Other Routine +

Silvercorp Announces the Construction Plan and Schedule for the Development of the Chaarat ZAAV Project

Silvercorp’s Kyrgyzstan joint venture execution advances despite budget creep and schedule slips testing management’s capital discipline.

By The Northwire Desk — AI Analysis Jun 22, 2026 · 07:00 SVM · 15.8 Silvercorp Metals Inc.

Executive Summary

Silvercorp announced a US$196.3 million capital budget for the Chaarat ZAAV Project in the Kyrgyz Republic, covering Phase 1 (Tulkubash) and initial Phase 2 (Kyzyltash) development.
Phase 1 budget totals $166.3 million ($42.3M in 2026, $124.0M in 2027) to build a 4 million tonnes/year open-pit/heap leach operation for oxidized ore.
Phase 2 budget totals $30.0 million ($15.0M in 2026, $15.0M in 2027) for infill drilling, economic studies (PEA, PFS, Feasibility), and detailed engineering, with construction targeted to commence in 2028.
The company plans 50,000–60,000 metres of infill/step-out drilling in 2026 to convert inferred resources to measured & indicated categories.
An updated feasibility study by LogiProc is expected by July 2026. BGRIMM of Beijing is redesigning the crusher and ADR plant to meet Kyrgyzstan standards, with final completion in March 2027.
ZAAV operates as a 70/30 joint venture with Silvercorp as operator and Kyrgyzaltyn holding a 30% free-carried interest. The mining license has been extended to June 2062.

Material Impact

This is a routine development update that confirms capital deployment for a major strategic acquisition. The $196.3M budget is fully funded by existing cash ($422.3M) and operating cash flow, requiring no new debt or dilution.
The budget increase from the initial $150M commitment and the shift of construction to 2028 are expected for a greenfield/brownfield project in a new jurisdiction requiring local engineering adaptation. It does not alter the long-term thesis but introduces near-term capital intensity and timeline risk.
The market's recent price action (pullback from $21.52 to ~$15.80) suggests investors are discounting execution risk and jurisdictional uncertainty rather than reacting to this specific update.

SVM · Price

Company Overview

China (Operating & Development): Ying Mining District (Ag-Pb-Zn-Au) and GC Mine (Ag-Pb-Zn) are the cash flow engines. Kuanping satellite mine is under construction, targeting initial production in Q1 FY2027.
Ecuador (Development): El Domo (Cu-Au) is under construction with a $284M budget, targeting July 2027 production. Condor (Au-Ag-Zn-Pb) has a PEA showing strong economics ($522M NPV, 29% IRR).
Kyrgyzstan (Development): Chaarat ZAAV JV (70% owned) holds the Tulkubash and Kyzyltash gold projects, with a license extended to 2062.
Indirect Exposure: 28% stake in Auro Metals (Santa Barbara, Ecuador) and 28% in New Pacific Metals (Silver Sand, Bolivia).

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