Billionaire Eric Sprott Builds Position In Gold Mine

Now having lots of acreage doesn’t necessarily mean it’s all ripe with nuggets of gold just waiting to be picked up, but in Kerr Mines (TSX: KER) (OTC: KERMF)’s case, its damn near that rich – and WAY UNDERVALUED in share price, which we’ll explain further on.

The [property] is fully-permitted with extensive infrastructure in place, meaning Kerr Mines has a 450 ton-per-day mill already onsite and the tunnels going down to the high-grade gold ore are already there.

Now to its ore bodies.

There are 942,000 ton of Measured and Indicated gold ore with a grade of 10.3 grams per ton. That’s some high-grade gold!!! On the Inferred side, there are another 335,000 ton with a grade of 12.2 grams per ton. That’s in the soon-to-be further explored “South Zone”, which has GREAT POTENTIAL TO EXTEND THAT ORE BODY. But in the Proven and Probably category, Kerr Mines (TSX: KER) (OTC: KERMF) has 910,000 ton with an average grade of 8.8 grams per ton. So, what does that spell? MONEY, BABY…. MONEY!!. Now you can see why the great Eric Sprott got his checkbook out and bought into the project.

There are many factors that determine the value of a mine. The grade of gold is obviously first in determining an investment into a gold stock like Kerr Mines. But with such HIGH GRADES of gold, from Proven, Measured and Indicated to Inferred, the numbers are OFF THE CHARTS.

So, is Kerr Mines a takeover target? Perhaps, but not from the likes of the majors, like Barrick Gold (NYSE: ABX), Newmont (NYSE: NEM), or GoldCorp (NYSE: GG). Why? Too small… but with Kerr permitted with a mill in place and the tunnels opened up to access the three zones previous not mined and the heavy hit Kerr Mines (TSX: KER) (OTC:KERMF) discovered in the South Zone, its most likely going to be in production next year. In fact, the feasibility study needed to go into production is expected in the fourth quarter of this year. So that tells us that Kerr Mines intends to go into production.

- Source, Financials Trend