Eric Sprott joins Kirkland Lake Gold as chairman

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Eric Sprott has added another chairman title to his resume. Fresh from his long-planned decision to step down as lead portfolio manager of his Sprott Asset Management LP and Sprott Inc., the 70-year-old Mr. Sprott is joining the board of Ontario gold miner Kirkland Lake Gold Inc. and replacing Harry Dobson as chairman. The move is subject to regulatory approval.

"I have a big investment in the company," said Mr. Sprott, who owns 5.3 million Kirkland shares, or seven per cent of the stock, "so it made some sense to get represented on the board." That wasn't possible when he was a portfolio manager at Sprott, "so this opens things up for me to focus on things that I want to spend a little more time on," Mr. Sprott said by phone from Scottsdale, Ariz., where he is vacationing. "I happen to love the prospects for Kirkland Lake."

Kirkland has a lot going for it, says its largest individual shareholder. Its main property is a robust, century-old mine in Northern Ontario – a stable, miner-friendly jurisdiction – whose deeper reserves are yielding ever richer grades as it produces about 150,000 ounces of gold per year, Mr. Sprott said. Then there's the notorious gold bug's longer-term bet on the price of the precious metal: "I was right for about the first 11 years after 2000" that gold would rise in value, "and wrong for the last three years," he said.

But Mr. Sprott, like many gold bugs, has not been edged off his core, bullish thesis: that rising demand in Asia for the product, a hangover from excess selling of reserves by the world's central banks in recent years and currency woes around the world, point to a rebound to record price levels. "I'm very upbeat on the price of gold," he said.

Mr. Sprott's stake in Kirkland, worth about $24-million, is his second-largest equity holding after the 60 million shares he still owns of Sprott Inc, where he is still chairman. But its value pales in comparison to his actual cache of physical gold and silver, which Mr. Sprott says is "way beyond what I have in Kirkland Lake."