Kirkland Lake chair backs Pilbara gold rush

Eric Sprott presents at the Precious Metals Investment Symposium in Melbourne

Kirkland Lake Gold chairman Eric Sprott expects to have a better idea of how real the escalating Pilbara gold rush is in the next three months.

Canada’s Kirkland Lake spent $C56 million ($56.6 million) to acquire an 18.2 per cent stake in Canadian-listed explorer Novo Resources in September, giving it exposure to promising gold assets in the region, including the 1800-square-kilometre Pilbara Paleoplacer gold project.

The company, which owns the high-grade Fosterville gold mine in Victoria, then added to its interest in the Pilbara a month later with a $5 million investment in another of the region’s explorers, De Grey Mining.

As Kirkland Lake made these investments, a series of exploration results from junior companies has spiked interest in the region as their announcements outlined the potential for significant conglomerate-hosted discoveries.

Sprott, who also personally owns around 12 per cent of Novo, believes the opportunity in the Pilbara for gold companies and investors has become special.

From Novo’s perspective, however, he said it would likely be known in the next three months if it was on to the “real thing”.

“I think we will have assays by then,” the Canadian businessman said on the sidelines of the Precious Metals Investment Symposium in Melbourne today.

“We will have drilled some of those big diameter holes, we will have results, and the results will tell us what the conglomerate looks like.

“The only questions then will be how expansive is the conglomerate and yes there will be places where I’m sure the grade will be higher than other places.”

In addition to his stake in Novo, Sprott personally invested $5 million in another Pilbara gold explorer, Kairos Minerals, during October.

With Novo, De Grey, Kairos and others exploring across such a large area of the Pilbara, Sprott is certain that success will come out of the region – it is just a matter of how much success.

“Everyone is going to have a discovery theoretically,” Sprott said. “You have an area that is 200km by 100km. There will be all sorts of guys with discoveries – there is just no question about it.”

Even today, the positive exploration news from the Pilbara has continued, with Kairos announcing it identified prospective conglomerates at its Croydon project.

Kairos said it identified four previously unmapped conglomerate targets over a 10km strike length from exploration assisted by a helicopter.

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