Scotgold secures £1.18m in funding for Cononish mine

By GARETH MACKIE
Published on 02/07/2012 11:11

MINING firm Scotgold Resources today said it had secured just under £1.2 million in financing to progress with plans to create Scotland’s only commercial gold mine.

The company, headed by chief executive Chris Sangster, said the funds will allow it to continue drilling at its Cononish mine near Tyndrum, which it believes could hold nearly £66m worth of gold. Shares in the company rose 0.25p, or 6.1 per cent, to close at 4.38p.

Under the convertible loan deal, RMB Resources – the merchant banking business of South African financial services group FirstRand – has the option to acquire shares in Scotgold at a cost equal to the value of the loan if all the options are exercised.

Scotgold is seeking about £22m in overall funding for the project and executive chairman John Bentley said the firm hopes to make a final decision on whether to go ahead by January, with development expected to begin in March.