SVM.TO · 2017-01-23 12:00:00

Silvercorp Reports High-Grade Mineralization Zones Revealed BY Its 2016 Exploration Tunneling at the Sgx MINE

Drill Results

NEWS RELEASE

Trading Symbol: TSX: SVM

SILVERCORP REPORTS HIGH-GRADE MINERALIZATION ZONES REVEALED BY ITS 2016

EXPLORATION TUNNELING AT THE SGX MINE, YING MINING DISTRICT, CHINA

VANCOUVER, British Columbia – January 23, 2017 – Silvercorp Metals Inc. ("Silvercorp” or the

“Company”) (TSX:SVM) is pleased to repo rt the results of its 2016 exploration program at the

SGX mine, Ying Mining District, Henan Province, China.

The Company completed 21,358 meters (“m”) underground diamond drilling and 21,886m

exploration tunneling in 2016 at the SGX mine. Results of the underground drilling continuously

extended the major mineralized vein structures along strike and downdip , and the 8,296m drift

tunneling exposed a total of 3,348m of high-grade mineralized zones.

Highlights of selected mineralization zones exposed in exploration drift tunnels:

 Drift Tunnel CM105-S2W2-180-12ANYM exposed mineralization of 155m long and 1.09 m

wide (true width) grading 851 grams per tonne (“g/t”) silver (“Ag”) , 14.59% lead (“Pb”) and

1.98% zinc (“Zn”) within vein structure S2W2 on the 180m level;

 Drift Tunnel CM105-S2W2-180-12ASYM exposed mineralization of 125m long and 0.80m

wide (true width) grading 1,035g/t Ag, 17.60% Pb and 2.78% Zn within vein structure S2W2

on the 180m level; and

 Drift Tunnel PD700-S19-400-9ANYM exposed mineralization of 55m long and 0.81m wide

(true width) grading 1,059g/t Ag, 7.21% Pb and 6.74% Zn within vein structure S19 on the

400m level.

Highlights of selected intersections of drill holes:

 Hole ZK05S1905 intersected a 2.85m interval from 168.94m to 171.79m, 1.48m true width,

of vein S19 grading 571 g/t Ag, 19.16% Pb and 1.04% Zn at the 130m elevation; and

 Hole ZK 14AS2W204 intersected an 1.08m interval from 91.98m to 93.06m, 0.64m true

width, of vein S2 grading 959g/t Ag, 6.7% Pb and 1.38% Zn at the 236m elevation.

Underground diamond holes in the 2016 drilling program were mainly designed to delineate the

downdip and along -strike extensions of known mineralized vein structures in the production

area and test for new veins in the adjacent less-explored areas.

The 2016 drilling program at SGX is briefly summarized in the following table:

Major Target Veins Target

Elevation (m)

Meters

Drilled

Holes

Completed

Holes with

Assay

Received

Holes

Intercepted

Vein

Structures

Holes

Intercepted

Mineralization

S2, S2W2, S7, S7-1, S8,

S14, S16W, S16W1,

S18, S19, S21, S22

-100 to 600 21,538 77 74 77 23

Exploration tunneling, comprising drifting, crosscutting and raising, was driven along and across

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

and splay structures.

The 2016 tunneling program at SGX is briefly summarized in the following table:

Major Target Veins

Target

Levels

(m)

Total

Tunneling

(m)

Channel

Samples

Collected

Drift

Tunneling

Included

(m)

Total Mineralization Exposed by Drift

Tunneling

Length

(m)

Average

True Width

(m)

(g/t)

(%)

S1, S2, S2W2, S7, S7-1,

S8, S14, S16W, S19,

S21, S29, S31, S32

160-710 21,886 5,244 8,296 3,348 0.81 368 6.69 3.16

Tables 1 and 2 below list the assay results of some selected mineralized zones exposed in drift

tunnels and mineralized intersections in drill holes in the 2016 exploration program.

Table 1: Selected mineralized zones exposed by exploration tunneling at the SGX Mine in 2016

Tunnel ID Target

Vein Level (m) Length

(m)

Horizontal

Width (m)

Average

True

Width

(m)

(g/t)

(%)

CM105-S2-180-12ASYM S2 180 50 1.01 1.00 381 12.89 1.04

CM105-S2SJ-S2-180-12ASYM S2 180 105 1.07 1.03 409 8.55 1.66

CM105-S2-220-12SYM S2 220 60 1.25 1.18 214 4.80 1.33

CM105-S2W2-220-12ASYM S2W2 220 35 0.55 0.53 697 9.84 2.66

Combined CM105-S2W2-220-12ANYM S2W2 220 45 0.90 0.80 164 4.59 0.46

CM105-S2W2-220-12ANYM S2W2 220 95 0.72 0.60 731 7.49 4.24

CM105-S2W2-180-12ANYM S2W2 180 155 1.17 1.09 851 14.59 1.98

CM105-S2W2-180-12ASYM S2W2 180 125 0.85 0.80 1,035 17.60 2.78

CM105-S2SJ-S2W2-260-12ANYM S2W2 260 75 1.18 1.08 306 5.59 1.24

PD16-S6-300-10ANYM S6 300 40 0.69 0.68 229 3.04 3.26

CM105-S7-260-8ANYM S7 260 70 1.66 1.60 409 6.54 1.02

CM105-S7-260-14NYM S7 260 80 1.03 1.00 400 4.09 1.21

CM105-S7-branch-300-12SYM S7-branch 300 45 0.97 0.93 317 8.69 0.33

CM102-S7E2-400-SYM S7-1 400 55 0.76 0.75 249 8.45 2.58

XPD-S7-1-260-7SYM S7-1 260 35 0.49 0.39 150 4.83 1.83

CM101-S7-1-350-7SYM S7-1 350 53 0.93 0.89 216 3.68 6.18

PD700-S7-1-400-13ASYM S7-1 400 55 0.83 0.81 212 4.62 5.52

CM101-S7-1-400-NYM S7-1 400 82 0.56 0.55 310 4.45 6.77

CM101-S7-1-400-SYM S7-1 400 45 0.44 0.27 65 1.34 5.69

PD700-S7-1-450-15ASYM S7-1 450 40 0.40 0.38 286 13.18 1.49

CM108-S8-680-0SYM S8 680 75 1.00 0.96 220 3.50 3.66

CM102-S8E-480-2ASYM S8E 480 90 0.95 0.93 235 4.57 5.33

CM102-S8E-520-2SYM S8E 520 70 0.80 0.79 209 7.44 7.77

XPD-S8W-branch-260-13SYM S8W-

branch 260 65 0.47 0.46 245 4.63 1.64

PD16-S14-210-4ANYM S14 210 100 0.84 0.83 498 6.83 1.29

CM101-S16W-380-N1-Sublevel S16E 380 90 0.69 0.68 241 8.45 1.74

XPD-S19-260-7NYM S19 260 53 0.99 0.97 315 6.57 1.46

PD700-S19-400-9ASYM S19 400 85 0.93 0.89 323 8.78 2.31

PD700-S19-400-9ANYM S19 400 55 0.82 0.81 1,059 7.21 6.74

PD700-S19-450-13NYM S19 450 140 0.87 0.86 415 5.1 2.8

PD700-S19-490-9NYM S19 490 105 0.59 0.59 244 3.27 3.74

PD700-S19-530-13ANYM S19 530 100 0.68 0.67 219 3.57 3.91

CM102-S19-534-2ANYM S19 534 60 0.72 0.72 335 3.79 3.24

PD700-S19-570-9ANYM S19 570 60 0.71 0.71 245 2.30 5.23

PD700-S19-570-9NYM S19 570 45 0.67 0.66 253 1.26 3.51

PD700-S19-610-13NYM S19 610 45 0.70 0.69 106 3.38 4.83

XPD-S19W-300-5ASYM S19W 300 50 0.70 0.70 200 7.19 0.48

CM105-S21W-300-10NYM S21W 300 65 0.67 0.65 297 6.57 0.61

PD16-S29-400-51SYM S29 400 50 0.89 0.78 180 2.04 4.78

CM102-S32-520-65SYM S32 520 110 0.86 0.84 141 5.72 8.29

Table 2: Selected drilling results from the 2016 drilling program at the SGX Mine

Hole ID From

(m)

Elevation

(m)

Interval

(m)

True

Width

(m)

(g/t)

(%)

(%) Vein Remarks

ZK127503 12.25 12.86 254 0.61 0.39 31 1.52 1.41 S21W Test*

ZK14AS2W204 91.98 93.06 236 1.08 0.64 959 6.7 1.38 S2 Test

297.03 298.38 89 1.35 0.66 222 0.19 0.26 S2W2 Stepout**

ZK16S2W201 63.79 65.4 270 1.61 1.45 363 0.37 0.28 S2 Stepout

157.77 159.02 223 1.25 1.01 281 5.08 17.8 S2W2 Stepout

166.24 166.99 219 0.75 0.6 29 5.33 1.05 S2W2-

Branch Test

ZK16AS2W202 67.8 69.39 259 1.59 1.11 84 0.04 0.26 S2 Stepout

ZK05S1905 168.94 171.79 130 2.85 1.48 571 19.16 1.04 S19 Stepout

174.25 175.37 125 1.12 0.58 42 3.14 0.82 S19E1 Test

184.81 185.62 117 0.81 0.47 183 3.94 2.14 S19E Test

ZK13S19009 136.65 137.39 359 0.74 0.5 450 4.96 0.75 S19 Test

ZK7AS3002 65.83 66.84 232 1.01 0.67 71 0.92 1.75 S18 Test

ZK13AS19008 29.99 31.67 440 1.68 0.83 354 0.66 0.82 S7-4 Test

ZK11S3002 93.67 94.71 234 1.04 0.63 270 8.12 0.48 S18 Stepout

ZK09S3004 82.44 83.08 212 0.64 0.47 262 3.86 1.06 S18 Stepout

ZK58S16W002 221.25 221.84 82 0.59 0.43 60 12.66 15.52 S19 Test

ZK54S16W001 3.63 4.49 262 0.86 0.39 277 4.63 3.91 S22 Test

ZK09S18005 231.53 232.57 110 1.04 0.66 197 14.9 0.1 S18 Test

ZK15S8004 273.55 274.64 315 1.09 0.81 156 0.99 0.34 S8E Test

ZK17S8002 201.76 202.44 374 0.68 0.53 86 0.85 0.99 S8-Branch Test

ZK18S8003 238.47 239.45 137 0.98 0.59 94 0.12 0.13 S8-Branch Test

ZK10S19002 153 153.82 168 0.82 0.69 407 5.82 5.27 S16W1 Test

ZK0131 233.32 233.97 150 0.65 0.61 120 0.32 7.74 S7-2 Stepout

ZK8AS19002 4.95 6.03 259 1.08 0.31 54 0.83 0.5 S22 Test

136.14 137.37 149 1.23 0.37 51 1.91 0.74 S16W Test

ZK15S8006 251.68 252.3 173 0.62 0.53 510 2.19 1.2 S8 Test

ZK10S19004 7.5 8.12 257 0.62 0.18 204 0.71 1.85 S22 Test

128.09 129.12 147 1.03 0.84 17 1.31 3.9 S16E Test

292.22 295.03 -2 2.81 1.52 149 1.83 0.05 S19 Test

ZK15AS18003 43.64 45.46 617 1.82 1.14 193 2.36 1.09 S19 Test

ZK11AS18001 139.19 140.48 647 1.29 1.09 415 0.48 0.44 S19W1 Test

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

**Test: intersections in open areas without known mineralized intersections nearby.

The exploration results ending June 30, 2016 will be incorporated in a NI43-101 resource update

report expected to be announced in the first quarter of 2017.

The Company has proposed a comprehensive exploration program comprising 23,722m

tunneling and 22,819m underground drilli ng for SGX in 2017 to further trace the striking and

downdip extensions of known vein structures and expand and upgrade the previously defined

mineral resources. The 2017 exploration at the SGX mine will be mainly focused in the current

production area and its adjacent less- or non-explored potential areas.

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 Testing and

Research Institute in Chengde, Hebei Province, China, 226 km northeast of Beijing, a nd the

Zhenzhou Nonferrous Exploration Institute Lab in Zhengzhou, 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 prepar ed 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 chis el 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 comple x 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 200 g sample of minus 160 mesh is prepared for assay. 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 control (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 l ab 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 S tates Private Securities Litigation Reform Act of

1995 and “forward -looking information” within the meaning of applicable Canadian provincial

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

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expressions) are not statements of historical fact and may be forward -looking statements or

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 sufficiency 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 construc tion, use of

proceeds from any financing and development of the Company’s properties.

Forward-looking statements or information are subject to a variety of known and unknown

risks, uncertainties and other factors that could cause actual events or results t o differ from

those reflected in the forward -looking statements or information, including, without limitation,

risks relating to: fluctuating commodity prices; calculation of resources, reserves and

mineralization and precious and base metal recovery; inte rpretations 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 acq uisitions into the Company’s existing operations; competition;

operations and political conditions; regulatory environment 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 statements or information are statements about

the future and are inherently uncertain, and actual achievements of the Company or other

future e vents 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, 2016 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 ant icipated, estimated, described or intended.

Accordingly, readers should not place undue reliance on forward -looking statements 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 laws, 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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