Scotgold Resources' full year losses narrows

Gold and silver miner Scotgold Resources’ full-year losses narrowed as it aims to find funding for its Highlands mines.

For the year ended 30 June, losses narrowed by 29% to £800,000, compared to the previous year.

Administrative costs rose 15% to £247,000 as exploration expenses fell about 67% to £74,000.

The AIM-listed miner finished a bankable feasibility study in January for its Cononish gold and silver project in Scotland's Grampian Highlands for a basis for discussion with possible finance providers to advance production.

The study included a revised mineral resource estimate to be completed by geological consultancy CSA Global, analysis of the 2013 Cononish development plan to identify areas requiring further input to meet the study’s standards, a study examining alternative mining methods, and an amendment to the existing planning permission for 24 hour, six day plant operations.

The mine had a base case gold price of £688 per ounce with an EBITDA of £67.4m , a pre-tax free cash flow of £43.4m and a pre-tax IRR of 45%.

There were low operating costs with a life of mine average of £327 per ounce equivalent gold.

It has a peak funding requirement of £18.5m and all in capital expenditure was £24m.

Average annual gold production was 23,370 ounce equivalent gold with peak production in the second year with 28,540 ounce equivalent gold.

After raising £500,000 in March through a share placing, it said it would needs to raise further capital or enter into a sale or a joint venture to meet the £840,000 in convertible loan notes which are due in September.

Scotgold said the remaining outstanding balances of the convertible notes owed to non-executive chairman Nat Le Roux is £190,000.

The miner also said it plans to de-list from the Australian Securities Exchange (ASX), after being admitted in 2008.

Shares in Scotgold were up 3.18% to 0.645p at 0950 BST.