Silvercorp Provides Operation Update for Ying Mining District
VANCOUVER, BRITISH COLUMBIA -- (Marketwired) -- 09/12/13 --
Silvercorp Metals Inc. (TSX:SVM)(NYSE:SVM) ("Silvercorp" or the
"Company") today provides a production update for the Ying Mining
In light of the significant decline in precious metal prices over the
last several months, as previously announced the company has been
reviewing its operations to identify any potential cost saving
measures to better adapt to the new price environment. One of the
review's key findings is that dilutive practices of mining
contractors for ore production at Ying Mining District has
contributed to head grade decline as reported in the previous two
quarterly financial reports.
The mining contractors at the Ying Mining Camps are paid based on
tonnes of ore mined. To determine the amount of ore mined, ore-trucks
were scale weighed at the gates of each tunnel. This review has
revealed that some mining contractors however were blending waste
rock from development tunnels with the ore to obtain higher mining
fees, resulting in dilution of ores and reduction of head grades.
This also caused an increase in operating costs as waste tonnage was
shipped and milled.
The Company has taken immediate remedial action by modifying the
method of calculating the actual amount of ore mined by contractors
(the "New Method"). The New Method uses assayed grade to determine
ore/waste contact and measured length, width, and height of ore
bodies in each mining stope mined during the month plus allowed
mining dilution (from 10% to 30%) to calculate the amount of ore to
be extracted by the contractors. The ore will continue to be scale
weighed at the gates of the tunnels, but only as a reference.
In August 2013, the Company ordered the contractors to implement the
New Method. As a result silver and lead head grades at the SGX mine
improved by almost 35% and 21% respectively with an approximate 45%
reduction in ore production (a 25% reduction in overall silver metal
production) compared to July 2013. The New Method has eliminated
significant waste rock resulting in less ore being produced.
Additionally, some drillers and miners left the mine sites as they
feel that under the New Method their pay would be uncertain, which
also caused reduced ore production.
During this transition period the Company expects that ore production
with improved head grades may remain at a reduced level for one to
two more quarters as the Company is fully implementing the New
Method. The Company believes that this will lead to long term cost
savings and improved head grades.
Myles Gao, P.Geo., President, is the Qualified Person for Silvercorp
under NI 43-101 and has reviewed and given consent to the technical
information contained in this News Release.
Silvercorp is a low-cost silver-producing Canadian mining company
with multiple mines in China which has paid a cash dividend since
2007. The Company is currently developing the GC project in southern
China which it expects will become its next operating mine. The
Company's vision is to deliver shareholder value by focusing on the
acquisition of small-scale projects with resource potential and
self-fund the growth of those assets. For more information, please
visit our website at www.silvercorp.ca.
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 applicable
Canadian provincial securities laws. Any statements or information
that express or involve discussions with respect to predictions,
expectations, beliefs, plans, projections, objectives, assumptions or
future events or performance (often, but not always, using words or
phrases such as "expects", "is expected", "anticipates", "believes",
"plans", "projects", "estimates", "assumes", "intends", "strategies",
"targets", "goals", "forecasts", "objectives", "budgets",
"schedules", "potential" or variations thereof or stating that
certain actions, events or results "may", "could", "would", "might"
or "will" be taken, occur or be achieved, or the negative of any of
these terms and similar 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 Camp; 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 information 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 relating 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 and licenses;
title to properties; First Nations title claims and rights; 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 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 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, 2012 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 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
Silvercorp Metals Inc.
(604) 669-9397 or Toll Free: 1 (888) 224-1881
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