argyll news

National Park Authority to approve Cononish Gold Mine operation:

What a difference a year makes.

In August 2010, the Park Authority for Loch Lomond and the Trossachs National Park, much of which is in Argyll, took what was generally regarded as an unthinkingly negative stance on an application to reopen the gold mine above Cononish Farm west of Tyndrum.

The Authority had accepted the recommendation of its Director of Planning – the Park is its own planning authority – that Scotgold Resources’ application to reopen the mine should be rejected.

The reason given was the impossibility of reconciling economic benefit with conservation needs – even though the mine is on the very fringes of the National Park.

Over the past twelve months or so, both sides have done some more thinking and it looks as if a constructive accommodation is on the brink of being achieved – which is in everyone’s interests.

Scotgold Resources has addressed environmental concerns to an extent that has eased anxieties within the Park Authority – and the Park Authority has let it be known that it is likely to approve the revised proposal at the meeting of its Board later this month (October 2011).

Chris Sangster, CEO of Scotgold, has more than 30 years experience as a mining engineer in Australia, Canada, South Africa and the UK.

At the time of Scotgold’s failed application to the National Park in 2010. Mr Sangster said of the Cononish mine: ‘There’s a particular band of rocks that are of the age when metal deposits were formed in the mine. This band stretches all the way from Tyndrum through to Canada, the United States and then all the way up into Norway and Sweden. We already know there are metal deposits in Sweden, Norway and Canada in those types of rocks, so if we find the right kind of environment we have a good chance of finding further deposits.’

This hope is of finding reserves of greater volume that those estimated by basic geochemical assays done over 10 years ago.

The history of Cononish

The history of this mine to date has involved a series of companies from across the world.

Development of the mine has been delayed by what, for many years, was the low price of gold. Between 1999 and 2002 the UK Chancellor, Gordon Brown, sold 395 tonnes of gold, 79 times the anticipated Cononish resource and half of the UK’s gold reserves, at the bottom of the market – a blind and short termist move estimated to have cost us nearly £5 billion – and the sale of so much gold drove the price of the commodity to an all time low. This made it uneconomic to develop the mine at Cononish in such circumstances.

Then , following the collapse of Northern Rock that signalled the start of the financial crisis of 2008 and which still envelops us – the price of gold has rocketed. This has made development of the Cononish mine it a commercial proposition at last.

Of those who became involved, first it was the Irish – with Ennex International finding a quartz vein on the lower slopes of Beinn Chuirn (lower peak below) in 1984. Ennex spent around a quarter of a million pounds on test drilling which led them to believe that the mine was worth developing. It was estimated – from geochemical assays on drilling cores and samples from the tunnel – that the mine could produce 5 tonnes of gold and 25 tonnes of silver.

In the 1990s, an adit (top photograph – an entrance tunnel to a fairly horizontal mine) of just under 1,300 metres was cut into the hill.

Then, in 1994, the exploration rights passed to the Caledonian Mining Company but the falling price of gold then discouraged Caledonian from development.

In 2007, Australia’s Scotgold Resources bought the exploration rights. They also applied to extend the lease and to start producing gold within two years, with an eight year production period in mind.

With the rise in the price of gold, this company made the application to the National Park which was refused.

Scotgold, production at Cononish and the Crown Estate Commission
If the Park Authority, as they indicate, approve the application this time, Scotgold will still – possibly – need to get permission for commercial production from the Crown Estate Commission.

This brings back to prominence the research into the rights of the Crown Estate Commission which rest on what were known as Mines Royal – research which has been carried out by Brian Wright of the Gold Rivers Trust, and which we published in April of this year (2011): Does the crown estate lack rights to Mines Royal on which the commissioners exact licence fees?.

Mr Wright’s research opens up the question as to whether the Crown Estate has indeed included rights to Mines Royal since two successive laws entered and remain on the statute book – the Mines Royal Acts of 1688 and 1693 respectively.

As we said in the article in question: ‘… in law, gold and silver in admixtures with copper, tin, iron and lead have not been ‘Mines Royal’ since 1688. This is the legal fact that is a facer for the Crown Estate Commissioners, one of which they are aware, which has brought changes to the text on their website but has not stopped them licensing mining for gold and silver and collecting fees.’

The 1693 Act went even further and actually: ‘… binned the very notion of Mines Royal‘.
We advise Scotgold to seek the support of the Scottish Government in further research on this matter and in testing the legal rights of the Crown Estate Commission to levy exploration and commercial production fees on gold and silver mining.

Source: http://forargyll.com/2011/10/national-park-authority-to-approve-cononish-gold-mine-operation/