Silvercorp Metals To Acquire Zhonghe Silver Project In China

VANCOUVER - Silvercorp Metals Inc. reported that its subsidiary, Henan Found Mining Co. Ltd., won an auction to acquire the exploration rights to the Zhonghe Silver Project from the Henan provincial government. The Company received confirmation of its successful bid. The Zhonghe Project covers an area of 4.96 square kilometers (km) approximately 50 km (75 km by road) northeast of Silvercorp’s Ying Mining District, also located in Luoning County. Silver-lead-zinc mineralization at the Zhonghe Project is similar to that found at the SGX Mine in the Ying Mining District.

The Company will utilize Henan Found’s existing management team at the Ying Mining District to manage the future development of Zhonghe. As the largest taxpayer in Luoning County, Henan Found has established a good working relationship with the Luoning government, has an excellent reputation within the local community, and intends to bring in the local government and community as 8% - 10% partners on the project. The Company expects full support from the local government and community in the future, converting the exploration right to a mining license and developing operations at the Zhonghe Project.

The exploration right comprising the Zhonghe Project is located in Dongshong Township of Luoning County and covers an area of 4.9 km², being approximately 1.1 km wide (east-west) by 4.9 km long (north-south). From March 2016 to August 2019, the Department of Natural Resources of Henan Province completed 3,213 m³ of trenching and 36,091 m of diamond drilling in 54 diamond drill holes that defined silver-lead-zinc vein structures extending over 4.9 km long, and from surface at 640 m elevation down to minus 450 m elevation, dipping to the west at an average of 70 degrees.

Based on the drill grid spacing of 175 m to 223 m along strike and 162 m to 272 m down dip, mineral resources for silver, lead and zinc estimated using Chinese standards (not NI 43-101 compliant) were calculated by the No 1 Institute of Geological and Mineral Resource Survey in Henan Province in 2019.