SCOTGOLD Resources has hailed as an "excellent result" 90% take-up of a proposed A$831,000 (£454,000) rights issue conducted by the miner that has ambitions to dig for gold and silver in Argyll.

The funds have secured Scotgold a loan extension from its banker RMB Resources, giving it time to work up new funding plans after attempts to raise finance for its Cononish project were hit by last year's fall in the gold price.

The company, which is listed on the junior Alternative Investment Market in the UK and in Australia, said it had received acceptances for nearly 86.9 million shares, some 53% of those on offer from eligible shareholders.

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It had also had ­applications for 61.7 million ­additional shares, or 37% of those available.

This meant that it received A$743,000 (£406,000) from the rights issue.

Scotgold executive chairman John Bentley said: "This is an excellent result for the company as the £1.5m loan from RMB Australia Holdings will now be extended through to June 2014.

"Moreover, the funds will enable the company to progress further studies on re-engineering the ­Cononish development project, with a view to materially reducing the upfront capital expenditure whilst also increasing the grade of treated ore by targeting the readily accessible high grade areas of the mine."

Scotgold had extended the deadline for applications for shares from December 23 to December 31.

Scotgold's directors said they intended to place up to a further 17.6m shares from those that were not taken up at a price of 50 cents a share.

"A further announcement will be made in due course regarding the placement of the shortfall shares," the company said.

Scotgold's shares, which have fallen nearly 80% in the last year, slipped 0.02p or 5% to close at 0.45p.

After re-evaluating its approach, Scotgold is now likely to seek £10m in capital to start production at the mine near Tyndrum. This is down from the £25m originally proposed.

Scotgold has struggled to raise funds primarily to a plunge in the gold price.

The revised plan for Cononish is likely to see Scotgold focus on the higher-grade gold deposits initially, to bring in cash, and ­develop alternative processing arrangements. This is likely to require further discussions with the Loch Lomond and the Trossachs National Park planning authority.

Scotgold hopes an alternative scheme could be put together within the next six to eight months.

It would then take an estimated 12 to 18 months to get to production.