Scotland business

First gold 'poured' from Cononish mine

Cononish mine Image copyright Scotgold Resources

A Scottish mine has produced gold for the first time following the launch of an ore processing trial.

Mining firm Scotgold Resources is crushing 2,400 tonnes of ore which has been stockpiled at Cononish near Tyndrum in central Scotland.

It is targeting "first pour" production of between 400 and 600 ounces of gold during the initial six-month trial.

About 100 ounces (almost 3kg) of that will be sent to jewellers to test the market for Scottish gold.

Australia-based Scotgold is hopeful that the gold's rarity may command a premium price.

A small-scale pilot plant has already started processing material at the site after permission was granted by the Loch Lomond and the Trossachs National Park Authority earlier this year.

The mining firm said the trial represented "a significant milestone" for the company as it seeks to persuade potential investors to back larger-scale production at Cononish.

The trial will also provide a basis for a review of the mine's development plan.

The company has estimated that several tonnes of gold could be extracted from Cononish.

Image copyright Scotgold Resources
Image caption Richard Gray described the launch of the trial as "a significant milestone" for the Cononish project

The Cononish project was first launched nearly a decade ago but has faced delays as a result of falls in the price of gold, lack of finance and problems with planning permission.

Scotgold technical consultant Chris Sangster said it was an "amazing achievement" for the mine to have got this far.

He told BBC Scotland: "Cononish itself is quite a small deposit in terms of global gold mining scales, but the area around Cononish we think holds a lot of potential.

"Scotland is a country that has been ignored by the mineral exploration venture capitalists for a long time.

"We hope that by drawing attention to Cononish and developing the opportunity here will spark some interest in the mineral potential of Scotland."

'Significant milestone'

Scotgold has a licence to look for gold in an area covering more than 4,000 sq km of the Highlands, and is confident that other deposits similar to Cononish can be found.

The price of gold has recovered this year, having slumped from about $1,770 an ounce in August 2012 to just over $1,000 last December. This week it has been trading at more than $1,350 an ounce.

The stockpiled ore is reckoned to contain 7.9 grammes of gold per tonne, and 39 grammes of silver.

Scotgold chief executive Richard Gray said: "It is extremely satisfying to be able to celebrate this significant milestone with some of our long-standing stakeholders.

"The achievement of gold production provides tangible evidence of our progress and we appreciate the support of all our stakeholders in getting to this point."

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