What makes Gateway so interesting that this rich-lister wanted a piece?
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Mining entrepreneur Kerry Harmanis has topped up his holding in junior gold explorer Gateway Mining (ASX:GML) as part of the recent $2m capital raising.
This will cement his position as the company’s second-biggest holder with a 10 per cent stake.
Harmanis, a former lawyer, is the founder and executive director of Jubilee Mines – a successful gold producer he sold to Swiss mining heavyweight Xstrata in 2007 for $3 billion.
That sale netted him a hefty $500m payday.
Harmanis, who was born in Adelaide to Greek parents, is among Australia’s 200 wealthiest people and has again made it on the AFR’s Financial Review Rich List with a worth of $609m in 2019, according to the Greek City Times.
(The complete Financial Review Rich List is not due out until the end of May.)
Harmanis got into Gateway, which has a market value of about $13.1m at a share price of 1.4c, about a year ago after he took up some of the shortfall from a rights issue.
Gateway managing director Peter Langworthy has known Harmanis since 2003.
“I worked for him at Jubilee Mines and had a lot of success there, and Kerry’s been supportive and he’s generally at another level taken an interest in most things that I’ve been involved in,” he told Stockhead.
“But the one thing he likes always is really fundamentally what the geology looks like.
“With Gateway he recognises an emerging gold system and I think he also has taken a view on the gold price, that it’s going to remain fairly buoyant for the foreseeable future.”
In the past six months, the gold price has gained over 9 per cent to $1,825 an ounce, at one point reaching as high as $1,874 an ounce.
Gateway is advancing its Gidgee gold project in Western Australia.
Historically, the Gidgee region has produced around 1.5 million ounces of gold, including about 150,000 ounces from shallow oxide open pits within Gateway’s Airport Central tenements.
Langworthy said Harmanis also liked the opportunity to get in at the “base level rather than being brought in late in the piece”.
“He understands risk, but for lawyer he’s a very good geologist,” Langworthy said.
“He recognises when the geology is highly prospective, and I think that’s what he really sees with our project at Gidgee.”
Gateway has been focused on uncovering more gold beneath two open pit deposits called “Whistler” and “Montague”.
The company has done that and is now working to deliver a bigger resource estimate, including a maiden resource for the Whistler and Montague deposits.
The recent capital raising will top up Gateway’s coffers to $2.4m, of which 70-75 per cent will go into the ground, Langworthy said.
“Some of the money will go towards expanding those resources and then at the appropriate time we’ll estimate JORC-compliant resources,” he said.
“But probably more importantly, the information we’ve got from that work over the last 12 months is demonstrating to us that they might just be part of a much bigger system along the edge of what we call the Montague granodiorite.
“So the next step is expand Whistler and Montague, report some JORC-compliant resources and then start exploring this big gold system to see if we can really add some big ounces on very quickly.”
JORC refers to the mining industry’s official code for reporting exploration results, mineral resources and ore reserves, managed by the Australasian Joint Ore Reserves Committee.
Gateway aims to deliver an upgraded resource by mid-year.