21st Jan 2015 11:18
LONDON (Alliance News) - Scotgold Resources Ltd shares rose 40% Wednesday after it said its resource at the Cononish gold project in Scotland has been significantly upgraded and it is preparing a mine development plan for the project whilst evaluating options for financing.
Scotgold shares were up 40% to 0.735 pence per share on Wednesday morning.
The indicated and measured ore tonnage at the project has almost trebled from the previous estimate to 541,000 tonnes, whilst the average gold grade of the tonnage rose by 18% to 13.4 grammes of gold per tonne. This led to gold metal content trebling to 248,000 ounces, with the average grade of gold increasing by 9% to 14.3 grammes of gold per tonne.
Following the updated JORC compliant mineral resource estimate, Scotgold is completing a 3D geological model which will form the basis of a revised mine development plan at the project, which should be completed in the second quarter of 2015.
"This mineral resource estimate released today is truly a cornerstone for the Cononish project and Scotgold Resources. In addition to the significant increase in resource ounces, this work done on the 3D modelling in particular will underpin a more robust optimisation of our mining plan," said Chief Executive Richard Gray.
The company has also applied for a three-year extension to its planning permission that allows Scotgold to process ore 24 hours a day, six days a week. The company said the extension has been recommended by an executive at the Loch Lomond and the Trossachs National Park Planning Authority, where the application has been sent.
"If approved this amendment will facilitate one of several opportunities to reduce the capital requirement for the project," said the company.
Scotgold is currently evaluating a number of options it has to finance the Cononish project after becoming more financially flexible when it paid off its RMB loan in December.
In addition, the company said it is continuing with early stage regional exploration on the Grampian gold project, but it has decided to defer conducting a airborne geophysical survey at the site until the second quarter, when options for financing in the medium- and longer-term have been progressed.
By Joshua Warner; [email protected]; @JoshAlliance
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