Scotgold to extend Cononish mine life and aim for mid-tier status

Scotgold Resources Ltd recorded an increase in pre-tax losses but aims to develop Cononish mine into an 18-year operation and build a mid-tier mining company in Scotland.

FINANCES

In its results for the year ended 30 June 2021, the Australian-owned company recorded pre-tax losses of $4,980,942 (June 2020: $2,504,134) with revenue of £299,807.

COMPELLING ECONOMICS

Chief executive Phil Day said that investment in the project had built solid foundations including an increase in the workforce from 38 to 73 with plans for further recruitment.

The company has also optimised the processing plant and mine development plan, arranged an off-take agreement for the high-grade concentrate, focused on de-bottlenecking, improved maintenance practices and planning, and completed the Ball Mill reline. 

Mr Day added that production revenues continued to exceed operational costs with the gold mine hosting world-class ore body.

“It’s exceptionally high-grade with grades running as high as c.20 g/t Au, allowing us to run the processing plant with an average mine feed of c.12 g/t Au to date, which is expected to increase in line with our mine expansion plans.

“As a high margin operation, Cononish has compelling economics with forecast operating costs anticipated at £544/oz AISC, once in full production, which places Cononish in the lowest quartile of gold mining operations globally.”

The company aims to achieve production of circa 23,500oz per annum by Q1 2023.

EXPANSION PLANS

The company has identified three prospective areas close to Cononish as high priority targets with data modelling in progress.

This will establish the best sites to test the targets in any potential future exploration drill programmes.

“It’s our intention to increase our current mine life of 8.5 years and believe there is potential to develop Cononish into a +18-year life of mine operation,” added Mr Day.

“In addition, it’s our strategy to continue to explore our additional licence areas which run across the prospective Grampian area of Scotland – the Caledonides Mobile Belt, with the ultimate vision of building a mid-tier gold mining company in Scotland with multiple operations in the country that enhance the local environment and economy in ways that have an enduring positive impact.

LEASES AND OPTIONS

Scotgold holds a lease (100%) from the Crown Estate Scotland over Cononish Farm in Perth and a lease (100%) from the landowner over Cononish Farm.

The company also holds thirteen Mines Royal Option Agreements (100%) with the Crown Estate Scotland.

During the year, Scotgold Resources Portugal Ltda terminated its 100% interest in the Pomar licence in eastern central Portugal.