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Scotgold Resources makes progress on Cononish paperwork

The 'Section 75' agreement, which details matters involving third parties that cannot be enforced through the planning notice, has now been executed and submitted for registration

Cononish
The company looks forward to working with Scottish Enterprise on various initiatives such as the "Invest in Youth" programme

Scotgold Resources Limited (LON:SGZ) said it continues to make progress in the finalisation of the planning application for its Cononish gold and silver project.

Since the unanimous positive "minded to grant" decision by the board of the National Park Planning Authority (NPA) in February, the company has worked with the NPA and other interested parties to secure all the necessary agreements. The most significant of these, the "Section 75", has now been executed and submitted for registration.

READ: Scotgold Resources jumps after receiving planning approval for first commercial gold mine in Scotland's history

The company now expects the formal decision notice from NPA to be awarded shortly. The company is already aware of the various conditions that the decision notice is likely to contain, some of which will need to be addressed before development work on the project, situated near Tyndrum in central Scotland, can begin. It said it has made the necessary preparations to address these pre-conditions promptly once the decision notice is issued.

Award of a Regional Selective Assistance grant

The development agency, Scottish Enterprise, has made an offer of a grant of up to £430,000, conditional upon the creation of 36 full-time employment roles and the capital expenditure of £8.6mln on Phase 1 of the project.

Scotgold had actually budgeted on receiving a grant of £360,000, so this is a bit of a bonus, although not enough to have a material impact on the published project returns.

Further grant funding may be available in due course for the planned Phase 2 expansion of the Cononish project, which it is envisaged will create a further 27 full-time employment roles.

READ: Scotgold still waiting on approval from authorities to complete €1mln sale of French subsidiary

Shares in Scotgold slipped a penny to 23.5p as the company said it had decided to liquidate its up-for-sale French subsidiary. The subsidiary holds no assets or liabilities, other than its Vendrennes exploration licence.

Quick facts: Scotgold Resources Limited

Price: 63.9 GBX

AIM:SGZ
Market: AIM
Market Cap: £31.4 m
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