26th Nov 2013 10:11
LONDON (Alliance News) - Scotgold Resources Limited Tuesday said access to funding in order to develop its Cononish gold and silver project in Scotland remains difficult.
The gold, silver and base-metal exploration company said that since the development plan for Cononish was announced in April, the company has sought a number of alternatives to finance the proposed development of the site and bring it into production within a reasonable time frame.
The company said it has identified a number of possible 're-engineering' opportunities to develop Cononish whilst reducing the capital required to bring the project to production.
Scotgold said that included in these opportunities is a possible smaller-scale initial project, treating higher grade material through a smaller processing facility, but that such a possible option would require discussion with the Loch Lomond and The Trossachs National Park Planning Authority.
The company said it has requested an extension to its loan facility be made and also Tuesday launched a rights issue to raise further working capital. Scotgold said it will issue 166.2 million new shares at 0.50 cents per share to raise AUD830,871.
Scotgold said that it has been advised that Luiri Gold Ltd., parent of Zio Holdings Ltd., which took part in the company's September placing with a view to carrying out due diligence on Scotgold's assets, will "pursue a corporate transaction" with Scotgold due to the current market conditions.
Scotgold's shares were down 8.0% to 0.92 pence, putting it among the top AIM losers in early trading Tuesday. The stock had fallend as far at 0.77 pence Tuesday, just off its 52-week low of 0.75p.
By Tom McIvor; [email protected]; @TomMcIvor1
Copyright © 2013 Alliance News Limited. All Rights Reserved.
Related Shares:
SGZ.L