality control (“QA/QC”) procedure is adopted to monitor the analytical quality at each lab. Certified reference materials (CRMs), pulp duplicates and blanks are inserted into each batch of lab samples. QA/QC data at the lab are attached to the assay certificates for each batch of samples.
The Company maintains its own comprehensive QA/QC program to ensure best practices in sample preparation and analysis of the exploration samples. Project geologists regularly insert CRMs, field duplicates and blanks to each batch of 30 core samples to monitor the sample preparation and analysis procedures at the labs. The analytical quality of the labs is further evaluated with external checks by sending approximately 3-5% of the pulp samples to higher level labs to check for lab bias. Data from both the Company’s and the labs’ QA/QC programs are reviewed on a timely basis by project geologists.
Guoliang Ma, P. Geo., Manager of Exploration and Resource of the Company, is the Qualified Person for Silvercorp under NI 43-101 and has reviewed and given consent to the technical information contained in this news release.
About Silvercorp
Silvercorp is a profitable Canadian mining company producing silver, lead and zinc metals in concentrates from mines in China. The Company’s goal is to continuously create healthy returns to shareholders through efficient management, organic growth and the acquisition of profitable projects. Silvercorp balances profitability, social and environmental relationships, employees’ wellbeing, and sustainable development. For more information, please visit our website at www.silvercorp.ca.
For further information
Lon Shaver
Vice President
Silvercorp Metals Inc.
Phone: (604) 669-9397
Toll Free: 1 (888) 224-1881
Email: investor@silvercorp.ca
Website: www.silvercorpmetals.com
CAUTIONARY DISCLAIMER – FORWARD LOOKING STATEMENTS
Certain of the statements and information in this press release constitute “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and “forward-looking information” within the meaning of applicable Canadian provincial securities laws. Any statements or information that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as “expects”, “is expected”, “anticipates”, “believes”, “plans”, “projects”, “estimates”, “assumes”, “intends”, “strategies”, “targets”, “goals”, “forecasts”, “objectives”, “budgets”, “schedules”, “potential” or variations thereof or stating that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved, or the negative of any of these terms and similar expressions) are not statements of historical fact and may be forward-looking statements or information. Forward-looking statements or information relate to, among other things: the price of silver and other metals; the accuracy of mineral resource and mineral reserve estimates at the Company’s material properties; the sufficiency of the Company’s capital to finance the Company’s operations; estimates of the Company’s revenues and capital expenditures; estimated production from the Company’s mines in the Ying Mining District; timing of receipt of permits and regulatory approvals; availability of funds from production to finance the Company’s operations; and access to and availability of funding for future construction, use of proceeds from any financing and development of the Company’s properties.
Forward-looking statements or information are subject to a variety of known and unknown risks, uncertainties and other factors that could cause actual events or results to differ from those reflected in the forward-looking statements or information, including, without limitation, social and economic impacts of COVID-19; risks relating to: fluctuating commodity prices; calculation of resources, reserves and mineralization and precious and base metal recovery; interpretations and assumptions of mineral resource and mineral reserve estimates; exploration and development programs; feasibility and engineering reports; permits and licenses; title to properties; property interests; joint venture partners; acquisition of commercially mineable mineral rights; financing; recent market events and conditions; economic factors affecting the Company; timing, estimated amount, capital and operating expenditures and economic returns of future production; integration of future acquisitions into the Company’s existing operations; competition; operations and political conditions; regulatory environment in China and Canada; environmental risks; legislative and regulatory initiatives addressing global climate change or other environmental concerns; foreign exchange rate fluctuations; insurance; risks and hazards of mining operations; key personnel; conflicts of interest; dependence on management; internal control over financial reporting as per the requirements of the Sarbanes-Oxley Act; and bringing actions and enforcing judgments under U.S. securities laws.
This list is not exhaustive of the factors that may affect any of the Company’s forward-looking statements or information. Forward-looking statements or information are statements about the future and are inherently uncertain, and actual achievements of the Company or other future events or conditions may differ materially from those reflected in the forward-looking statements or information due to a variety of risks, uncertainties and other factors, including, without limitation, those referred to in the Company’s Annual Information Form for the year ended March 31, 2021 under the heading “Risk Factors”. Although the Company has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated, described or intended. Accordingly, readers should not place undue reliance on forward-looking statements or information.
The Company’s forward-looking statements and information are based on the assumptions, beliefs, expectations and opinions of management as of the date of this press release, and other than as required by applicable securities laws, the Company does not assume any obligation to update forward-looking statements and information if circumstances or management’s assumptions, beliefs, expectations or opinions should change, or changes in any other events affecting such statements or information. For the reasons set forth above, investors should not place undue reliance on forward-looking statements and information.
CAUTIONARY NOTE TO US INVESTORS
The disclosure in this news release and referred to herein was prepared in accordance with NI 43-101 which differs significantly from the requirements of the U.S. Securities and Exchange Commission (the “SEC”). The terms “proven mineral reserve”, “probable mineral reserve” and “mineral reserves” used in this news release are in reference to the mining terms defined in the Canadian Institute of Mining, Metallurgy and Petroleum Standards (the “CIM Definition Standards”), which definitions have been adopted by NI 43-101. Accordingly, information contained in this news release providing descriptions of our mineral deposits in accordance with NI 43-101 may not be comparable to similar information made public by other U.S. companies subject to the United States federal securities laws and the rules and regulations thereunder.
Investors are cautioned not to assume that any part or all of mineral resources will ever be converted into reserves. Pursuant to CIM Definition Standards, “Inferred mineral resources” are that part of a mineral resource for which quantity and grade or quality are estimated on the basis of limited geological evidence and sampling. Such geological evidence is sufficient to imply but not verify geological and grade or quality continuity. An inferred mineral resource has a lower level of confidence than that applying to an indicated mineral resource and must not be converted to a mineral reserve. However, it is reasonably expected that the majority of inferred mineral resources could be upgraded to indicated mineral resources with continued exploration. Under Canadian rules, estimates of inferred mineral resources may not form the basis of feasibility or pre-feasibility studies, except in rare cases. Investors are cautioned not to assume that all or any part of an inferred mineral resource is economically or legally mineable. Disclosure of “contained ounces” in a resource is permitted disclosure under Canadian regulations; however, the SEC normally only permits issuers to report mineralization that does not constitute “reserves” by SEC standards as in place tonnage and grade without reference to unit measures.
Canadian standards, including the CIM Definition Standards and NI 43-101, differ significantly from standards in the SEC Industry Guide 7. Effective February 25, 2019, the SEC adopted new mining disclosure rules under subpart 1300 of Regulation S-K of the United States Securities Act of 1933, as amended (the “SEC Modernization Rules”), with compliance required for the first fiscal year beginning on or after January 1, 2021. The SEC Modernization Rules replace the historical property disclosure requirements included in SEC Industry Guide 7. As a result of the adoption of the SEC Modernization Rules, the SEC now recognizes estimates of “Measured Mineral Resources”, “Indicated Mineral Resources” and “Inferred Mineral Resources”. In addition, the SEC has amended its definitions of “Proven Mineral Reserves” and “Probable Mineral Reserves” to be substantially similar to corresponding definitions under the CIM Definition Standards. During the period leading up to the compliance date of the SEC Modernization Rules, information regarding mineral resources or reserves contained or referenced in this news release may not be comparable to similar information made public by companies that report according to U.S. standards. While the SEC Modernization Rules are purported to be “substantially similar” to the CIM Definition Standards, readers are cautioned that there are differences between the SEC Modernization Rules and the CIM Definitions Standards. Accordingly, there is no assurance any mineral reserves or mineral resources that the Company may report as “proven mineral reserves”, “probable mineral reserves”, “measured mineral resources”, “indicated mineral resources” and “inferred mineral resources” under NI 43-101 would be the same had the Company prepared the reserve or resource estimates under the standards adopted under the SEC Modernization Rules.
