3 Feb 2014 07:00
3 February 2014
Scotgold Resources Limited
December 2013 Quarterly Report
Cononish Gold and Silver Project
Since publishing the results of the Cononish Gold and Silver project Development Study in April 2013, the Company has sought a number of alternatives to finance the proposed development of the Cononish mine.
As a result of continued global economic uncertainty and volatile metal prices the market for funding mining projects remains difficult. In response and with the objective of moving the project forward towards production the Company has explored various options with respect to the mine build. This process has identified a number of possible 're-engineering' opportunities to advance the Cononish project whilst reducing the capital required to bring the project to production.
Amongst other possible opportunities, the Company is considering a smaller initial project, treating higher grade material through a smaller processing facility. Examination of the Cononish resource indicates a number of 'higher' grade zones that may be able to be mined discretely from other lower grade areas of the resource. Mining of the higher grade portion of the resource initially would not necessarily preclude the mining of the balance of lower grade material should gold prices and cost profiles be suitable at that stage but this would have to be decided under a separate mine plan.
To this end, subsequent to the successful conclusion of the rights issue, the Company is in the process of commissioning its external mining, metallurgical and tailings consultants to evaluate the options for the smaller project including re-estimating the capital and operating costs.
The results from these evaluations will be incorporated into a revised Development Study, the results of which are expected within the next two to three months.
Financing
On 26 November 2013, the Company announced a Non - Renounceable Rights Issue. The Rights Issue closed on 31 December 2013 with eligible shareholders applying to take up 90% of the Rights Issue. In accordance with the Offer Document, the Directors reserved the right to deal with the shortfall shares at their discretion and the Company successfully placed the balance of the shortfall shares to investors. As a result the Company raised a total of $830,972 before expenses through the issue of 166,174,304 new shares.
Chris Sangster
Managing Director
For further information please contact:
United Kingdom: | ||
Scotgold Resources Limited | Westhouse Securities Limited | Bankside Consultants |
John Bentley (Chairman) | Richard Baty / Martin Davidson | Simon Rothschild |
Tel: +44 (0)77 8592 1505 | ||
Chris Sangster (CEO) | ||
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 | |
Peter Newcomb (Co. Secretary) | Belinda Newman | |
Tel: +61 (8) 9222 5850
| Tel: +61 (8) 9388 0944 Mobile: +61 (0) 401 802 210 | |
Tenement details
The Company holds a Lease (100%) from the Crown Estate Commissioners over Cononish Farm, County of Perth, Scotland UK
The Company holds a Lease (100%) from the landowner over Cononish Farm, County of Perth, Scotland UK
The Company holds five Mines Royal Option Agreements with the Crown Estate Commissioners as detailed below
Glen Orchy: Location - counties of Perth and Argyll, Scotland UK
Glen Lyon: Location - counties of Perth and Argyll, Scotland UK
Inverliever: Location - counties of Dunbarton, Argyll and Perth, Scotland UK
Knapdale: Location - county of Argyll, Scotland UK
Ochils: Location - county of Clackmannan, Perth, Kinross and Stirling, Scotland UK
No tenements were acquired or disposed of during the quarter
No other beneficial interests are held in any farm-in or farm-out agreements
No other beneficial interests in farm-in or farm out agreements were acquired or disposed of during the quarter
Below is the Appendix 5B which was released to the ASX today
Appendix 5B
1.1 Mining exploration entity and oil and gas exploration entity quarterly report
Introduced 01/07/96 Origin Appendix 8 Amended 01/07/97, 01/07/98, 30/09/01, 01/06/10, 17/12/10, 01/05/2013
Name of entity |
SCOTGOLD RESOURCES LIMITED |
ABN | Quarter ended ("current quarter") | |
42 127 042 773 | 31 DECEMBER 2013 |
1.1.1 Consolidated statement of cash flows
Cash flows related to operating activities
| Current quarter
$A | Year to date (6.months) $A | |
1.1 | Receipts from product sales and related debtors
|
- |
- |
1.2 | Payments for (a) exploration & evaluation (b) development (c) production (d) administration | (156,383) - - (34,956) | (297,041) - - (330,658) |
1.3 | Dividends received | - | - |
1.4 | Interest and other items of a similar nature received |
1,201 |
2,255 |
1.5 | Interest and other costs of finance paid | - | - |
1.6 | Income taxes paid | - | - |
1.7 | Other (provide details if material) | - | - |
Net Operating Cash Flows |
(190,138) |
(625,444) | |
Cash flows related to investing activities | |||
1.8 | Payment for purchases of: (a) prospects (b) equity investments (c) other fixed assets | - - 46 | - - 2,521 |
1.9 | Proceeds from sale of: (a) prospects (b) equity investments (c) other fixed assets | - - - | - - - |
1.10 | Loans to other entities | - | - |
1.11 | Loans repaid by other entities | - | - |
1.12 | Other (provide details if material) | - | - |
Net investing cash flows |
46 |
2,521 | |
1.13 | Total operating and investing cash flows (carried forward) |
(190,092) |
(622,923) |
1.13 | Total operating and investing cash flows (brought forward) |
(190,092) |
(622,923) |
Cash flows related to financing activities | |||
1.14 | Proceeds from issues of shares, options, etc. | - | 200,000 |
1.15 | Proceeds from sale of forfeited shares | - | - |
1.16 | Proceeds from borrowings | - | - |
1.17 | Repayment of borrowings | 37,295 | 31,185 |
1.18 | Dividends paid | - | - |
1.19 | Other - Share Issue Costs | (10,000) | (10,000) |
Net financing cash flows |
27,295 |
221,185 | |
Net increase (decrease) in cash held
|
(162,798) |
(401,739) | |
1.20 | Cash at beginning of quarter/year to date | 331,677 | 570,253 |
1.21 | Exchange rate adjustments to item 1.20 | - | - |
1.22 | Cash at end of quarter |
176,319
|
176,319 |
Payments to directors of the entity, associates of the directors, related entities of the entity and associates of the related entities
Current quarter $A | ||
1.23 |
Aggregate amount of payments to the parties included in item 1.2 |
44,900 |
1.24 |
Aggregate amount of loans to the parties included in item 1.10 |
Nil |
1.25 |
Explanation necessary for an understanding of the transactions | |
| N/A
| |
Non-cash financing and investing activities
2.1 | Details of financing and investing transactions which have had a material effect on consolidated assets and liabilities but did not involve cash flows |
N/A
|
Fully subscribed Rights Issue completed in January 2014 raised $830,000 before costs.
2.2 | Details of outlays made by other entities to establish or increase their share in projects in which the reporting entity has an interest |
N/A
|
Financing facilities available
Add notes as necessary for an understanding of the position.
| Amount available £ | Amount used £ | |
3.1 | Loan facilities
| £1,500,000 | £1,500,000 |
3.2 | Credit standby arrangements
| Nil | N/A |
Estimated cash outflows for next quarter
$A | ||
4.1 | Exploration and evaluation
| 200,000 |
4.2 | Development
| - |
4.3 | Production
| - |
4.4 | Administration
| 150,000 |
Total |
350,000 |
Reconciliation of cash
Reconciliation of cash at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts is as follows. | Current quarter $A | Previous quarter $A | |
5.1 | Cash on hand and at bank | 26,152 | 7,120 |
5.2 | Deposits at call | 150,167 | 324,557 |
5.3 | Bank overdraft | ||
5.4 | Other (provide details) | ||
Total: cash at end of quarter (item 1.22) | 176,319 | 331,677 | |
Changes in interests in mining tenements and petroleum tenements
Tenement reference and location | Nature of interest (note (2)) | Interest at beginning of quarter | Interest at end of quarter | ||
6.1 | Interests in mining tenements and petroleum tenements relinquished, reduced or lapsed
| Nil |
|
|
|
6.2 | Interests in mining tenements and petroleum tenements acquired or increased
| Nil |
|
|
|
Issued and quoted securities at end of current quarter
Description includes rate of interest and any redemption or conversion rights together with prices and dates.
Total number | Number quoted | Issue price per security (see note 3) (cents) | Amount paid up per security (see note 3) (cents) | ||
7.1 | Preference +securities (description) | ||||
7.2 | Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buy-backs, redemptions | ||||
7.3 | +Ordinary securities
| 221,565,739 | 221,565,739 | ||
7.4 | Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buy-backs | ||||
7.5 | +Convertible debt securities (description) | ||||
7.6 | Changes during quarter (a) Increases through issues (b) Decreases through securities matured, converted | ||||
7.7 | Options (description and conversion factor) |
26,222,222 3,000,000 15,316,110 153,161 7,111,111 | Exercise price £0.045 $0.080 £0.045 £0.031 £0.045 | Expiry date 24 July 2015 31 March 2022 7 June 2014 7 December 2015 28 March 2016 | |
7.8 | Issued during quarter | ||||
7.9 | Exercised during quarter | ||||
7.10 | Expired during quarter | ||||
7.11 | Debentures (totals only) | ||||
7.12 | Unsecured notes (totals only)
| ||||
Compliance statement
1 This statement has been prepared under accounting policies which comply with accounting standards as defined in the Corporations Actor other standards acceptable to ASX (see note 5).
2 This statement does give a true and fair view of the matters disclosed.
Peter John Newcomb
Director
Notes
1 The quarterly report provides a basis for informing the market how the entity's activities have been financed for the past quarter and the effect on its cash position. An entity wanting to disclose additional information is encouraged to do so, in a note or notes attached to this report.
2 The "Nature of interest" (items 6.1 and 6.2) includes options in respect of interests in mining tenements and petroleum tenements acquired, exercised or lapsed during the reporting period. If the entity is involved in a joint venture agreement and there are conditions precedent which will change its percentage interest in a mining tenement or petroleum tenement, it should disclose the change of percentage interest and conditions precedent in the list required for items 6.1 and 6.2.
3 Issued and quoted securities The issue price and amount paid up is not required in items 7.1 and 7.3 for fully paid securities.
4 The definitions in, and provisions of, AASB 6: Exploration for and Evaluation of Mineral Resources and AASB 107: Statement of Cash Flows apply to this report.
5 Accounting Standards ASX will accept, for example, the use of International Financial Reporting Standards for foreign entities. If the standards used do not address a topic, the Australian standard on that topic (if any) must be complied with.