SCOTLAND'S first commercial gold producer has announced that "substantial progress" has been made towards mining more than 20,000 ounces of gold a year.

Scotgold said it expects to make a "significant step change" in production at its Cononish mine.

The company predicts it will now produce more gold in the fourth quarter compared to the same period last year.

It comes after it produced 2004 ounces of gold in the three months to September 30.

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In quarter three, the firm produced 314 tonnes of gold concentrate shipments with a sale value of £3.4 million.

In the nine months to September 30, 2022, gold concentrate shipments totalled 729 tonnes with a sales value of £9.7m.

ScotGold reported gold production of 6759 ounces in the nine months to September 30.

The company said that underground power and ventilation upgrades at the site will improve access and increase mining rate and ore extraction.

The company said it is now on track to deliver the second phase of its production at Cononish with a rate of 23500 ounces per year.

Scotgold Resources CEO Phil Day said: “Q3 2022 has been another period of substantial progress as we continue to implement optimisation initiatives across our underground mining operation and processing plant to ramp up towards ‘Phase 2/Full’ production at Cononish in 2023.

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“Q4 2022 production is anticipated to be ahead of Q2/Q3 2022 production levels, and I believe the quarter will mark a significant step change as we progress towards a processing rate of 5000 [tonnes per calendar month], equating to an annualised production of 20,000 ounces of gold per annum run rate."

He said the "uniqueness of Cononish’s orebody" makes Scotgold one of the highest margin, lowest cost gold producers in the world. 

Day continued: "This, coupled with our exploration opportunity in Scotland, I believe ideally places us for growth.

"I look forward to reporting on production, operational progress and further revenue generation into the New Year.”