Scotgold to start processing trial at Cononish

The AIM-traded company said it would process 2,400 tonnes of its stockpile over a six-month trial period. Scotgold said the stockpile was believed to contain 7,000 tonnes, at grades of 7.9 grams per tonne of gold, and 39 grams per tonne of silver.

Early discussions held by Scotgold had indicated that the Scottish-mined gold produced from the trial could be sold at a significant premium.

The results and experience gained from the bulk planning trial would allow the company to investigate whether a phased mine development would achieve higher returns to shareholders and lower peak funding.

"This is the most tangible and exciting development undertaken by the company since incorporation," said chief executive officer Richard Gray.

"In addition to anticipated positive technical results, the trial will produce an historic 'first pour' gold output, sufficient to determine whether there are grounds to review the mine development plan and moreover to establish Cononish as a low cost, low risk, near term production, gold project," he added.

A pre-planning application enquiry relating to planning permission for the bulk planning trial had been submitted to the Loch Lomond & The Trossacks National Park Planning Authority, and a formal planning application was to be filed shortly.

"Both I and the board as a whole fully support this initiative by the company," said chairman Nat le Roux.

"It represents a major step in moving Cononish into production as early as possible, which is our prime focus and the key to realising value for our shareholders," he explained.