Saturday July 5, 11:53 AM
Gold Boom Prompts Mine Reopening
By Sky News
Scotland's only remaining gold mine is expected to reopen in the next few weeks due to the precious metal's soaring price. The Cononish mine near Tyndrum, in Stirlingshire, closed 10 years ago because the low cost of gold made mining
it too expensive.
Now, though, investors keen to avoid falling global stock markets have been buying gold, doubling its price and making the reopening of Cononish economically viable.
It is estimated that with current precious metal values, the mine contains £76m worth of gold and silver embedded in the quartz rock.
The infrastructure needed to begin mining is already in place, including rail lines and ventilation tunnels, the legacy of excavations 20 years ago when the gold seams were first discovered.
A new rush to cash in on the boom is now under way.
Chris Sangster, chief executive of Scotgold Resources, the Australian company behind the plan, said: "It's now a very viable project.
"There are about four-and-a-half tons of high quality gold, which is about 154,000oz, and around 600,000oz of silver.
"Now that the gold price is hovering around $900 an ounce it radically changes the economics of the project."
Test drilling in the area means the gold and silver content has been well charted and further excavations are about to start.
A specialist drilling rig is currently being transported from Chile and when it arrives further extensive excavation can begin.
But the area lies within the Loch Lomond and Trossachs National Park, so there are environmental sensitivities to consider.
As the mine already exists, the planning application is simply to extend mining consent, something Gordon Watson, from the National Park Authority, believes is workable.
"Scotgold Resources are very serious about addressing the environmental issues," he said.
"We have to safeguard the head waters of the River Tay, which lie directly in the area, and we will do that vigourously.
"But we are also very aware that gold isn't something that's found every day, so we are looking at this as positively as we can."
When the mine is fully operational it should create about 60 jobs, with production expected to start in 2010.
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