Scotgold shares soar after hike in reserves

Shares in Scotgold Resources, which is aiming to create Scotland’s first commercial gold mine, surged today after the firm said it could be sitting on treble the amount of precious metal than previously thought.

The firm said an independent mineral resource estimate (MRE), compiled by CSA Global, found there were measured and indicated resources of 248,000 ounces of gold at its Cononish site – an increase of 201 per cent on earlier estimates.

Following the update, Scotgold’s shares jumped more than 55 per cent to 1.05p.

Sign up to our daily newsletter

Work has now started to use 3D geological modelling to assess the best mining methodology for the deposit, which sits within the Loch Lomond and the Trossachs National Park.

Chief executive Richard Gray said: “This MRE released today is truly a cornerstone for the Cononish project and Scotgold Resources.

“In addition to the significant increase in resource ounces, this work done on the 3D modelling in particular will underpin a more robust optimisation of our mining plan. This will be of great value to the board as we look to further optimise the project and make plans for the funding and development of Cononish.”

Gray, the former head of mining and expansion at West Africa-focused gold miner Avocet, succeeded Chris Sangster as Scotgold’s chief executive in October as part of a boardroom overhaul.

But the Aim-quoted company, which is also listed in Australia, parted company with newly-installed chairman Sandy Littlejohn last month after he was unable to take part in a fundraising exercise.