Scotgold Resources Share Discussion Threads

[pr100] 03/5/2018 11:40

How about these useless directors showing faith and buying some of these sad shares? They don't deserve zero-risk/free-money warrants for missing targets and trashing the share price if this mine takes another decade to get into production. Whose bright idea was it to imply that it could feasibly take that long?

[glenalmond] 19/4/2018 08:49

GAL down 9% at a three month low this morning.

[glenalmond] 17/4/2018 14:31

proactiveinvestors.co.uk/companies/stocktube/9059/galantas-gold-secures-additional-finance-to-advance-omagh-mine-9059.html

[glenalmond] 17/4/2018 14:30

It's not affected GALs share price or volumes at all.

[...]

[mineng] 16/4/2018 12:31

Offtake financing deal between Ocean and GAL : Will SGZ follow this path to part finance Cononish?

[vfb1888] 31/3/2018 12:17

Oh Shylock , lol
Fair Play to you still working over the Easter weekend , lol you must need that bonus real bad it's a shame you will never see it .
Happy Easter NUMPTY , bet your all clean down there now !lol

[pr100] 31/3/2018 10:22

For those who don't understand how a Section 75 legal agreement/financial guarantee works, the planning board report explains:

"It is normal practice for applications relating to the extraction of minerals that a financial guarantee be provided. A financial guarantee provides assurances relating to the full restoration and aftercare of the site should the mineral operator fail to carry out their obligations i.e. as a result of a breach of planning control or in the event of them going into liquidation. The applicant proposes to provide the bond through a Cash Collateral Account. This essentially means that the bond amount would be credited to an account that shall be held by a bank to the order of the NPA."



Obviously, most of the cash must be deposited up front so that the contracted works can still be carried out even if Scotgold go bust. The previous PP stated clearly that The bonds were "required to be in place prior to the commencement of development on site" and while Scotgold are presumably trying to haggle over this, they won't get far because they can't guarantee that they won't go bust or stop trading at any point in time - even next month.

And just for clarity, the figures I quoted in my 3338 post are not totals but minimums and these minimums, when agreed, will logically be added to the initial bond before development work can start. The actual annual payments out of the escrow account would total considerably more if the development continued for 16 years.

While provisional agreements have been reached on the £503,521 financial security for the restoration and aftercare of the site and the £282,000 financial security for the GCGMP (albeit the final amounts are still to be determined), the board report states clearly what negotiations are ongoing:

"To date, negotiations have not reached provisional agreement on the following matters:
a) Confirmation of the type of bond arrangement;
b) The proposed funding for a planning compliance officer to monitor the development. Previously an amount was agreed to be funded by the applicant, this is again proposed – as is appropriate, but hasn’t been concluded; and
c) Finalising the terms of the applicant’s financial contribution to Visitor Experience and Conservation projects in the National Park."

No doubt Scotgold would love to pay the bond in annual instalments but sadly that would not provide the required security against the company becoming unable or unwilling to see the project through. In planning determinations, it is routine to secure all the guaranteed funds pre-build and the previous PP sets a clear precedent which can't logically be changed.

[vfb1888] 29/3/2018 16:47

Hi Shylock,
Boys are still working way , lol
AND they are on BONUS to finish the job ahead of schedule ! lol

[pr100] 29/3/2018 08:57

By the way, the planning board report makes it clear that the mine legal agreement will be with SGZ Cononish Ltd - a company which Scotgold still hasn't told its shareholders anything about, nor even listed it as a subsidiary in any financial report since it was formed.

Why would it not want to tell shareholders about it?

[pr100] 28/3/2018 16:59

Wee Graham, you need to understand the difference between "preparatory works" and "development works". Mine development works are not under way. What is going on is "permitted and modest earthworks" (see interims) which are clearly separate from the mine plan.

Work on the mine development cannot begin until planning permission has been granted - and that won't happen until Scotgold agree financial terms and hand over the money. Only then will Scotgold be committed to this project - and only then will they be able to secure external funding, if there is any to be had.

[vfb1888] 28/3/2018 15:37

Shylock , lol
The boys are already working.
Yet again you show yourself to be ill informed and out of touch.
Bye Bye bonus bye bye

[pr100] 28/3/2018 12:47

So, while the rare mini-spike in the share price dissipates due to a almost total lack of interest in SGZ shares, why are Scotgold not rushing to comply with the legal conditions which have to be met before planning permission is ratified? They were never able (or willing) to comply with the financial conditions attached to the previous planning approval so is this another chicken-and-egg scenario whereby Scotgold won't commit to the financial undertakings until/unless they can raise the balance of the funding? But with external funding unlikely without full PP being granted, that would be a never-ending circle.

The legal conditions attached to the new provisional PP are:

Appendix 2 Proposed Heads of Terms for Planning Obligation/Section 75 legal agreement
Prior to a grant of planning consent the applicant must enter into a legal agreement which secures the following matters:
1. Financial Guarantees:
a) A financial guarantee sufficient to allow the National Park Authority to enter and restore the site to a satisfactory standard at any stage of the development when the operator has failed to meet defined obligations or has abandoned the site.
b) A financial guarantee sufficient to allow the National Park to prepare and implement the Greater Cononish Glen Management Plan (GCGMP) should the developer fail to do so.
2. GCGMP: The preparation and implementation of a Greater Cononish Glen Management Plan to cover a 30 year period.
3. Financial Contribution: Developer contributions towards projects which enhance conservation and visitor experience in the National Park.
4. Planning Monitoring Officer: Developer contributions towards the National Park Authority’s costs incurred in monitoring the development.


A clue as to how much cash Scotgold would have to deposit in escrow before PP is formalised comes in the report of the board meeting on 27 February:


Restoration bond: £503,521 (proposed by Scotgold, subject to ongoing negotiation)
30-year Greater Cononish Glen Management Plan: £282,000 (ditto)
Additional contributions which may be built into the bond:
£250k minimum to enhancing conservation and visitor experience in the NP
£TBA cost of employing Planning Monitoring Officer (was £117k for previous PP)

So, it's looking like £1m-1.5m in cash will need to be ring-fenced in escrow before we can get formal PP, without which the mine is obviously not going to secure any external financing.

Has Scotgold raised enough cash to cover this and allow for preliminary site development? Presumably not but the development work anyway won't start until full PP is granted so urgent step 1 must be to agree the cash contributions and hand the money over. A month should be long enough for haggling.

As was the case with the previous PP, Scotgold are not committed to this project until they do hand the cash over so it's time to step up to the plate before another year is wasted.

Be prepared for further interim fundraisings too - notwithstanding Scotgold's assurances to the contrary, which weren't worth the paper they were written on last time.

[pr100] 20/3/2018 08:46

However, Mr Market wholeheartedly concurs with me.

[pr100] 20/3/2018 08:44

Confidence in the project would be not securing the loan on all Scotgold's assets.

As a consequence of NLR's fixed/floating charge, minority shareholders have zero asset backing to provide some security for their investment.

[glenalmond] 20/3/2018 08:44

I wholeheartedly concur with vfb1888.

Will someone pull the chain again please? There's something that needs flushing away ... & it ain't Richard - although it does rhyme with "third".

[vfb1888] 20/3/2018 07:31

I say , well done that man !

"Nat le Roux's continued support and confidence in our Project is amply demonstrated by his willingness to forgo all interest due on the loan, which can now be applied for the benefit of all shareholders."

Hey Shylock , why don't you as a shareholder write a letter and say thank you ?
After all your share of that interest must be at least 1p , Baz you needn't bother but then again when did that ever stop you.

Pair of prize Numpty's

I wonder if they will lose interest now , lol

[pr100] 20/3/2018 07:26

Too little, too late. The NLR loan was always extortionate. But hopefully there's more to come from the new Nomad. Maybe they could find us a capable, compliant, straight-talking CEO to replace the current liability.

[glenalmond] 19/3/2018 20:30

Nice one Hyper, thanks. I thought it might be interesting to see what traffic's passing through.

Aus, Spain & Jersey - as well as us Brits, thus far.

Thanks also to TLC7 on LSE for pointing out

[steelwatch] 19/3/2018 09:26

Cheers Hyper. Another smart move announced today 8-)

[glenalmond] 19/3/2018 00:13

That's the one Steely, thanks :)