Silvercorp Acquires 70% Interest in the Tulkubash/Kyzyltash Gold Projects, Kyrgyzstan
Aggressive pivot to Central Asia adds massive gold resources but introduces severe jurisdictional risk and significant capital depletion following a parabolic stock rally.
On January 20, 2026, Silvercorp Metals Inc. announced the acquisition of a 70% interest in the Tulkubash and Kyzyltash gold projects in the Kyrgyz Republic for US$162 million in cash. The deal involves purchasing 100% of the shares of Chaarat Gold Holdings Limited, which holds the 70% interest in the projects; the remaining 30% is held by Kyrgyzaltyn OJSC (a state-owned entity) as a free-carried interest. The payment structure includes: - US$92 million to Chaarat Gold Holdings Limited. - US$70 million to the National Investment Agency of the Kyrgyz Republic (US$60M upfront upon waivers, US$10M later). - The deal is conditional on Kyrgyz government waivers regarding pre-emptive rights and the extension of the mining license from 2032 to 2062.
The development plan is split into two phases: - Phase 1 (2026-2028): Development of the Tulkubash oxide gold deposit (heap leach) with a US$150 million capex estimate, targeting ~110,000 oz Au/year. - Phase 2 (2028-2031): Development of the Kyzyltash sulfide deposit (refractory ore requiring BIOX/POX) with a US$400 million capex estimate, targeting ~210,000 oz Au/year.
This news is Material - Game Changer. * Strategic Shift: This marks a definitive shift from a China-centric silver producer to a diversified, multi-jurisdictional gold developer. Following the recent entry into Ecuador (El Domo), this acquisition aggressively expands the asset base into Central Asia. * Resource Addition: The acquisition adds significant gold ounces. Tulkubash holds ~462koz Au (M&I) and Kyzyltash holds ~3.94Moz Au (M&I). This drastically alters the company's reserve profile. * Financial Impact: The US$162 million cash outlay represents approximately 42% of the company's cash balance (reported at ~$381M in Sept 2025). When combined with the estimated US$150M Phase 1 capex and ongoing commitments in Ecuador (El Domo), Silvercorp is rapidly transitioning from a cash-hoarding entity to a capital-intensive developer. * Risk Profile: The risk profile has spiked. Kyrgyzstan has a history of resource nationalism (e.g., the seizure of the Kumtor mine from Centerra Gold). Furthermore, the 30% "free carried" interest for the state partner implies Silvercorp bears 100% of the capital risk for only 70% of the economic upside, a detail that significantly impacts project economics.
- Overview: Silvercorp Metals is a profitable Canadian mining company producing silver, lead, and zinc from mines in China (Ying Mining District and GC Mine). It has recently pivoted to international diversification through the acquisition of the El Domo copper-gold project in Ecuador and now the Tulkubash/Kyzyltash gold projects in Kyrgyzstan.
- Flagship (Cash Cow): The Ying Mining District in Henan Province, China. It is a high-grade, long-life operation that generates the bulk of the company's free cash flow ($83M revenue in Q2 Fiscal 2026).
- Flagship (Growth): The El Domo project in Ecuador (under construction, production targeted 2026) and now Tulkubash in Kyrgyzstan.