Scotgold Resources has revealed it is looking at powering its gold and silver mining activities at Cononish in Argyll with hydroelectricity.
The company said today it was making good progress on ramping up production.
Access to a second “cut and fill stope” – a new excavation area – was achieved on March 21 – an event described by the company as a “pivotal moment in its mine development plan.
The target is for gold and silver output from the site, near Tyndrum, to hit a “run rate” of about 23,500 ounces a year by the end of Q1 2023.
Scotgold said it made “considerable progress” towards this during the first half of its current trading year.
In the last three months of 2021 it produced 1,508oz of gold and 7,200oz of silver.
December was a record month for the production of gold concentrate, with output up by 60% on the previous best month, helping to boost the total to date to 101 tonnes.
Chief executive Phil Day said: It’s been a transformative time for Scotgold which has seen the team work determinedly to deliver on our targets and maximise value at our flagship Cononish mine.
“The second half of calendar year 2021 saw us lay the foundations for growth by implementing initiatives to increase Cononish’s gold recoveries and in turn improve the gold production profile of the mine.
“During the past quarter we have been focused on preparing the access to the second cut and fill stope at Cononish and I’m pleased to report we accessed it as of March 21.”
Mr Day added: “This is a pivotal moment in our mine development plan, allowing us to access reserve mine gold grade more readily, which should see our gold grades increase significantly inline with our mine plan during 2022 and beyond.”
“I look forward to reporting on our calendar year Q1 2022 production results in due course, as we continue to implement optimisation initiatives at Cononish to increase our gold production profile with the target of achieving a c.23,500oz p.a. production run rate of gold by end of Q1 2023.”
Chairman Peter Hetherington added: “Whilst concentrating on the mine optimisation and ramp-up production plans of Cononish has been our priority during 2021 and 2022, our overarching vision is to build the company into a multi-asset gold production company in Scotland that enhances the local environment and economy in ways that have an enduring positive impact.
“In line with our commitment to reduce CO2 emissions we are reviewing the use of hydro power at site and will update the market accordingly on this initiative.”
Scotgold reported pre-tax losses of £3.03 million for the six months to December 31 2021, compared with a deficit of £1.6m a year earlier.
Maiden first half revenue, following the start-up of production in late 2020, came in at £3.7m.
More mines in the pipeline
Scotgold – whose shares were down by about 3% at 64p this morning – holds 13 lease option agreements covering an area of nearly 1,120 square miles of the central Highlands, mostly in rural Perthshire.
Three prospective areas close to Cononish have been identified and the firm intends to explore these during 2022 and 2023.
