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Backing for gold mine near Tyndrum grows

Views towards Glen Cononish, near Tyndrum.
Views towards Glen Cononish, near Tyndrum.

Metals exchange and spread betting expert Nat le Roux has thrown his weight behind plans to mine gold in the Loch Lomond and the Trossachs National Park.

Mr le Roux, a former chief executive of IG Group and now non-executive director of the London Metal Exchange, is one of three “strategic” investors to take a significant shareholding in Scotgold Resources and provide further finance as it seeks to develop the Cononish prospect, near Tyndrum.

Australia-based mining and precious metals investor Richard Harris is another, but Scotgold did not disclose the identity of its third backer on Tuesday.

The trio will pay around A$450,000 (£243,000) as part of a A$675,000 (£375,000) share placing and will also provide convertible loan notes, eventually taking their total investment to A$1.825m (£990,000).

Mr le Roux is named as a “major investor” and will replace building company boss Graham Donaldson as Scotgold’s biggest private backer.

Tuesday’s market update also revealed that residents stand to profit from gold and silver bars to be sold on-site at Cononish.

Scotgold said public interest groups, including Strathfillan Community Development Trust, would hold a 20% stake in a new company specifically established to market a proportion of the mine’s produce in the form of dore bars.

The precious metal, branded as Scottish gold and silver, will be sold to the new entity for a 10% mark-up, with Scotgold and the new investors sharing the remaining 80% interest in the enterprise.

Scotgold executive chairman John Bentley said the company was “very pleased” to share its spoils.

He said the arrangement would “particularly benefit the local community, who have been amongst our most loyal and patient supporters” but also revealed the backing would help his company attract the rest of the start-up capital it needs.

“This transaction enables Scotgold to rapidly progress towards the point at which the full development financing can be sought,” he said.

“The board is delighted that investors of the calibre of Nat le Roux see the potential in the development of Scotland’s first commercial gold mine.”

Mr le Roux, who now holds a 7.8% stake in Scotgold, while Mr Harris controls 4.2% of the company, said he stood squarely behind plans for the Tyndrum prospect, which has been significantly delayed and reduced in scope since the recent collapse in the gold price.

“I fully support Scotgold management’s plan to bring the Cononish mine into production within the next 18 months,” he said.