Drilling Intercepts 1.9 Metres Grading 15 Grams Per Tonne Gold At The New DCG Mine

VANCOUVER, BC - Silvercorp Metals Inc. reported that its first underground drill hole at the DCG Mine in the Ying Mining District, Henan Province, China intercepted a 1.90 meter (m) interval grading 15.0 grams per tonne (g/t) gold (Au).

In 2006, Silvercorp acquired the DCG exploration permit, which is adjacent to the north of the TLP Mine. It covers an area of 19.77 km2. A series of drill programs between 2006 and 2011 of 25 drill holes comprised of 9,026 m focused on obvious lead-zinc veins. A maiden resource estimate that complies with Chinese government requirements, but not NI 43-101, was completed in 2014, and Silvercorp successfully converted the exploration permit to a mining permit in 2015. Information regarding the DCG Mine, including a resource estimate, will be contained in the upcoming NI 43-101 update for the Ying Mining District planned to be released this quarter, currently being prepared by the Company with assistance from AMC Mining Consultants (Canada) Ltd.

In late 2018, the Company decided to develop the DCG Mine and bring it into production. At present, 1,670 m of a 4.2 m wide by 3.8 m high access ramp has been developed and the remaining 95 m should be completed by mid-August 2020, which will allow for mining late this year.

In addition, a 1,756 m transportation ramp is also under development from the TLP Mine camp area to enable ore haulage. So far, 447 m has been completed, with the remaining 1,309 m expected to be completed by the end of April 2021.

Despite the mapping of extensive gold soil geochemical anomalies at the DCG Mine area by the previous owner in 2003, the 2020 underground drill program at the DCG Mine of 8,000 m in 22 holes, like the previous drilling, was focused on extending the previously-identified lead-zinc veins. Three holes have been completed and assay results have been received for one hole.

Previously, only very select intervals with obvious lead-zinc mineralization alteration were sampled for the drill holes from the Ying Mining District. Recently, as potential gold mineralization was identified at the nearby LMW, LME and TLP Mines, the Company has decided to sample the full length of the drill core. As a result, hole ZK03AC702 intercepted a 1.02 m interval from 259.01 to 260.03 m grading 1.5 g/t Au and a 1.90 m interval from 406.86 to 408.76 m grading 15.0 g/t Au (Table 1), with native gold grains observed to be associated with strong silicification, and fine pyrite-ankerite veinlets occurring near the foot wall contact of a diabase dyke with the host Archean gneisses. The gold-bearing diabase contact appears perpendicular to the drill hole orientation, and therefore the 1.90 m interval is believed to be close to true width. The Company was able to make this discovery of gold mineralization only by sampling the full length of the drill core. The extension of this gold discovery will now be the focus of the 2020 drilling program.

Drill cores are NQ size. Drill core samples, limited by apparent mineralization contact or shear/alteration contact, were split into halves by saw cutting. The half cores are stored in the Company's core shacks for future reference and checking, and the other half core samples are shipped in security-sealed bags to the Chengde Huakan 514 Geology and Minerals Test and Research Institute in Chengde, Hebei Province, China, 226 km northeast of Beijing, and the Zhengzhou Nonferrous Exploration Institute Lab in Zhengzhou, Henan Province, China. Both labs are ISO9000 certified analytical labs. For analysis the sample is dried and crushed to minus 1mm and then split to 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 with 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 analyzed by fire assay with AAS finish, and 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 lab batch of samples. QA/QC data at the lab are attached to the assay certificates for each batch of samples.