From the Herald Company tries to define further deposits near...

From the Herald Company tries to define further deposits near Cononish mine SCOTGOLD Resources, t he company mining for gold and silver in Argyll, is to begin aerial mapping of the prospects for exploration in Grampian. The company continues to actively pursue exploration activities in the Dalradian group of the south west Grampians The company has reported that it cut its pre-tax loss last year from Australian $2.65 million (£1.42m) to A$1.51m, largely due to a fall in share-based payments from A$910,000 to A$121,000. Interest costs jumped from A$103,000 to A$193,000. The company’s accumulated losses are nearly A$8m, but total equity rose slightly from A$11.1m to A$11.5m. Scotgold says it believes there is “potential to define further resources close to the Cononish mine, subject to appropriate further work,” whilst admitting that the possibility is “highly conceptual and there is no guarantee” of finds. It says in order to facilitate financing under current market conditions, the explorer has continued to evaluate “possible alternat ive configurations f or t he Cononish Gold and Silver Project with a view to optimising returns” and reducing overall funding needed to bring the project to production. Two months ago chief executive Chris Sangster said an easing of national park planning restrictions to enable six day 24 hour production, rather than 16 hour days, would allow a smaller design configuration, reducing start-up capital expenditure by 10 to 15 per cent and improving “significantly” the project’s returns. Scotgold said yesterday it had met with the Loch Lomond and Trossachs planning authority, conducted a joint site visit, and intended to submit the requisite new application shortly. It went on: “The company is in discussion with possible plant suppliers regarding the capital costs and financing of POSITIVE MOVES: Chief executive Chris Sangster said an easing of national park planning restrictions would help to improve the project’s returns. the possible smaller facility, and is in negotiations relating to supplier financing for the mining equipment required, with the aim of achieving further reductions in the initial capital expenditure.” It said almost two thirds of the conditions relating to the February 2012 planning approval for the project had now been discharged. Meanwhile six companies had already pre qualified to tender for construction of a tailings management facility, and that work could be “rapidly completed on financing without impacting the development schedule.” On Cononish it said: “Given the advanced state of project development, the company believe Cononish could be in production within 18 months of obtaining financing.” Meanwhile Scotgold is also looking to the Grampian Gold Project. “The company continues to actively pursue exploration activities on its substantial land position in the Dalradian group of the south west Grampians, a terrain highly prospective for both gold and potential base metal occurrences. The majority (85 per cent) of the area currently under option to Scotgold is located outside the Loch Lomond and the Trossachs National Park.” It says basic exploration data, including gravity and airborne magnetics, is available from early government surveys but “does not adequately reflect the prospectivity of the area.” In 2011 the company began stream sediment sampling and has now taken over 750 samples, with a further 500 to come. It has also co-sponsored doctoral research projects to investigate gold occurrences in the area. It now plans an airborne geophysical survey in order to assess the area’s potential “to host similar ‘Cononish style’ deposits.” Scotgold cut administration costs from A$355,000 to A$302,000 last year, while employee and consultant costs came down from A$377,000 to A$236,000.