Geology of the Ying Mining District in the west of Henan Province.THERE has been a significant gain in measured and indicated mineral resources at Silvercorp Metals’ Ying silver-lead-zinc mining district in Henan Province. An updated NI 43-101 Technical Report reveals a 52% increase in tonnage and 12% and 8% increases respectively in contained silver and lead resources when compared to the 2012 Technical Report.

The reported resources are 14.01 million measured and indicated tonnes @ 237 grams/tonne silver, 0.10 grams/tonne gold, 3.64% lead and 1.22% zinc for 107.30 million ounces of silver, 43,800 ounces of gold, 512,200 tonnes of lead and 172,600 tonnes of zinc.

The update was prepared by AMC Mining Consultants (Canada) and covers the SGX/HZG, HPG and TLP/LM underground mines on the Ying property. AMC examined all aspects of the project, including drill core, exploration sites, underground workings, processing plant and surface infrastructure.

There are defined reserves of 12.64 million tonnes in the proven and probable categories grading 203 grams/tonne silver, 0.07 grams/tonne gold, 3.01% lead and 1.01% zinc, containing 82.52 million ounces of silver, 29,200 ounces of gold, 380,400 tonnes of lead and 127,200 tonnes of zinc. In comparison with the 2012 Technical Report contained silver in proven and probable reserves is up 5%.

Based on proven and probable reserves only, the Ying mine complex is a viable operation with a projected life of mine (LOM) through to 2030, assuming annual average production of about 6 million ounces of silver from 2014 to 2025, about 3 million ounces from 2026 to 2028 and about 1 million ounces from 2029 to 2030. It also has the potential to extend the LOM beyond 2030, via further exploration and development, particularly in areas of inferred resources.

The results of the 2012-2013 underground drilling program on the Ying property show that most of the major mineralized vein structures are still open at depth and laterally.

During the June quarter Silvercorp produced 1.1 million ounces of silver, 3461 ounces of gold, 11.5 million pounds of lead and 1.2 million pounds of zinc at all Chinese operations, including Ying and the BYP project in Hunan Province, compared to 1.4 million ounces of silver, 3777 ounces of gold, 13.5 million pounds of lead, and 3.7 million pounds of zinc in the corresponding quarter of 2013.

Metal production was positively impacted by improved dilution control, which resulted in a 14% and 23% increase in silver and lead head grades. This was offset by a 20% decrease in ore mined which resulted in overall lower metal production.

Including trial mining production from the developing GC mine in Guangdong Province, total metal production was 1.27 million ounces of silver, 13 million pounds of lead and 3.5 million pounds of zinc.