Scotgold mine at ‘record levels of gold concentrate’

Scotgold Resources Limited, the Australia-based gold exploration firm focused on Scotland, said on Thursday its Cononish Gold and Silver Mine near Tyndrum has achieved record levels of gold concentrate production so far in April.

The increase in gold grade being transferred to the ROM (Run Of Mine) pad has seen April 2022 achieve record levels of gold concentrate production,” said Scotgold.

“Just over 138 tonnes of concentrate has been produced during April thus far, comfortably ahead of any previous full months production.”

However, the company said that for the first quarter: “Gold production totalled 1,257 gold ounces for Q1 2022 – marginally lower than production guidance of 1,400 – 2,200 oz gold.”

In a first quarter production update, Scotgold confirmed it entered into an agreement with Fern Wealth GmbH, a wealth management company based in Zug, Switzerland, to “arrange the procurement of up to £3 million funding from a syndicate of high-net- worth investors to fast-track Cononish optimisation initiatives.”

Scotgold Resources CEO Phil Day said: “Whilst we achieved slightly lower gold production through the quarter as we developed through the lower grade areas in the mine so to access the areas of known high grade and set up ‘cut and fill’ stopes, we have focussed and delivered on our Q1 2022 objectives.

“Objectives included developing the mine and maintaining the process plant feed throughput at Phase 1 rates, seeing us achieve a 10% increase on Q4 2021 mining and feed throughput to the process plant rate.

“These targets have been realised thanks to the hard-work and determination of our committed team here in Tyndrum.

“As we enter Q2 2022, we have reached an exciting time in Cononish’s optimisation and production ramp-up.

“We successfully accessed the (CAF2) stope at Cononish on 21 March in line with schedule and are beginning to see the results.

“Cononish is a high-grade operation, and we are delineating gold grades of up to 35g/t for processing.

“Importantly by adopting this ‘cut and fill’ methodology to the short term mine plan we can better extract certain areas of the mine, obtain better indications of the geotechnical and resource characteristics in localised areas which allows for better stability and reliability of gold production going forward from the Cononish mine. 

“Our intention is to continue developing tunnels in the mine so that we can access even further areas utilising the ‘cut and fill’ stope mining method to exploit higher grade areas efficiently.

“By late Q3 2022, when sufficient tunnel development in the mine has been conducted, the original long hole stoping method of mining will commence and we expect to see yet another step change in performance, gold grade accessibility, stability of production and reduced costs per tonne of ore mining.

Optimising our flagship Cononish gold mine to maximise its intrinsic value remains a core priority for 2022.

“Cononish is already a cash generative operation yielding attractive margins, however we believe we will be able to maximise this value more efficiently by utilising debt funding, instead of cashflows, to fast-track plans.

“We look forward to updating the market further on our debt funding package and optimisation initiative implementation and remain confident of achieving our near-term objectives and longer-term strategy in line with achieving 23,500 ounces of gold run rate by the end of Q1 2023.”