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Friday, 7 June 2013
Silvercorp Metals says latest LM mine results show potential to expand reserves
China-focused silver miner Silvercorp Metals (TSE:SVM)(NYSE:SVM) has released more underground exploration results from the program that took place last year at its LM Mine in China's Ying Mining District, saying the new results show good consistency and the potential to expand reserves.
The results released Friday are from the underground tunneling program in 2012, as well as from the diamond drilling campaign in the second half of last year. The whole campaign was designed to upgrade existing resource blocks below the current mining depth, extend known zones and explore for new zones along the major producing veins.
Of the underground tunneling results, highlights include a zone of 147 metres in legnth and 0.84 metres in true width, grading 858 grams per tonne (g/t) silver, 2.11% lead and 0.43% zinc. The drift was along vein LM5 on the 750 metre level, the company said in its release.
Diamond drill results meanwhile include an intercept of 1.44 metres grading 1,872 g/t silver, 3.56% lead and 0.41% zinc, as well as an 1.81 metre intercept grading 2,649 g/t silver, 1.88% lead and 0.63% zinc.
Silvercorp said Friday the new results show "good downdip and along strike consistency" in relation to existing production veins at the mine, as well as the potential to expand the current reserves and resources when incorporated into the next update for the Ying district.
The company added that the major vein structures are still open along strike and downdip.
Indeed, more than 5,000 metres of diamond drilling was completed in the second half of 2012, and 14 of the 23 holes intersected high-grade mineralization, according to Silvercorp's statement, which resulted in the finding of new mineralization in the upper portions of major production veins.
This year, the miner will focus on upgrading and expanding resource blocks along major mineralized vein structures using existing underground infrastructure to access these veins. Currently, a program including 5,100 metres of underground tunneling and 24,100 metres of diamond drilling is underway.
Earlier this week, Silvercorp unveiled underground exploration results from its SGX mine in the Ying district, also saying it is continuing to focus on upgrading and expanding resource blocks on major mineralized veins.
The company, which has several mines in China and is developing its GC project that is expected to become its next operating mine this year, in late May re-negotiated contracts with eight mining contractors at its operations in China's Ying Mining District, with updated fees to reflect the change in its mining strategy, which increases the use of "the lower cost shrinkage method" to 75 per cent and reduces the use of the higher cost re-suing method to 25 per cent for expected ore production of 900,000 tonnes in fiscal 2014.
The new contracts are expected to reduce total mining costs and increase mine life in the long term in the effort to combat increased labour costs in China. The new strategy is also expected to take the company to up to a mining rate of 3,200 tonnes per day