REG - Scotgold Resources - Corporate Update

Scotgold ResourcesAnnouncement

29/09/2023 07:00

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RNS Number : 0875O  Scotgold Resources Ltd  29 September 2023

THIS ANNOUNCEMENT RELATES TO THE DISCLOSURE OF INFORMATION THAT QUALIFIED OR
MAY HAVE QUALIFIED AS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE
MARKET ABUSE REGULATION (EU) 596/2014 AS IT FORMS PART OF UK DOMESTIC LAW BY
VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018.

29 September 2023

 

 

Scotgold Resources Limited ("Scotgold", the "Company" or the "Group")

Corporate Update

 

On 19 September 2023, the Company announced an update on the Mining Plus
review and that while the Geological data and documentation suggested 'no
fatal flaws' in the MRE and GC modelling process, the draft mine plan and
associated cash flow forecasts indicate that to deliver to the plan, a
significant capital investment is required.

 

Contingency Planning

Financing discussions are ongoing, they are at an advanced stage with
confirmatory diligence being undertaken. These have not yet reached final
agreement and as such the Company is in discussion with an administration
specialist as a precautionary measure in the event it cannot secure financing
and needs to appoint an Administrator.

 

Court Action

The Company is cognizant of its obligations to its creditor base and has
accumulated arrears which it is intended will be addressed if a successful
re-finance is achieved. Nonetheless, a creditor has recently taken action
which the Board hope to resolve through negotiation of a repayment proposal.
Should matters not be successfully resolved this could reduce the timescale to
achieve a funding solution and necessitate an Administration appointment,
which of course it is hoped can be avoided.

 

Workforce Care and Maintenance Plan

As at 28 September 2023, the Company has placed the majority of its employees
on short term unpaid leave until further notice, allowing the Company time to
advance the financing discussions and preserve funds to help retain some key
trained staff members across mining and plant and maintenance. This care and
maintenance team will maintain the Company's assets and ensure compliance with
statutory, regulatory and environmental reporting obligations for the
immediate future.

 

**ENDS**

 

 

 Scotgold Resources Limited

 Sean Duffy, interim CEO and CFO              Contact via Shore Capital below

 Peter Hetherington, Non-executive Chairman

 Shore Capital (Nomad and Broker)             Tel +44 (0) 20 7408 4090

 Toby Gibbs / Tom Knibbs

 

Notes

 

Scotgold Resources Ltd (AIM:SGZ), is Scotland's first commercial gold
producer. The Company poured first gold in November 2020 at its Cononish Gold
and Silver Mine ('Cononish) in Tyndrum, Scotland and is developing it into a
+23,500-ounce gold mine per annum. Cononish is a high-grade underground mining
operation with a central processing plant producing gold concentrate for
off-take and gold doré for the Scottish Jewellery industry.

 

It is Scotgold's vision to build a mid-tier gold mining company in Scotland
with multiple operations in the country that enhance the local environment and
economy in ways that have an enduring positive impact.

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