12th May 2016 09:38
LONDON (Alliance News) - Scotgold Resources Ltd on Thursday said it has been awarded a new exploration licence in Portugal and concluded agreements regarding its Grampian project in Scotland.
Scotgold has been awarded the Pomar exploration licence, which lies in the east of Portugal near Castelo Branco, for a period of three years with the potential to extend the licence further.
The licence area covers 264 square kilometres and is prospective for antimony and gold. Alongside the historic mines within the licence, das Gatas, Pomar and Casalihno, the licence also holds numerous small scale antimony trials and occurrences, it said.
Notably, those small mines have not been active since the 1940s, and a short exploration programme was conducted on the licence by its former owners in the 1980s, but it has lain idle since.
Scotgold will begin assessing historic data from that previous work in order to determine which exploration techniques should be used. Exploration will define any extensions to the existing mineralisation.
Initial expenditure on the licence will be minimal, costing only EUR40,000 in the first year, which will cover the costs of acquiring the historic data, a soil sampling programme and regional mapping activities.
"The application for and grant of the Pomar licence is in accordance with Scotgold's strategy of identifying and developing high-grade, low-impact projects with a focus on gold and other strategic metals, located in a low-risk European environment. Together with the progress on our Grampian project, the company is already demonstrating promising exploration potential," said Chief Executive Richard Gray.
In addition, Scotgold has concluded talks with the Crown Estates regarding the Grampian project, the company's other major exploration asset which lies in Scotland.
The Crown Estate is an independent commercial business that was created by an Act of Parliament, holding a portfolio of property and other assets in the UK to generate revenue for the Treasury.
Included in its portfolio are the mineral rights over gold and silver prospects, which are leased out to companies in return for royalties. Scotgold has five leases that form its Grampian project, but the Crown Estate has been working with the company and other industry participants to revise terms.
Following the conclusion of discussions, the Crown Estate has extended the tenure that each lease has to six years compared to the previous agreement whereby each lease was reviewed annually. The tenure has been extended to better reflect modern exploration programmes, the company said.
Also, each lease will be reduced in size over the next three years to 250 square kilometres, but Scotgold said all the lease areas cover the same areas as before, suggesting the land area size has stayed the same but is now covered by more leases.
Importantly, Scotgold would be able to apply for more land areas that have been relinquished by other parties.
"The company continues to move forward on all fronts. Whilst the previously reported developments associated with the bulk processing trial at our Cononish gold and silver project continue apace, we are adding to and improving the quality of our exploration assets," said Gray.
Scotgold shares were up 4.8% to 1.07 pence per share on Thursday morning.
By Joshua Warner; [email protected]; @JoshAlliance
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