(Alliance News) -Â Scotgold Resources Ltd on Monday said it has raised GBP3 million to accelerate plans to double production at the Cononish gold and silver mine in Scotland.
Scotgold raised the funds via a placing of 2.7 million depositary interests at 110 pence each. Scotgold shares were down 23% at 116.50p in London on Monday.
The gold exploration and production company will use the proceeds to accelerate phase two development of the Cononish mine, which will involve production doubling to 72,000 tonnes of ore per year. Average annual gold equivalent production during phase two will rise to 23,500 ounces from 9,910 ounces during phase one.
Phase two production will commence by May 2022, being 11 months earlier than previously scheduled and 17 months after the initial gold pour in November.
Funds will also be used to increase exploration activities.
"We have an exceptionally exciting few weeks ahead of us as we make final preparations for our first gold pour at Cononish by 30 November. As we ramp up production thereafter, the funds raised today will allow us to commit to the expenditures required to build on this anticipated momentum and accelerate the phase 2 expansion project, whilst at the same time maintaining prudent cash reserves," said Chief Executive Richard Gray.
SP Angel Corporate Finance LLP acted as sole broker to the placing.
By Lucy Heming;Â lucyheming@alliancenews.com
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