Mining magnate Michael O’Keeffe backs Peruvian gold minnow
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Former Riversdale Mining boss Michael O’Keeffe is now punting on Peruvian gold, taking a strategic stake in ASX-listed minnow EHR Resources — which is on the verge of drilling in mineral-rich elephant country.
Michael O’Keeffe has a mining and management pedigree that rivals the best in the business.
A former boss at Glencore, he built Riversdale Mining from a tiddler stock into a $4 billion purchase by Rio Tinto back in 2011.
He went on to merge ASX-listed Mamba Minerals with Canada’s Champion Iron Mines to create Champion Iron — now valued at $383 million.
After pocketing a cool $66 million from the Riversdale sale, most people would probably look to retire and put their feet up.
But O’Keeffe isn’t one to rest on his laurels.
He’s now emerged as the biggest shareholder in recently listed, Peru-focused minnow EHR Resources (ASX:EHX).
EHR began trading on the ASX earlier this month following a reverse takeover of Cott Oil and Gas.
The company raised $2 million at 7c per share as part of its re-listing and has acquired a 25 per cent stake in the La Victoria gold-silver project in Peru from TSX-V and Frankfurt-listed Eloro Resources.
O’Keeffe, who owns more than 12 per cent of EHR and is a non-executive director, clearly sees something special in La Victoria which is located slap-bang in the middle of the Peruvian gold belt.
Despite neighbouring some of the biggest and lowest-cost gold mines in the world — including Newmont Mining’s Yanacocha mine (24.8 million ounce gold production at $US772 an ounce cash cost) and Barrick Gold’s Lagunas Norte mine (7.48Moz production at cash cost of $US415 an ounce) — the project has never been drilled.
That is set to change with EHR gearing up for stage one drilling of priority targets within the Rufina and San Markito tenements.
The company expects The Peruvian government to grant the drilling permit for Rufina in coming days.
Shares in EHR were trading at 9.3c in intraday trade on Wednesday, giving the company a market cap of just under $10 million.
With $5.75 million in cash after paying $450,000 as an initial consideration for its interest in La Victoria, EHR’s enterprise value is modest at just under $4 million.