13 Feb 2012 13:43
13 February 2012
Scotgold Resources Limited ("Scotgold" or the "Company")
Award of Planning Permission at Cononish
Scotgold Resources Ltd is pleased to announce that it has concluded discussions with the National Parks Authority (the "NPA") and that the NPA have today issued the Decision Letter formally granting planning permission for the Cononish Gold and Silver Project.
Recommendation for the grant of planning permission at Cononish was made by the Board of the NPA on 25th October 2011, subject to agreement on a number of outstanding conditions and the conclusion of legal agreements, which have now been met.
Principal amongst these negotiations was agreement regarding the magnitude of bonds to be posted to guarantee restoration and to implement the Greater Cononish Glen Management plan in its agreed form.
Scotgold's Chief Executive Officer, Chris Sangster commented:
"The formal award of planning permission represents a further significant milestone in progressing the Cononish Gold and Silver project to production with all planning negotiations now completed.
"The Company and its agents have continued to enjoy a close working relationship with the NPA and Scotgold would like to acknowledge the spirit in which negotiations have been conducted in order to bring the negotiations to a successful conclusion.
"Following the issue of the Decision Letter and subject to the expiry of the requisite judicial review period of three months, the Crown Estate will issue the mining lease. The Company is in the process of updating the Cononish Development Study and is examining finance options for the project in order to be able to proceed to development in the second half of 2012."
John Riley, Chairman of the local Community Council, said: "The Strathfillan Community Council wish to congratulate Scotgold and the National Park Authority on the successful conclusion of negotiations. It is gratifying to see that both bodies have been successful in accommodating the interests of all parties and that measures are in place for the appropriate restoration and indeed improvement of Cononish Glen when the mine eventually ceases production. We now look forward to an early commencement of the construction of the mine leading to production getting underway, which we believe will bring significant economic benefits to our rural community and also to the greater benefit of the Scottish economy."
Stakeholders attention is drawn to the NPA press release on their website http://www.lochlomond-trossachs.org
For further information please contact:
United Kingdom:
Scotgold Resources Limited | Westhouse Securities Limited | Bankside Consultants |
John Bentley (Chairman) Chris Sangster (CEO) | Richard Baty / Petre Norton | Simon Rothschild / Elena Kuza |
Tel: +44 (0)77 2562 9509 | Tel: +44 (0)20 7601 6100 | Tel +44 (0)20 7367 8888 |
Australia:
Scotgold Resources Limited | Professional Public Relations |
Shane Sadleir (Non-Executive Director) | Belinda Newman |
Tel: +61 (8) 9428 2950 Mobile: +61 (0) 411 704 498 | Tel: +61 (8) 9388 0944 Mobile: +61 (0) 401 802 210 |
Forward Looking Statements:
This release includes certain "forward looking statements." All statements, other than statements of historical fact, are forward looking statements that involve various risks and uncertainties.
There can be no assurances that such statements will prove accurate and actual results and future events could differ materially from those anticipated in such statements.
Background
1 Scotgold Resources
·; Scotgold Resources is a mining exploration and development company listed on the Australian Securities Exchange in January 2008 and the AIM market of the London Stock Exchange in the UK in February 2010.
·; The Company was formed with its sole focus on exploring for gold and silver in Scotland, with the already identified Cononish Gold and Silver Project as its core asset. Once in production, the Project will be Scotland's first commercial gold mine.
·; Scotgold acquired the Cononish Gold and Silver Project in 2007 and has been working towards bringing the project to production in conjunction with its ongoing exploration efforts at Cononish and in the south west Grampians.
·; In April 2011 Scotgold announced that it had accepted an offer of a Regional Selective Assistance (RSA) grant from economic development agency, Scottish Enterprise, of up to £600,000 for the establishment of mine facilities and job creation, conditional on the firm obtaining planning permission.
·; In July 2011 Scotgold submitted its reapplication for planning permission, which was granted subject to the conclusion of various legal agreements in October 2011
2. Cononish Gold and Silver Project
·; The Cononish Gold and Silver project consists of the establishment of a small underground mining operation with associated processing facilities and infrastructure. In production, it is estimated the mine would produce around 20,000ozs of gold and 80,000 ozs of silver annually.
·; A scoping study on the Cononish Project completed by Australian Mining Consultants Ltd (AMC) in mid 2009 indicated positive returns using a gold price of US$ 720 / oz (GBP£450 /oz). At the current gold price of around US$ 1800 / oz (GBP £1100 / oz), the Project has the potential to generate significant cashflows for the Company. Based on this 2009 study, at a gold price of US$ 1270 / oz (GBP£800 / oz), the Project would generate around US$ 87 million (GBP £55 million) free cashflow over its lifetime. Scotgold is in the process of updating this study prior to a production decision.