Scotgold is being put out on the media, so we could expect some hefty buying soon as pi's become familiar with this little known Scottish gem... http://www.proactiveinvestors.co.uk/companies/news/41565/scotgold-study-underlines-the-robust-economics-of-cononish-project-41565.html
ScotGold study underlines the robust economics of Cononish Project 8:19 am by Ian Lyall The company’s preliminary assessment of the economics predicts Cononish will produce 21,000 ounces of gold and 74,700 ounces of silver a year at an average cash cost of US$575 an ounce. ScotGold (LON:SGZ) this morning unveiled robust economics for its planned mine in the Scottish highlands. The Cononish Project is expected to deliver £23.3 million of pre-tax cashflow over the life of the operation at a gold price of US$1,100 an ounce, giving an internal rate of return of almost 25 per cent, according to the results a development study. The current gold price of US$1,655 an ounce would give free cashflow of £65.9 million and IRR of 62.5 per cent, meaning the payback on the initial investment of 18 months. ScotGold said discussions on financing options are “ongoing”. However it confirmed it is on track to begin development by the end of the year. The company’s preliminary assessment of the economics predicts Cononish will produce 21,000 ounces of gold and 74,700 ounces of silver a year at an average cash cost of US$575 an ounce. Chief executive Chris Sangster said: "The results from the updated study clearly demonstrate the viability of the Cononish Project. “At base case gold price assumptions, project financials are robust with more than acceptable returns. “The project is highly leveraged to gold prices and at current prices is highly cash generative with over £65 million in pre-tax free cashflow over the life of mine. “The results underpin Scotgold's intention to proceed to a production decision as soon as possible subject to securing financing."
SGZ Price at posting:
6.0¢ Sentiment: ST Buy Disclosure: Not Held
