SVM.TO · 2017-09-05 12:00:00

Silvercorp Reports High-Grade Mineralization Discovery Beneath Current Production Levels Within Major Vein Structures at Hzg, Hpg and Lmw Mines, Ying Mining District, China

Drill Results

NEWS RELEASE

Trading Symbol: TSX: SVM

NYSE AMERICAN: SVM

SILVERCORP REPORTS HIGH-GRADE MINERALIZATION DISCOVERY BENEATH CURRENT

PRODUCTION LEVELS WITHIN MAJOR VEIN STRUCTURES AT HZG, HPG AND LMW MINES,

YING MINING DISTRICT, CHINA

VANCOUVER, British Columbia – September 5, 2017 – Silvercorp Metals Inc. ("Silvercorp” or the

“Company”) (TSX:SVM / NYSE AMERICAN: SVM) is pleased to report results of the first half of its

2017 exploration programs at the HZG, HPG and LMW mines, Ying Mining District, Henan

Province, China.

In the first half of 2017, t he Company completed a total of 21,675 meters (“m”) of underground

diamond drilling and 7,989m of exploration tunneling at HZG, HPG and LMW mines. Exploration

tunneling exposed significant high-grade mineralized zones beneath the current production

levels within major production veins, especially HZ20 at the HZG mine and H17 at the HPG mine.

Underground drilling continuously extended the major mineralized vein structures along strike

and downdip at the three mines.

Highlights of selected mineralized zones exposed in exploration drift tunnels:

 Drift Tunnel PD820-HZ20-600-133-SYM exposed mineralization of 66m long and 1.21m

wide (true width) grading 1,389 grams per tonne (“g/t”) silver (“Ag”) , 0.40% lead (“Pb”),

0.67% zinc (“Zn”) and 2.78% copper (“Cu”) within vein structure HZ20 on the 600m level at

HZG mine;

 Drift Tunnel PD3 -H17-251-10NYM exposed mineralization of 61m long and 1.53m wide

(true width) grading 66g/t Ag, 5.41% Pb, 2.59% Zn and 1.13g/t gold (“Au”) within vein H17

on the 251m level at HPG mine; and

 Drift Tunnel XPDN -LM19W1-700-3NYM exposed mineral ization of 80m long and 1.01m

wide (true width) grading 514g/t Ag, 3.22% Pb and 0.86% Zn with in vein structure LM19W1

on the 700m level at LMW mine.

Highlights of selected intersections of drill holes:

 Hole ZK11905 at HZG mine intersected an 1.60m interval from 185.73m to 187.33m, 0.91m

true width, of vein HZ20 grading 999g/t Ag, 1.84% Pb, 0.38% Zn and 1.12% Cu at the 761m

elevation;

 Hole ZKX116F03 at LMW mine intersected a 0.95m interval from 60.92m to 61.87m, 0.82m

true width, of vein LM33 grading 1,174g/t Ag, 8.34% Pb and 0.78% Zn at the 583m elevation;

and

 Hole ZKX107N01 at LMW mine intersected a 3.13m interval from 464.55m to 467.68m,

2.17m true width, of vein LM14 grading 279g/t Ag, 1.55% Pb and 0.06% Zn at the 519m

elevation.

Diamond drill holes are designed to define and upgrade inferred mineral resource blocks and

test for new mineral resources. Underground drilling is mainly conducted from current

production lev els to delineate the downdip and along-strike extensions of known mineralized

vein structures in the production area and test for new veins in the previous less-explored areas.

The first half of 2017 drilling programs at HZG, HPG and LMW mines are briefly summarized in

the following table:

Major Target Veins Meters

Drilled

Holes

Completed

Samples

Collected

Holes with

Assay

Received*

Holes

Intercepted Vein

Structures

Holes

Intercepted

Mineralization

LMW Mine

LM12, LM13, LM14,

LM19, LM19W1, LM19W2,

LM30W

9,622 28 515 35 35 19

HPG Mine

H12, H21, H29 7,310 23 245 23 23 12

HZG Mine

HZ10, HZ11, HZ20, HZ22 4,743 15 255 18 18 7

*Including holes drilled in late 2016.

The 2017 e xploration tunneling, comprising drifting, crosscutting and r aising, was driven along

and across major mineralized vein structures to upgrade drill defined mineral resources and test

for new parallel and splay structures.

The first half of 2017 tunneling programs at HZG, HPG and LMW mines are briefly summarized in

the following table:

Major Target Veins

Total

Tunneling

(m)

Channel

Samples

Collected

Drift

Tunneling

Included

(m)

Total Mineralization Exposed by Drift Tunneling

Length

(m)

Average

True

Width (m)

(g/t)

(%)

(g/t)

HPG Mine

H5, H12E, H13, H15, H17 2,254 702 1,207 347 1.22 70 4.63 2.46 0.94

HZG Mine Cu

(%)

HZ20, HZ22, HZ22W, HZ23,

HZ26, HZ27 1,956 686 995 473 0.73 681 1.47 0.36 1.12

LMW Mine

LM7, LM8_4, LM12_1, LM14,

LM14_2, LM16, LM17, LM19W1,

LM19W2, LM31, T24, T27E

3,779 1,059 2,232 415 0.70 296 4.61 0.32

Tables 1 and 2 below list assay results of some selected mineralized intersections in drill holes

and mineralized zones exposed in drift tunnels in the first half of 2017 exploration programs.

Table 1: Selected drilling results from the 2017 drilling programs at HZG, HPG and LMW mines

Hole ID From

(m) To (m) Elevation

(m)

Interval

(m)

True

Width

(m)

(g/t)

(%)

(%) Vein Remarks

HZG Mine Cu

(%)

ZK14902 56.83 57.24 595 0.41 0.16 95 3.07 0.32 0.11 HZ22E Test*

ZK11905 181.46 181.98 762 0.53 0.30 144 0.26 0.13 0.16 HZ20Branch Test

185.73 187.33 761 1.60 0.91 999 1.84 0.38 1.12 HZ20 Test

ZK15108 280.84 282.08 370 1.24 0.67 372 0.44 0.13 0.16 HZ20 Test

283.80 284.24 367 0.44 0.23 127 0.13 0.47 0.58 HZ20W-Branch Test

ZK11702 258.85 259.15 739 0.31 0.23 437 0.30 0.12 0.66 HZ20 Test

ZK11507 252.83 254.39 767 1.56 1.35 223 1.20 0.22 0.50 HZ20 Test

ZK4309 254.19 254.86 505 0.67 0.64 72 1.07 0.53 0.54 HZ22E Test

354.55 356.44 450 1.89 1.63 279 0.10 0.06 0.09 HZ26 Test

HPG Mine

(g/t)

ZK3106 178.33 179.09 516 0.76 0.46 20 8.43 2.45 0.05 H12W Test

ZK2909 3.25 7.88 626 4.63 1.40 24 0.20 0.01 1.63 H12E Infill**

10.31 10.71 621 0.40 0.22 40 2.95 0.16 1.19 H12E_Branch Test

ZK1213 163.12 163.74 602 0.62 0.30 6 1.30 0.03 1.54 H18_1 Test

ZK2709 122.72 123.12 528 0.40 0.24 51 6.05 0.09 0.03 H12E2 Test

ZK3615 201.15 202.24 501 1.09 0.82 4 0.05 0.01 2.13 H21 Stepout***

ZK3107 3.08 4.99 626 1.91 0.67 6 0.06 0.01 2.04 H12E Infill

ZK3107 224.15 228.30 445 4.15 2.20 22 4.30 0.28 0.05 H12 Stepout

ZK4101 105.00 105.48 588 0.48 0.40 24 1.54 1.30 0.28 H12E1 Test

231.22 231.56 537 0.34 0.31 52 1.75 0.92 0.99 H12E Test

ZK4102 271.37 272.15 456 0.78 0.64 45 1.95 1.22 0.53 H12E Test

ZK2530 303.72 305.13 444 1.41 0.94 17 0.14 0.12 1.92 H29 Test

ZK3901 102.88 103.60 579 0.72 0.47 17 0.44 0.29 1.72 H12E1 Test

251.28 251.76 511 0.48 0.36 139 8.31 0.72 0.13 H12E Test

ZK3903 83.24 83.85 562 0.61 0.29 27 4.07 1.92 0.16 H12 Test

LMW Mine ZKX130W01 150.80 151.49 863 0.69 0.69 186 0.26 0.43 LM8_5 Test

ZKX107N01 464.55 467.68 519 3.13 2.17 279 1.55 0.06 LM14 Stepout

ZKX109N01 499.27 499.72 472 0.45 0.24 69 3.85 0.66 LM14 Stepout

ZKX103N04 390.39 392.54 407 2.15 1.27 106 1.08 0.11 LM14 Test

ZKX100N01 245.07 246.70 512 1.63 0.93 195 0.34 0.05 LM14 Test

ZKX02Q00 244.05 248.27 823 4.22 3.67 146 3.93 0.14 LM17 Test

ZKX13063 140.42 143.14 784 2.72 1.88 290 0.33 0.15 LM19 Test

ZKX12261 183.45 183.71 803 0.26 0.18 96 2.17 0.18 LM19 Test

ZKX107N01 117.73 119.58 726 1.85 1.18 225 0.31 0.09 LM19W3 Test

ZKX11651 100.51 101.27 537 0.76 0.68 99 12.02 0.05 LM32E Test

ZKX116F03 60.92 61.87 583 0.95 0.82 1,174 8.34 0.78 LM33 Test

ZKX120F01 77.14 77.95 562 0.81 0.58 645 2.58 0.56 LM33 Test

*Test: intersections in open areas without known mineralization for new resource delineation

**Infill: intersections within known resource blocks for resource upgrade

***Stepout: intersections adjacent to existing resource blocks for resource expansion

Table 2: Selected mineralized zones exposed by drift tunneling at HZG, HPG and LMW mines

Tunnel ID Vein Level

(m)

Length

(m)

True

Width (m)

（g/t)

（%）

HZG Mine Cu (%)

PD820-HZ20-650-123-NYM HZ20 650 30 0.45 1,865 0.51 0.54 3.32

PD820-HZ20-600-133-SYM HZ20 600 66 1.21 1,389 0.40 0.67 2.78

PD820-HZ20-600-133-NYM HZ20 600 48 0.70 553 0.27 0.42 1.75

PD820-HZ20-550-133-SNYM HZ20 550 20 0.67 320 0.22 0.78 1.32

PD820-HZ22-770-N1-SNYM HZ22 770 25 0.81 873 0.60 0.23 0.62

PD810-HZ22-700-49-NYM HZ22 700 60 0.59 172 1.62 0.22 0.33

PD810-HZ22W-700-47A-SYM HZ22W 700 20 0.33 95 6.28 0.11 0.12

PD820-HZ23-650-47A-SYM HZ23 650 95 0.91 474 2.86 0.14 0.21

PD810-HZ27-700-47A-NYM HZ27 700 30 0.50 390 1.40 0.24 0.20

HPG Mine Au (g/t)

PD2-H17-580-4NYM H17 580 55 0.91 31 4.35 0.04 0.26

PD3-H17-310-32NYM H17 310 24 2.27 162 10.79 3.02 1.40

PD3-H17-251-10NYM H17 251 61 1.53 66 5.44 2.59 1.13

PD3-H17-200-12NYM H17 200 50 0.82 63 3.42 0.33 0.58

PD3-H17-150-10NYM H17 150 102 1.55 48 2.90 3.77 0.94

LMW Mine

XPDS-LM17-770-26SYM LM17 770 50 0.78 115 1.97 0.18

XPDS-LM17-675-26SYM LM17 675 25 0.74 83 1.53 0.06

XPDN-LM19W1-700-3NYM LM19W1 700 80 1.01 514 3.22 0.86

SJ969-LM19W2-600-120NYM LM19W2 600 35 0.47 41 4.92 0.12

SJ969-LM19W2-500-114SYM LM19W2 500 20 1.05 369 3.71 0.29

PD969SJ-LM31-550-114SNYM LM31 550 20 0.36 291 6.92 0.21

PD969SJ-LM31-550-114NYM LM31 550 40 0.46 230 6.56 0.06

PD924-T27E-924-112SYM T27E 924 45 0.84 194 4.48 0.38

Quality Control

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 ot her 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, a nd the

Zhenzhou Nonferrous Exploration Institute Lab in Zh engzhou, Henan Province, China, and both

labs are ISO9000 certified analytical lab. For analysis the sample is dried and crushed to minus

1mm and then split to a 200 -300g 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 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 5m along strike.

Both the mineralized vein and the altered wall rocks are cut with continuous chisel chipping.

Sample length ranges from 0.2m to more than 1m, 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 service. The channel samples are

dried, crushed and pulverized. A 200g sample of minus 160 mesh is prepared for a ssay. A

duplicate sample of minus 1mm is made and kept at the laboratory archives. Gold is analysed 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 cont rol (QA/QC) procedure is adopted to monitor the

analytical quality at the 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.

The Company maintains its own comprehensive QA/QC program to ensure best practice s in

sample preparation and analysis of the exploration samples. Project geologists regularly insert

CRM, field duplicates and blanks to each batch of 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 about 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.

Ruijin Jiang, P. Geo , reviewed the exploration data and prepared t he scientific and technical

information regarding exploration results contained herein . Alex Zhang, P. Geo, VP exploration

of the Company, is the Qualified Person on the project as defined under National Instrument 43-

101 and he has verified and approved the contents of this news release.

About Silvercorp

Silvercorp is a low-cost silver-producing Canadian mining company with multiple mines in China.

The Company’s vision is to deliver shareholder value by focusing on the acquisition of under

developed projects with resource potential and the ability to grow organically. For more

information, please visit our website at www.silvercorp.ca.

For further information

Gordon Neal

Vice President, Corporate Development

Silvercorp Metals Inc.

Phone: (604) 669-9397

Toll Free: 1(888) 224-1881

Email: [email protected]

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 applica ble Canadian provincial

securities laws. Any statements or information that express or involve discussions with respect

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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 sufficie ncy 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 in formation 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,

risks r elating 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 an d 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 envir onment in China and Canada;

environmental risks; 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 statem ents 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, 2017 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 s tatements 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 l aws, 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.

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