REG - Scotgold Resources - Pre-close Q4 2022 – Production Update

Scotgold ResourcesAnnouncement

21/12/2022 07:00

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RNS Number : 3949K  Scotgold Resources Ltd  21 December 2022

 

 

 

 

 

 

21 December 2022

 

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

Pre-close Q4 2022 - Production Update

 

Scotgold Resources Limited (AIM: SGZ), Scotland's first commercial gold
producer, announces a pre-close Q4 2022 production update for its Cononish
Gold and Silver Mine in Scotland ("Cononish").

 

·    Ongoing underground resource definition and grade control drilling
commenced early October 2022 and is progressing well - providing essential
information for the correct design and shape of stopes when mining transitions
from development tunnelling to long hole retreat stoping.

·    December 2022 mine design and production forecast originally planned
to extract the    high-grade ore above Cut and Fill (CAF 1) from between
the 415-430 level throughout December 2022.

·    Risk assessments, planning and preparation to both transition the
mine to long hole stoping in early 2023 and to continue accessing the
430-development level access was completed in early December 2022.

·    Data gathered during risk assessment and planning highlighted safety
concerns in developing the 430-development level access after stoping between
the 415-430 level was completed during December, delaying the eventual
continuous long-hole stoping methodology required for Phase 2/full production
levels.

·    Decision taken to change the short-term mine schedule in mid-December
2022 and continue on the 430-development level access to expedite continuous
stoping in the western areas in 2023.

·    Due to changing the short-term mining schedule and harsher than
expected weather conditions in December, production forecast for Q4 2022 is
now set at 2,000 ounces of gold (previous forecast 3,000 to 3,500 ounces of
gold).

·    Short-term mine plan change and current adverse weather conditions
will only impact Q4 2022 production. The mine remains on track to achieve
Phase 2/full production with the commencement of long hole stoping and a
run-rate of 23,500 ounces run-rate of gold per annum in 2023.

·    Mining development over 2022 has continually increased giving the
Company continued confidence the original long hole stoping mine method will
be reached as originally planned - see fig 1.

·    Long hole stoping is a widely used mining method that allows blasting
a sequence of stopes and improves ore recovery efficiencies. Once long hole
stoping is achieved, minimal dilution and increased ore recovery will be
realised (and in parallel with all other optimisation initiatives implemented
during 2021 and 2022 at Cononish across the underground mine and processing
plant), provide continuity of ore mined/ounces produced on a week by
week/month by month basis.

·    Q4 2022 operations, production, and sales update, including 2023
outlook will be announced in January 2023. The Company will also host a live
webinar presentation to update shareholders and investors of its plans for
2023 as it continues to develop Cononish to achieve Phase 2/full production
levels of 23,500 ounces p.a. run rate of gold in 2023.

 

Scotgold Resources CEO, Phil Day said, "Whilst it is disappointing to report
that Q4 2022 production guidance will be missed, I am firm in my belief that
it is not material in terms of near-term development of Cononish and realising
Phase 2/full production in 2023 as planned.  As outlined in our Final Results
and Annual Report, transformational progress has been made over the past year
and I look forward to 2023 and reporting on our progress at Cononish as an
exceptionally high-grade, low-cost, cash generative operation."

 

 

Fig 1. Lateral Mining development by month

 

 

 

The information contained within this Announcement is deemed by the Company to
constitute inside information as stipulated under Article 7 of the Market
Abuse Regulation (EU) No. 596/2014 (as amended) as it forms part of the
domestic law of the United Kingdom by virtue of the European Union
(Withdrawal) Act 2018 (as amended). Upon the publication of this Announcement
via the Regulatory Information Service, this inside information is now
considered to be in the public domain.

 

 

**ENDS**

 

 Scotgold Resources Limited     Shore Capital             Celicourt Communications

 Chief Executive Officer        Nomad and Broker          Financial PR

 Phil Day                       Toby Gibbs / John More    Felicity Winkles

 Via Celicourt Communications   Tel +44 (0)20 7408 4090   Tel +44 (0) 208 434 2643

                                                          Tel +44 (0) 774 8843 871

 

 

 

 

Notes

Scotgold Resources Ltd (AIM: SGZ), is Scotland's and the UK'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 by the end of Q1 2023. 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.  Once in full production, the mine has
anticipated forecast operating costs of c.£544/oz AISC, which will place
Cononish in the lowest quartile of gold mining operations globally.

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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