Scottish listed miner Scotgold Resources said it produced profitable gold and silver for the first time in its history last month as it announced a “significant improvement” in production at its mine at Cononish on the edge of Loch Lomond national park.
Shares edged up 1.5% higher to 67.5p at close of the market.
The company said the mine near Tyndrum had produced 50 tonnes of concentrate in August, equating to more than 450oz of contained gold and 1,900oz of silver.
High grade vein
The AIM-listed firm said the significant improvement in production was realised through “continued exploitation of high-grade area of vein and improvement in processing plant efficiencies”.
The firm also said it now plans to recruit additional mining and processing plant operatives, as well as purchasing and warehouse staff.
The update marks a return to form after it warned output in its first year of production from Cononish would be “materially” below previous guidance. The announcement in late April saw Scotgold’s market value plunged nearly 30%.
The company said it now plans to announce “upward adjustment” of its mine plan which is currently being assessed.
Phil Day, chief executive, said the the company was on track to become a “consistent and stable producer”.
Upward adjustment
He said: “I am delighted to report a significant improvement in our overall mining and production activities during August.
“Furthermore, this is indicative of an overall upturn in our production profile for the remaining months of 2021 and the board and management are now assessing an upward adjustment to the mine and production plan reported in Q2 2021.
“The progress made at Cononish has been driven by the commitment and skill of the Scotgold operational and support teams and I am grateful to the entire workforce for their dedication and efforts.
“I look forward to providing further updates in the coming weeks and months as we look to build on this momentum, drive further advances, and ramp up operations to the next stage.”
The update said that mining activity at Cononish had “continued uninterrupted” during August and had remained “focussed on the high-grade area of the vein and necessary development to access future reserves”.
This was achieved despite an unplanned six-day shutdown from 4th to 10th August, adding that “planning issues have now been addressed and unnecessary shutdowns will now be avoided”.
It’s statement confirmed that: “Production revenues have exceeded operating costs for the first time in Scotgold history.”