Vancouver – Sixteen new veins at Silvercorp Metals (SVM-T) Ying property in Henan province, China, have boosted the deposits resource estimate by 30%.
The main deposit at Ying is the SGX zone, which contains both high-grade and low-grade resources. Exploration delineated four new veins at SGX. The new estimate pegs measured and indicated high-grade resources at 1 million tonnes of 1,232 grams silver per tonne, 21.3% lead, and 7.57% zinc, while the low grade estimate is 799,100 tonnes grading 227 grams silver, 3.71% lead, and 4.04% zinc.
Silvercorp also outlined two new mineralized zones. The HPG zone added eight veins to the project for 248,500 tonnes of 598 grams silver, 1.76% lead, and 0.78% copper indicated resources. The HXG zone added four veins for 201,900 tonnes grading 76 grams silver, 2.15 grams gold per tonne, 3.95% lead, and 0.38% zinc.
In total, measured and indicated resources increased by 30%. Inferred resources also increased by 26% to a total of 3.5 million tonnes containing 72 million oz. silver, 450,700 tonnes lead, 155,400 tonnes zinc, 4,500 tonnes copper, and 68,700 oz. gold.
Mineralization at Ying occurs as multiple quartz-ankerite veins in north-northeast trending fault-fissure zones. Individual veins are typically long but narrow – often a kilometre long but between 40 cm and 1 metre wide.
Silvercorp starting exploring at Ying in August 2004 and have since then completed over 63 km of tunnel, drifts, declines, raises, and shafts as well as over 78 km of underground and surface drilling.
The companys plan at Ying is the reverse of most mining plans rather than defining a reserve via drilling and then starting to mine, Silvercorps motto was to produce first and then use the production cash flow to finance exploration. The company starting mining high-grade silver veins from the moment it received its mining permit at the end of March.
The rush to production has meant that Silvercorp has only had to draw $5 million from the treasury to fund the roughly $25 million spent at Ying. However, without a feasibility study, important figures such as annual production and operating cost are hard to predict.
Silvercorp has also been criticized for allowing the production drive to compromise safety.
In other news, in mid-September Silvercorp declared a dividend of 15 per share. It is the first dividend declaration from Silvercorp, but also the first time a Canadian company has paid dividends to shareholders using profits from a mine in China.