Silvercorp Metals Inc.

Silvercorp Metals Inc.

August 02, 2005 09:01 ET

Silvercorp Metals Inc.: Three New Bonanza Grade Veins Intercepted in Tunnels at Ying Silver Project, Henan Province, China

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Aug. 2, 2005) - Silvercorp Metals Inc. ("Silvercorp") (TSX VENTURE:SVM) is pleased to report that underground tunneling at the Ying Silver project has intercepted three new bonanza grade veins, the S4, S7, and S8 with high silver (Ag), lead (Pb) and zinc (Zn) grades in massive galena sheets. Veins S7 and S8 are notable not only for their high grade, but for their length - 3,500 m and 4,500 m long, respectively. This is more than twice the length of any of the previously explored veins S2, S6, S14 S16W and S16E, on which a NI43-101 compliant resource calculation was released in April 2005. These three new veins are expected to warrant an update to the resource calculation upon completion of additional work. Significant results from the three new veins are as follows:

- S4 Vein, being about 550 m long, has been discovered recently to contain massive galena sheets on the 496m elevation by tunnel work through CM103. The best interval returns 2,926 g/t (94.06 oz/t) Ag, 32.96% Pb, and 11.62% Zn over 0.4m width.

- S7 Vein is mapped out over a length of 3,500m. Tunnel work at three locations spreading over 2,100m along strike and a vertical depth of 135m has encountered massive galena sheets. The best interval contains 1,525 g/t (49.04 oz/t) Ag, 22.43% Pb, and 13.64% Zn over 0.44 m width.

- S8 Vein is mapped out over a length of 4,500m. Tunnel work at three locations spread over a strike length of 1,200m and a vertical distance of 135m has intercepted massive galena sheets in each location, with the best interval returning 2,215 g/t (72.8 oz/t) Ag 29.26% Pb, and 9.77% Zn over 1.05 m width, intercepted by main access tunnel CM102.

S4 Vein

The structure of the S4 vein was traced for 550m on surface by several trenches, north of main access tunnel CM103. CM103, on the 550m elevation, intersected the S4 structure in an un-mineralized intercept. At 496 m elevation a massive galena sheet was intercepted by crosscut tunnel and is being followed by drifting along vein. The 14m completed to date has exposed massive galena sheet materials over the 1,250 g/t Ag-equivalent grade cut off for the entire distance.

S7 Vein

The S7 vein is oriented southwest/northeast and, based on surface trenches and limited tunnels, has been mapped out over 3,500m and to a minimum depth of 275 m, dipping northwest. 15 m of drifting has been completed along the vein on the 580 m elevation through access tunnel YPD01 at the YLG camp in the northwest section of S7. A further 116.8 m of drifting has been completed on the central section of the S7 vein through CM102 in the main SGX camp. Mapping
and sampling has also been completed on sections of the S7 vein exposed prior to Silvercorp taking over the project, where local miners drifted 161 m along the vein on the 648m elevation (through SPD01 tunnel at the ZG camp in the southwest part of S7) and drifted 101m on the 705m elevation through CM104 tunnel at the SGX camp). In total, 393.8m of drifting has been completed along the S7 vein on four different elevations. Of this 393.8m, about 254.9m comprises sections of massive galena sheets exceeding the 1,250 g/t Ag-equivalent grade cut-off, yielding a 65% rate of mineralization.

S8 Vein

The S8 vein, which runs parallel to the east of the S7 vein, extends over 4,500m and to a minimum depth of 275m, dipping northwest. The vein has been the subject of mining activity in many sections at different levels to a depth of 150m from surface, starting from the MG camp at the most northeast end to the ZG camp in the southwest. The S8 vein is currently being explored through three access tunnels at the SGX camp: CM101 (640m elevation), and CM102 and CM103 (570m elevation), and through two access tunnels at the YLG camp: YPD02 (565m elevation) and YM01 (585m and 550m elevations). Access tunnel CM102 has just intercepted the S8 vein and intercepted massive galena sheets. Tunnels CM103, CM101 and YPD02 are all being driven southeast and are expected to intersect the S8 vein in a further 305m, 185m and 100m, respectively. To date, out of 374m of drifting completed along the vein and sampled, 197m are massive galena sheet grading over 1,250 g/t Ag-equivalent, representing a 53% rate of mineralization.

Assay results for the S4, S7, and S8 veins are listed in the Table below:

Ele- South Ag Ag
Minera- va- of Equiv. Equiv.
lized tion CM103 Width Ag Ag Pb Zn (g/t) (oz/t)
Veins (m) (m) (m) (g/t) (oz/t) (%) (%) (i) (i)
S4 496 -152 0.30 1238 39.80 34.08 9.64 3134 100.76
496 -147 0.30 1809 58.16 38.11 21.94 4459 143.35
496 -143 0.40 2926 94.06 32.96 11.62 4868 156.51
Weighted Average 0.33 2084 67.01 34.84 14.12 4225 135.84
S7 580 -473 0.44 1525 49.04 22.43 13.64 3119 100.28
570 338 0.50 618 19.86 5.31 10.18 1325 42.60
570 343 0.50 914 29.39 11.11 10.78 1895 60.91
570 394 0.13 582 18.71 29.00 5.20 2053 65.99
570 395 0.20 669 21.51 47.55 2.55 2797 89.91
570 400 0.10 907 29.16 22.45 3.85 2037 65.49
570 405 0.10 617 19.84 12.91 2.25 1269 40.79
570 410 0.75 296 9.52 22.75 6.58 1568 50.42
705 663 0.20 430 13.82 11.85 6.45 1236 39.75
648 1579 0.15 1339 43.05 59.40 13.29 4476 143.92
648 1595 0.30 385 12.38 10.16 30.55 2264 72.79
648 1644 0.35 943 30.32 56.35 9.91 3791 121.89
648 1676 0.25 653 20.99 25.65 11.72 2292 73.68
648 1686 0.30 445 14.31 21.10 14.13 2006 64.50
648 1691 0.25 727 23.37 33.80 21.76 3186 102.44
Weighted Average 0.30 715 22.99 23.72 11.45 2259 72.63
S8 580 -800 0.50 191 6.14 35.56 5.32 1944 62.50
580 -795 1.10 146 4.68 67.04 8.29 3368 108.28
580 -790 0.14 216 6.94 56.54 3.57 2771 89.10
665 -162 0.55 1060 34.08 14.65 8.54 2084 66.99
705 305 0.20 779 25.05 14.30 11.85 1945 62.53
570 400 1.05 2215 79.80 29.26 9.77 3913 128.62
(i) Silver equivalent grade is calculated on the basis of US$6.5/oz Ag,
US$0.40/lb for Pb, and US$0.45/lb for Zn.

Tunnel maps and vein locations are available on the Company's website:

Silvercorp's extensive 2005 exploration and development program for the Ying silver project is well underway. The program includes 13,000m of underground tunneling work, sinking of three vertical shafts to 330m depth, and 10,000m of underground drilling. The program was designed to expand silver resources laterally and to prepare for production once the mining permit is obtained. Based on current success in finding new veins and expanding existing veins, it is expected that by the end of this program, a substantial increase in new resources will be defined on the Ying Project.

Quality Control

The Company has implemented a quality control program to ensure best practice in sampling and analysis of the tunnel samples. Rock samples were collected by channel sampling the face of the undercut drifts. The channels were usually cut 10 cm in width and 5 cm in depth producing a sample weighing approximately 2 kg to 10 kg for each 0.10 to 1.00 m intervals depending on the thickness of mineralization. Drill cores are in NQ size and drill core samples were taken from sawn half core limited by apparent massive galena sheet contact. The samples are shipped directly in security sealed bags to the Langfang Institute of Geochemical and Geophysical Exploration (Certification ISO 9001), a well-regarded analytical laboratory in Langfang, Hebei Province, approximately 60 km from Beijing.

The sample preparation consists of drying, crushing, splitting of the sample to 150 grams, then the sample is pulverized to 200 mesh. Ag, Pb and Zn were analyzed by a 3 hour hot aqua regia digestion on 30 gram samples with an AA finish. Check samples including field duplicates and pulps are routinely sent to ALS Chemex Laboratories in Vancouver, Canada.

Exploration on the Ying Project is carried out through Silvercorp's Sino-foreign joint venture company, Henan Found Mining Co. Ltd. ("Found"), which holds 100% of the Ying Project and in which Silvercorp is earning a 77.5% interest. Myles Gao, P.Geo, President of Silvercorp, is the General Manager of Found. Mr. Gao is also the Qualified Person on the project under NI 43-101.

Statements in this press release other than purely historical information, including statements relating to the Company's future plans and objectives or expected results, constitute forward-looking statements. Forward-looking statements are based on numerous assumptions and are subject to all of the risks and uncertainties inherent in the Company's business, including risks inherent in mineral exploration and development. As a result, actual results may vary materially from those described in the forward-looking statements.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy or this release.

Contact Information

  • Silvercorp Metals Inc.
    Rui Feng
    Chairman & CEO
    (604) 669-9397
    (604) 669-9387 (FAX)
    Silvercorp Metals Inc.
    Cathy Fong
    VP Corporate Development
    (604) 669-9397
    (604) 669-9387 (FAX)