Silvercorp Metals Inc. has agreed to pay $15 million to acquire Silvertip, a silver-lead-zinc project in British Columbia that's presently owned by Silver Standard Resources Inc.

The company said up to 50 per cent of the project will be paid in common shares of Silvercorp while the rest will be in cash. Silvertip underwent preliminary testing in 1998, which showed a lead concentrate grade of 65 per cent, silver recoveries of 69.2 per cent, and lead recoveries of 80.4 per cent.

The company said it plans to perform an additional mineralogy study and a metallurgical test program on the property, as well as expand into a regional exploration program outside the current resource area.

"We will apply the same successful strategy we used at our Ying mine in China to the Silvertip project, with a focus on commencing small scale production at the earliest possible date," said president and CEO Rui Feng in a release.

He added that the company would use the cash flow generated from the operations to fund further expansion.

The company hopes to close the acquisition by Feb. 26.

Silvercorp shares were up five cents to $6.82 on the Toronto Stock Exchange.