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(Kitco News) Silvercorp Metals is using its low-cost silver operations in China to support a broader growth plan in Ecuador and Kyrgyzstan, while pursuing a Hong Kong listing aimed at expanding its investor base.
The strategy comes as silver prices remain volatile but historically strong. Speaking with Kitco Mining on June 30, Silvercorp President Lon Shaver said the metal’s recent pullback should be viewed against the scale of the rally that preceded it.
“We’re only talking about silver at $60 because it was peaking out at $120,” Shaver said.
Shaver said near-term silver moves have been influenced by market liquidity, speculative flows and broader commodity volatility, while longer-term demand remains supported by precious metals buying and industrial uses tied to electrification.
“This is a great time to be a silver producer at $60 silver,” Shaver said.
For Silvercorp, the price environment is important as its existing operations are generating the financial base for a larger development pipeline, according to Shaver. The company produced 6.8 million ounces of silver and about 9,000 ounces of gold in fiscal 2026, or 7.5 million ounces silver equivalent. The fiscal year ended March 31. All-in sustaining cost was $14.25 per ounce.
The company’s operating base remains centered on China, where Silvercorp owns the Ying Mining District and GC mine. On June 29, the company said it would experience a temporary slowdown at both operations as it implements new safety systems under nationwide mine safety requirements in China.
The measures followed a fatal coal mine accident in Shanxi Province in late May and a broader regulatory review across China’s mining industry. Silvercorp said production at Ying is expected to be affected by 40% to 50% during the July-September quarter, while production at GC is expected to be affected by about 50% over the same period. Production in the current quarter is expected to be affected by 10% to 15%.
Silvercorp said work to complete required safety systems at non-compliant mining levels is expected to cost about $5.5 million and take about 50 days. Additional facility improvements and equipment upgrades are expected to cost another $6 million. The company said Chinese authorities have adopted a phased approval process that allows production to resume at individual mining levels once work is completed and inspected.
The June 29 update adds context to Silvercorp’s push to broaden its operating base. Shaver said the China mines have generated strong returns and still have a long future, but he said the company’s profile has sometimes been difficult for Western investors to assess.
“We’ve been a bit of an unusual company in the Western markets for being a Canadian company with these interests in these Chinese silver mines,” he said.
Shaver said Silvercorp’s strategy is to add assets in other jurisdictions, reduce single-country concentration and create a larger company that can attract a broader investor audience.
The most advanced growth project is El Domo in Ecuador, which is under construction. Shaver said the project has an estimated capital cost of $284 million, with $160 million expected to be spent in the current fiscal year. The company had spent $45 million as of the end of March.
Wheaton, which holds a stream on El Domo’s gold and silver, is expected to contribute $175 million of the $284 million capital budget. Shaver said the project will be funded through cash on hand and Wheaton’s contribution.
Silvercorp is also advancing the Condor project in Ecuador. Shaver said spending will remain relatively limited while the company moves the asset through exploration and feasibility work, but he said Silvercorp expects to start work this fall on two tunnels into the deposit. The work is expected to cost about $15 million.
In Kyrgyzstan, Silvercorp is planning a two-phase development of the Tulukbash and Kyzyl Tash gold projects. Tulukbash is the first phase, with a construction budget of just over $160 million. Shaver said the company is targeting ore on pads in late 2027 and first gold in 2028.
Kyzyl Tash would follow as a larger second phase. Shaver noted that the plan is to use cash flow from Tulukbash to help fund construction of the larger project.
The combined pipeline could materially change Silvercorp’s scale. Shaver said the company’s China operations could generate roughly $450 million to $500 million in revenue a few years out, depending on metal prices. As projects in Ecuador and Kyrgyzstan are added, he said revenue could move above $2.2 billion around 2030 or 2031.
The growth plan is also tied to Silvercorp’s capital markets strategy. Shaver said the company is pursuing a Hong Kong listing to reach investors who may be more familiar with China, precious metals and emerging-market mining exposure.
He said the company is considering a fundraising connected to the listing, although the size has not been finalized. “It’s still to be determined, but I think somewhere in the $200 million range would be a balance,” Shaver said.
Shaver said the goal is to provide enough stock to support trading liquidity in Hong Kong without raising more capital than needed at current prices.
Silvercorp has also added Chinese debt financing to support its growth plans. Asked about the company’s April three-year loan agreement for 1.5 billion renminbi, or about $220 million, Shaver said the structure allows Silvercorp to borrow RMB outside China, convert the funds to U.S. dollars and use them in Vancouver, Ecuador, Kyrgyzstan or elsewhere, while repaying the loan in the currency generated by its Chinese operations.
The company’s diversification push is also intended to address valuation. Shaver said investors can accept jurisdictional risk, but concentration in a single asset or country can weigh on valuation.
“The markets can accept risk and can accept being in some of these riskier jurisdictions,” Shaver said. “But ideally, it’s not the only asset you have.”
Shaver said Silvercorp is not trying to become an overly complex company with operations spread across too many jurisdictions. Instead, he said the company is focused on adding assets that can be built, brought into production, and contribute to a broader re-rating.
The company is also keeping its merger-and-acquisition review process active. Shaver said Silvercorp’s development pipeline is full, but the company continues to evaluate opportunities so it is ready if market conditions change. He also said Silvercorp’s strategic investment in New Pacific Metals could lead to a future transaction if it made sense for both companies and their shareholders.
Near-term catalysts include construction progress at El Domo, initial work at Condor, and development activity in Kyrgyzstan. Shaver said Kyrgyzstan may be one of the more important updates for investors because Silvercorp acquired projects that are further advanced than some market participants may realize.
“People didn’t realize that we’ve bought something that’s ready to go and we’re going to be spending meaningful dollars this year in 2026 to start construction of the first phase,” Shaver said.
Silvercorp’s next phase will depend on execution across several fronts: completing required safety upgrades in China, advancing El Domo toward operations, beginning meaningful work in Kyrgyzstan and testing whether a Hong Kong listing can broaden the company’s investor base. Shaver said the goal is to move Silvercorp from a China-centered silver producer into a larger, multi-asset precious metals company with broader market appeal.
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This article/video was produced with support from a Kitco sponsor. The views expressed in this content do not necessarily reflect the views of Kitco Metals Inc. Kitco does not endorse or recommend any company, security, investment product, or investment strategy. This content is for informational purposes only and should not be considered investment advice.
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