Scotgold just weeks away from first gold pour at Cononish mine in Trossachs park

Scotgold Resources, the company behind the development of a precious metals mine near Tyndrum, has raised millions of pounds as it looks to double production and ramp up its exploration activities.
Scotgold Resources, the company behind the development of a precious metals mine near Tyndrum, has raised millions of pounds as it looks to double production and ramp up its exploration activities. Picture: John DevlinScotgold Resources, the company behind the development of a precious metals mine near Tyndrum, has raised millions of pounds as it looks to double production and ramp up its exploration activities. Picture: John Devlin
Scotgold Resources, the company behind the development of a precious metals mine near Tyndrum, has raised millions of pounds as it looks to double production and ramp up its exploration activities. Picture: John Devlin

The stock market-listed firm said it had raised £3 million before expenses by way of a share placing.

It will use the cash injection to accelerate plans to double production at the Cononish gold and silver mine, which is on course to become Scotland’s first commercial gold mine by the end of November. Funds will also be used to increase exploration activities during 2021.

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Average annual gold equivalent production during phase two of Cononish will rise to 23,500 ounces from 9,910 ounces during phase one. Phase two production is due to commence by May 2022 – 11 months earlier than previously scheduled and 17 months after next month’s initial gold pour.

The firm also pointed to “encouraging” recent results include the identification of gold and silver anomalies to the north east of the Cononish mine and from its Beinn Udlaidh and Inverchorachan prospects.

Chief executive Richard Gray said: “We have an exceptionally exciting few weeks ahead of us as we make final preparations for our first gold pour at Cononish by 30 November.

“As we ramp up production thereafter, the funds raised will allow us to commit to the expenditures required to build on this anticipated momentum and accelerate the phase two expansion project, whilst at the same time maintaining prudent cash reserves.

“With this strong cash balance in place, we have a clear path to realising the significant value that we believe Cononish and our additional prospects offer to investors.”

Last month, the Aim-quoted company said construction work at the Cononish site – which was abandoned in 1997 after gold prices slumped – was progressing well.

That update came as the firm announced that it was beefing up its geoscience team to “unlock the potential” of the area around Cononish as well as in the other areas it is looking to explore at locations including Glen Orchy, Glen Lyon and the Ochils.

In addition to Cononish, Scotgold’s interests include the Grampian exploration project made up of 13 option agreements with the Crown Estate Scotland, across an area of just under 3,000 square kilometres.

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The geoscience team has been expanded with the appointment of Dr Simon Dominy and David Catterall as group manager resources and reserves and exploration consultant respectively. Dominy is a mining geologist and engineer with experience of mines similar to Cononish, which lies within Loch Lomond and the Trossachs National Park.

Catterall is a geologist with more than 30 years’ experience in the sector with expertise in structural mapping and interpretation, geochemistry and geophysics.

Gray said: “The depth of our geological understanding of both Cononish and the Dalradian belt is obviously key to our long-term success and with these appointments, we are building a world-class geoscience team to unlock the fantastic potential of this whole area and our significant land holdings in particular.”

Analysts said the company was on course to bring the Cononish project into production “at what turns up to be the best possible time”.

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Mining firm Scotgold gets back to work at Cononish

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