SGZ.L Share News (SGZ)

(Sharecast News) - Scotgold updated the market on its exploration activities on the Cononish Project and Grampian Project in Scotland on Monday, reporting that new zones of interest had been identified for possible extensions to the Cononish orebody.The AIM-traded firm also highlighted potential for the previously-identified Beinn Udlaidh prospect, located within close proximity the Cononish Project area, and said 'ionic leach geochemistry' was demonstrated to be a more effective exploration tool to conventional 'whole-of-sample geochemistry'/It said a systematic suite of techniques had been developed to advance 'anomalies' through to drill targets.As the company had announced on 26 February, orientation test surveys to evaluate and calibrate various exploration techniques had been undertaken over the known Cononish orebody.Following on from initially promising results, Scotgold said the surveys were expanded.In particular, it said the surveys demonstrated that the use of 'ionic leach' methods for soil and stream sediment sampling produced higher resolution data, as well as being simpler, faster and more cost effective.Together with induced polarisation and very low frequency magnetics, the suite of techniques provided the firm with a systematic approach to early stage exploration that the board said would allow for optimal drill hole planning.More specifically, over the test survey area, the ionic leach soil sampling identified new zones of interest for possible extensions to the Cononish orebody.Those previously-unidentified anomalies were associated off-setting faults and structure in the immediate vicinity, and would guide the future drilling campaigns designed to increase the Cononish JORC-compliant mineral resource.As part of the expansion of the ionic leach stream sediment survey, the drainage area around the known Beinn Udlaidh anomaly was covered.That had highlighted with "much greater clarity" that the area, which is significantly larger than the Cononish drainage area, is a prospective gold target.The board said it was now planning the follow up soil, and induced polarisation and very low frequency magnetics programmes over the area"It is very encouraging that what was in effect a calibration exercise has already identified new targets within the test area over the Cononish deposit and we look forward to what our exploration team can discover using these new techniques over our much larger Grampian Project area in the coming years," said Scotgold chief executive officer Richard Gray."The company's expectation for the Cononish mine to become cash positive in 2020 will accelerate these exploration programs and facilitate our stated strategy of building a pipeline of projects in Scotland."