Scotgold Resources Ltd doubled losses while increasing revenue from the start of production at the Cononish gold and silver mine near Tyndrum, Scotland.
FINANCES
The company’s annual results for year ended 30 June 2022 showed total revenues rose to A$17.8 million / £9.9m for 2022 (2021: A$300,000/£166,000)
Loss before taxation increased to A$10.8m / £6m (2021: A$5m / £2.7m), while cash dropped to A$168,000 / £93,000 (2021: A$2.6m / £1.4m)
Scotgold held net debt of A$23.4m / £13m as at 30 June 2022.
The company achieved commercial production on 30 June 2022 after three consecutive months of positive operating cashflow, and continues to target production of c.23,500oz p.a. run rate of gold during 2023.
The number of employees has risen to 96 of which 51 are from Scotland, with company plans to increase the workforce.
OPERATIONS
Scotgold changed the short-term mine schedule in mid-December following a risk assessment which highlighted safety concerns in developing the 430-development level access.
Stoping between the 415-430 level was completed during December, delaying the eventual continuous long-hole stoping methodology required for Phase II of full production levels.
The company said that 430-development level access to expedite continuous stoping in the western areas would continue in 2023.
The change in the short-term mining schedule and harsher than expected weather conditions in December will result in the company’s production forecast for Q4 2022 being 2,000 oz gold (previously 3,000 to 3,500 ounces of gold).
Scotgold added that the change in the short-term mine plan and current adverse weather conditions would only affect Q4 2022 production.
EXPLORATION
Chief executive Phil Day said that Scotgold had made significant progress at Cononish in a year of transformative progress.
“Cononish is an exceptionally high-grade gold underground mining operation with a reserve grade of c.11.9g/t Au and has a current life of mine of 8.5 years with an estimated 555,000 tonnes of ore.
“Whilst we anticipate significant cash generation, especially once full production is achieved during 2023, we are committed to continuing to grow and realise Cononish and Scotgold’s value through exploration.
“Our resource/reserve and life of mine has the potential to be substantially increased within the immediate Cononish mining area, and to this end we have completed very low frequency magnetics to determine a 2023 exploration programme to do this.”
Scotgold holds 13 licences covering 2,900km2 of the Dalradian belt across the Grampian Mountain range.