The growing influence of the Committee for Mineral Reserves International Reporting Standards (CRIRSCO) in mining resource disclosure, the membership by most of the critical mining and finance countries around the world and the clear movement to common disclosure requirements by regulators will only continue to grow. There are already a number of codes around the world, such as the Canadian Institute of Mining Metallurgy and Petroleum (CIM) – of which certain definition standards are law in Canada by virtue of National Instrument 43-101 (NI 43-101); the Joint Ore Reserves Committee (JORC) in Australasia; the South African Code for the Reporting of Exploration Results, Mineral Resources and Mineral Reserves (SAMREC) in South Africa; Industry Guide 7 in the United States, which is moving towards accepting CRIRSCO definitions; NAEN in Russia; and the Pan-European Reserves and Resources Reporting Committee (PERC)in Europe.
Most mining companies are listed in Canada and the United States, and the rules apply to such issuers already, with US changes in the works. On 31 October 2018, the United States Securities and Exchange Commission (SEC) announced new rules to modernise property disclosures required for mining registrants, to become effective for their first fiscal year on or after 1 January 2021.
This chapter will also cover how regulators accept and adopt policies for qualified and competent persons, etc. As we note under NI 43-101, more organisations are now being recognised as having their members accepted as qualified persons.
Modern day rules for resource disclosure in the mining industry owe their advent to the Poseidon bubble, which was triggered by the company Poseidon NL’s discovery of a nickel deposit in western Australia, in September 1969. At that time, Poseidon shares had been trading at A$0.80 each, and peaked at A$280 each in February 1970.
As a result, the Australian government established the ‘Rae Committee’, which, in 1974, recommended changes to the regulation of stock markets, leading to Australian securities legislation. Ironically, the deposit subsequently became a mine, which operated for a number of years.
JORC was established in 1971 and was sponsored by the Australian mining industry. It comprises representatives of the Mineral Council of Australia, the Australasian Institute of Mining and Metallurgy, and the Australian Institute of Geoscientists, as well as representatives of the Australian Stock Exchange, the Financial Services Institute of Australasia and the accounting profession. The JORC Code was imposed as a mandatory system for the classification of minerals, exploration results, mineral resources and ore reserves according to the level of confidence in the geological knowledge of the area – and that gained from a specific investigation – and technical and economical considerations for public reporting. The JORC Code was first published in 1989 and is incorporated in the listing rules of the Australian and New Zealand stock exchanges. The JORC Code was the first code that set out in detail the requirements for disclosure on mining properties, and forms the genesis for a number of codes that have adopted its concepts in countries around the world.
Scandals in the mining industry are not, however, limited to the Poseidon bubble. Another significant scandal concerns Bre-X Minerals Ltd, a Canadian company that allegedly discovered the Busang gold deposit.
Bre-X started out on the Alberta Stock Exchange and was listed in 1989 at C$0.30 a share. In October 1995, Bre-X announced it had discovered a deposit with approximately 2.7 million ounces of gold. Analysts believed the find might have 30 million ounces, and John Felderhof, a company geologist, stated in October 1995 that it could be 45 million ounces with ‘the potential of becoming one of the world’s great ore bodies’.2 Michael De Guzman, a Filipino geologist, hinted at 100 million ounces, and, in March 1996, the shares were listed on the Toronto Stock Exchange (TSX). There were numerous interference activities by the Indonesian government. In March 1997, De Guzman disappeared after falling from a helicopter. In February 1997, Freeport-McMoRan Copper and Gold Inc, a US company, negotiated an agreement respecting the property, and announced in late 1997 that there were ‘insignificant amounts of gold’ at the Busang deposit. Bre-X’s market capitalisation had already collapsed by C$3 billion.
As a result of the Bre-X debacle, the Mining Standards Task Force was established by the TSX and the Ontario Securities Commission, and it recommended sweeping changes to disclosure for mining companies listed on exchanges in Canada. Unlike Poseidon, which had nickel, Bre-X had no gold other than the nearby placer gold that was used to salt the drill core samples.
The Canadian Securities Administrators (CSA) established NI 43-101 (or the Standards of Disclosure for Mineral Projects), together with the Companion Policy and the F1 Form, which meant that all reporting mining companies in Canada would be subject to the provisions of NI 43-101 in addition to any disclosure requirements required by the relevant exchange.
Notice was given on 3 July 1998, and NI 43-101 came into effect on 14 November 2000. NI 43-101 incorporated, as part of the law, CIM definition standards for mineral resources and mineral reserves. Since 2000, there have been a number of changes made to NI 43-101, as well as notices relating to disclosure under it. In addition, the CIM published guidelines for diamond exploration and lithium brines. Prior to NI 43-101, the Geological Survey of Canada published Paper 88-21, which dealt with disclosure for coal properties, including a category for ‘speculative’ resources; however, this category is not accepted by regulators.
In the United States, the SEC has Industry Guide 7 regarding disclosure for mining companies.
Partly owing to the implementation of the JORC Code and NI 43-101, various exchanges3 also implemented their own disclosure rules. The pathway to today’s disclosure is beginning to converge, perhaps as a result of the establishment of CRIRSCO. It comprises organisations around the world with mining as their focus, and much of the current disclosure in the industry is derived from CRIRSCO standard definitions.
The JORC Code introduced the concept of a ‘competent person’, and NI 43-101 adopted a similar definition in ‘qualified person’.
CRIRSCO has a number of defined terms, including ‘inferred resource’, ‘indicated resource’, ‘measured resource’, ‘probable reserve’ and ‘proved reserve’, which closely correspond to CIM definitions, although there is some difference in the definition of inferred resource. In addition, CRIRSCO defines a ‘scoping study’, a ‘pre-feasibility study’ and a ‘feasibility study’. The scoping study is similar to the ‘preliminary economic assessment’ (PEA) as set out NI 43-101. PEA is not a defined term under CIM definitions but is a creature of NI 43-101 itself.
In June 2016, the SEC announced proposed rules to modernise the disclosure requirements for mining companies in order to align them with industry and global regulatory practices and standards. The proposed rules were, for the most part, in keeping with industry standards, with the exception of certain areas where the requirements for disclosure such as ‘grades’ and ‘recoveries’ at various development stages of mining4 would also be required for reporting. From a technical perspective, some of these concepts would be extremely difficult to determine in advance.
As a result of the proposed SEC rule, the Society for Mining, Metallurgy & Exploration (SME) in the United States proposed, in July 2017, the ‘SME Guide for Reporting Exploration Results, Mineral Resources and Mineral Reserves’.5 It is a comprehensive document and provides significant guidance with respect to mining disclosure. However, the SME guide is not law. Industry Guide 7, which only permits disclosure of proven reserves, is the law in the United States, although companies, such as those in Canada with joint trading in Canada and the United States, can disclose NI 43-101 information such as resources, provided cautionary language is used.
Other organisations have created reporting committees, such as PERC and SAMREC – which last published its code in 2016.
In addition, the Comissão Brasileira de Recursos e Reservas (CBRR) published the ‘CBRR Guide for Reporting Exploration Results, Mineral Resources and Mineral Reserves’ – the latest edition being in 2016.
In Chile in 2015, the Comisión Calificadora de Competencias en Recursos y Reservas Mineras (the Mining Commission) published the ‘Code for Reporting of Exploration Results, Mineral Resources and Mineral Reserves’, with government and industry input.
Other countries have also published codes, including Russia – the NAEN Code ‘For the Public Reporting of Exploration Results, Mineral Resources and Mineral Reserves’ in October 2011. There is more than one Russian code; however, the only code accepted by CRIRSCO is the NAEN Code.
Kazakhstan published ‘A Code for the Public Reporting of Exploration Results, Mineral Resources and Mineral Reserves’ in June 2016.
Mongolia published ‘A Code for the Public Reporting of Exploration Results, Mineral Resources and Mineral Reserves’ in 2014.
Many of these codes have adopted the CRIRSCO definitions with some changes to accommodate local activities and mining operations.
There are other regulatory schemes that affect the industry, including the rules of the HKEX under Chapter 18, which adopted the CIMVal Standards and Guidelines for the Valuation of Mineral Properties endorsed by the CIM in February 2003.
The Singapore Exchange has disclosure requirements for mineral, oil and gas companies in Practice Note 6.3.
The Johannesburg Stock Exchange sets out disclosure requirements for mineral companies in section 12 of its rules.
The Australian Securities Exchange, in its listing rules under Chapter 5, sets out requirements for additional reporting in mining, oil and gas production and exploration activities, and the Australian Securities and Investments Commission provides a ‘perspective on resources and reserves reporting’, which was last revised in April 2013.
In Europe, the London Stock Exchange has a note for mining, and oil and gas companies dated June 2009 under the AIM6 listing requirements. The London Stock Exchange adopts the AIM Guidance.
The TSX has its ‘Disclosure Standards for Companies Engaged in Mineral Exploration, Development and Production’, as set out in Appendix B of its company manual. The TSX and the TSXV also have listing requirements for exploration and mining companies.
In the United Kingdom, in January 2018, the Financial Conduct Authority published listing rules regarding mining companies.
The European Securities and Markets Authority published regulation No. 809/2004 regarding prospectus directives and recommendations. A consultation paper was published in September 2012.
The SEC has Industry Guide 7 dealing with mining company disclosure. Discussions are currently underway with the SEC and industry representatives, including the SME and the National Mining Association with respect to the proposed SEC mining disclosure rules.
CRIRSCO was formed in 1994 under the auspices of the Council of Mining and Metallurgical Institute (CMMI), a group of representatives of organisations that are responsible for contributing and developing mineral reporting codes and guidelines:
- Australasia (JORC);
- Brazil (CBRR);
- Canada (CIM);
- Chile (the Mining Commission for the Qualification of Competitiveness in Mineral Resources and Mineral Reserves);
- Colombia (the Colombian Commission for Natural Resources and Ore Reserves);
- Europe (PERC);
- Indonesia (Komite Bersama – KCMI);
- Kazakhstan (Code for the Public Reporting of Exploration Results, Mineral Resources and Mineral Reserves);
- Mongolia (Mongolian Resource Code);
- Russia (NAEN);
- South Africa (SAMREC);
- Turkey (the National Mining Reserve and Resource Reporting Committee); and
- the United States (SME).
The combined market capitalisation of mining companies listed on the stock exchanges of these countries accounts for a large majority of the listed capital of the mining industry.
The international initiative to standardise market-related reporting definitions for mineral resources and mineral reserves started at the 15th CMMI Congress at Sun City, South Africa in 1994. The mineral definitions working group (later called CRIRSCO) was formed after a meeting at that Congress, and was made up of representatives from most of the countries listed above, with the primary objective to develop a set of international standard definitions for the reporting of mineral resources and mineral reserves.
In 1997, the original five participants reached agreement (the Denver Accord) for the definitions of the two major categories – mineral resources and mineral reserves – and their respective subcategories: measured, indicated and inferred mineral resources, and proved and probable mineral reserves.
In 1999, agreement was reached with the United Nations Economic Commission for Europe, which had, since 1992, been developing an International Framework Classification for Mineral Reserves and Resources (UNFC), incorporating the CMMI CRIRSCO resource and reserve definitions for those categories that were common to both systems, providing international status to the CMMI CRIRSCO definitions.
Following these agreements, an updated version of the JORC Code was released in Australia in 1999 (and more recently in 2012), followed by similar codes and guidelines in South Africa, the United States, Canada, the United Kingdom, Ireland, western Europe, Chile and Peru. The JORC Code has played a significant role in the development of standard definitions for the codes and guidelines.
The similarity of the various national reporting codes and guidelines has enabled CRIRSCO to develop an ‘International Minerals Reporting Code Template’ of ‘core code and guidelines’ for jurisdictions wishing to adopt its own CRIRSCO-style reporting standard, recognising country-specific requirements such as legal and investment regulations.
The following are the standard CRIRSCO terms (as of October 2012) to include in reporting standards of all CRIRSCO members subject to the agreement of the respective national reporting organisations:
- public reports;
- competent person;
- modifying factors;
- exploration target;
- exploration results;
- mineral resource;
- inferred resource;
- indicated resource;
- measured resource;
- mineral reserve;
- probable reserve;
- proved reserve;
- scoping study;
- pre-feasibility study; and
- feasibility study.
These terms have been incorporated in the International Minerals Reporting Code Template of CRIRSCO dated November 2013, and the codes and standards of most CRIRSCO members.
General relationship between exploration results, mineral resources and mineral reserves
The following information is edited primarily from the CRIRSCO website.
Public reports are reports prepared informing the public on exploration results, resources or reserves in documents such as annual and quarterly company reports, press releases, technical papers, websites and presentations.
A competent person is a minerals industry professional with membership in an organisation having the power to discipline members. Similar terms exist such as in Canada (qualified person) and Chile (qualified competent person), including requirements of five years’ minimum relevant experience in the mineralisation or deposit type under consideration.
Modifying factors commonly applied include converting resources to reserves in such areas as the following:
- social; and
- governmental, such as:
- exploration targets; and
- estimates of the exploration potential of a mining deposit in a known geological setting – stating a range of tonnes, and a range of grade or quality of mineralisation for which there has been insufficient exploration to estimate mineral resources.
This is akin to disclosure on ranges as set out in section 2.3(2) of NI 43-101.
Exploration results include data and information generated by exploration programmes, but do not form part of a declaration of mineral resources or mineral reserves.
CIM definition standards
These definitions are excerpted from the CIM Standing Committee on Reserve Definitions of 10 May 2014.
A pre-feasibility study is a comprehensive study of a range of options for the technical and economic viability of a mineral project that has advanced to a stage where a preferred mining method, in the case of underground mining – or the pit configuration, in the case of an open pit – is established, and an effective method of mineral processing is determined. It includes a financial analysis based on reasonable assumptions on the modifying factors, and the evaluation of any other relevant factors that are sufficient for a qualified person, acting reasonably, to determine if all or part of the mineral resource may be converted to a mineral reserve at the time of reporting. A pre-feasibility study is at a lower confidence level than a feasibility study.
A feasibility study is a comprehensive technical and economic study of the selected development option for a mineral project, which includes appropriately detailed assessments of applicable modifying factors together with any other relevant operational factors and detailed financial analyses that are necessary to demonstrate, at the time of reporting, that extraction is reasonably justified (economically mineable). The results of the study may reasonably serve as the basis for a final decision by a proponent or financial institution to proceed with, or finance, the development of the project.
A mineral resource is a concentration or occurrence of solid material of economic interest in or on the Earth’s crust in such form, grade or quality – and quantity – that there are reasonable prospects for eventual economic extraction.
The location, quantity, grade or quality, continuity and other geological characteristics of a mineral resource are known, estimated or interpreted from specific geological evidence and knowledge, including sampling.
Inferred mineral resource
An inferred mineral resource is that part of a mineral resource for which quantity, and grade or quality are estimated on the basis of limited geological evidence and sampling. Geological evidence is sufficient to imply but not verify geological grade or quality continuity.
An inferred mineral resource has a lower level of confidence than that applying to an indicated mineral resource and must not be converted to a mineral reserve. It is reasonably expected that the majority of inferred mineral resources could be upgraded to indicated mineral resources with continued exploration.
Indicated mineral resource
An indicated mineral resource is that part of a mineral resource for which quantity, grade or quality, densities, shape and physical characteristics are estimated with sufficient confidence to allow the application of modifying factors in sufficient detail to support mine planning and evaluation of the economic viability of the deposit.
Geological evidence is derived from adequately detailed and reliable exploration, sampling and testing, and is sufficient to assume geological grade or quality continuity between points of observation.
An indicated mineral resource has a lower level of confidence than that applying to a measured mineral resource and may only be converted to a probable mineral reserve.
Measured mineral resource
A measured mineral resource is that part of a mineral resource for which quantity, grade or quality, densities, shape and physical characteristics are estimated with confidence sufficient to allow the application of modifying factors to support detailed mine planning and final evaluation of the economic viability of the deposit.
Geological evidence is derived from detailed and reliable exploration, sampling and testing, and is sufficient to confirm geological grade or quality continuity between points of observation.
A measured mineral resource has a higher level of confidence than that applying to either an indicated mineral resource or an inferred mineral resource. It may be converted to a proven mineral reserve or a probable mineral reserve.
Modifying factors are considerations used to convert mineral resources to mineral reserves. These include, but are not restricted to, mining, processing, metallurgical, infrastructure, economic, marketing, legal, environmental, social and governmental factors.
A mineral reserve is the economically mineable part of a measured or indicated mineral resource. It includes diluting materials and allowances for losses, which may occur when the material is mined or extracted, and is defined by studies at pre-feasibility or feasibility level, as appropriate, which include the application of modifying factors. Such studies demonstrate that, at the time of reporting, extraction could reasonably be justified.
The reference point at which mineral reserves are defined, usually the point where the ore is delivered to the processing plant, must be stated. It is important that, in all situations where the reference point is different, such as for a saleable product, a clarifying statement is included to ensure that the reader is fully informed as to what is being reported.
The public disclosure of a mineral reserve must be demonstrated by a pre-feasibility or feasibility study.
Probable mineral reserve
A probable mineral reserve is the economically mineable part of an indicated and, in some circumstances, a measured mineral resource. The confidence in the modifying factors applying to a probable mineral reserve is lower than that applying to a proven mineral reserve.
Proven (proved) mineral reserve
A proven mineral reserve is the economically mineable part of a measured mineral resource. A proven mineral reserve implies a high degree of confidence in the modifying factors.
There are also guidelines for the reporting of coal reserves, industrial minerals, diamonds and gemstones.
In Canada, the CSA has NI 43-101 together with its Companion Policy and the F1 Form, which must be followed when reporting results.
Several definitions in NI 43-101, which are somewhat unique, are summarised below.
Preliminary economic assessment
A preliminary economic assessment is a study, other than a pre-feasibility or feasibility study, that includes an economic analysis of the potential viability of mineral resources. This is similar to a scoping study.
A qualified person:
- is an individual who is an engineer or geoscientist with a university degree or equivalent accreditation, in an area of geoscience or engineering relating to mineral exploration or mining;
- has at least five years of experience in mineral exploration, mine development or operation, or mineral project assessment relevant to the professional degree or area of practice;
- has experience relevant to the subject matter;
- is in good standing with a professional association;
- in the case of a professional association in a foreign jurisdiction, has a membership designation that requires attainment of a position or responsibility in his or her profession that requires the exercise of independent judgement;
- is required to have a favourable confidential peer evaluation of the individual’s character, professional judgement, experience and ethical fitness, or a recommendation for membership by at least two peers; and
- demonstrates prominence or expertise in the field of mineral exploration or mining.
An issuer may disclose in writing the potential quantity and grade, expressed as ranges, of a target for further exploration, if the disclosure as follows:
- states with equal prominence that the potential quantity and grade is conceptual in nature, that there has been insufficient exploration to define a mineral resource and that it is uncertain if further exploration will result in the target being delineated as a mineral resource; and
- states the basis on which the disclosed potential quantity and grade has been determined.
There are instructions in the F1 Form (the technical report) that, together with the Companion Policy, provide guidance on technical disclosure.
Contents of the technical report include:
- title page;
- date and signature page; and
- table of contents – including figures and illustrations, such as maps, plans and sections.
Requirements for all technical reports (note that this is an edited description and should not be relied upon for report preparation, and is only provided as an example of what a technical report for mining disclosure may ultimately resemble):
- Summary – briefly summarise important information in the technical report, including property description and ownership, geology and mineralisation, status of exploration, development and operations, mineral resource and mineral reserve estimates, and the qualified person’s conclusions and recommendations.
- Introduction – include a description of the issuer for whom the technical report is prepared; terms of reference and purpose; sources of information and data; and details of the personal inspection by a qualified person.
- Reliance on other experts – the qualified person who prepares or supervises preparation of all or part of the technical report may include a limited disclaimer of responsibility for matters concerning legal, political, environmental or tax matters relevant to the report.
- Property description and location – area of property; location; types of mineral tenure (and identifying name or number of each); the nature and extent of the issuer’s title to, or interest in, property rights, access, obligations that must be met to retain property, expiration date of claims, licences or other property tenure rights; to the extent known, terms of any royalties, back-in rights, payments, or other agreements and encumbrances to which property is subject; to the extent known, all environmental liabilities affecting property; to the extent known, permits; and any other significant factors and risks that may affect access, title, or right or ability to perform work on the property.
- Accessibility, climate, local resources, infrastructure and physiography – topography, elevation and vegetation; access; proximity to a population centre – and of transport; climate and length of operating season; and sufficiency of surface rights for mining operations, availability and sources of power, water, mining personnel, potential tailings storage areas, potential waste disposal areas, heap leach pad areas and potential processing plant sites.
- History – prior ownership of property and ownership changes; type, amount, quantity and general results of exploration and development work undertaken by previous owners or operators; any significant historical mineral resource and mineral reserve estimates; and any production from property.
- Geological setting and mineralisation – regional, local and property geology; and significant mineralised zones.
- Deposit types – mineral deposit types being investigated or explored for; and the geological model or concepts on whose basis the exploration programme is planned.
- Exploration – nature and extent of all relevant exploration work other than drilling, conducted by, or on behalf of, the issuer, including procedures and parameters relating to surveys and investigations; sampling methods and sample quality, whether samples are representative and any sample bias factors; information of location, number, type, nature, spacing or density of samples collected and size of area covered; and significant results and interpretation of exploration information.
- Drilling – type and extent of drilling, a summary and interpretation of all relevant results; any drilling, sampling or recovery factors that could materially impact accuracy and reliability of results; for a property other than an advanced property (i) location, azimuth and dip of any drill hole, and depth of relevant sample intervals; (ii) relationship between sample length and true thickness of mineralisation, orientation of mineralisation; and (iii) results of any significantly higher grade intervals within a lower grade intersection.
- Sample preparation, analyses and security – sample preparation methods and quality control measures; relevant information regarding sample preparation, assaying and analytical procedures used, and name and location of analytical or testing laboratories; summary of nature, extent and results of quality control procedures employed, and quality assurance actions; and opinion on adequacy of sample preparation, security and analytical procedures.
- Data verification – steps taken by the qualified person to verify data in the technical report, including procedures; limitations on or failure to conduct such verification; and the qualified person’s opinion on the adequacy of data.
- Mineral processing and metallurgical testing – if mineral processing or metallurgical testing analyses have been carried out, discuss the nature and extent of testing and analytical procedures and summary; the basis for any assumptions or predictions; the degree to which test samples are representative of various types and styles of mineralisation and mineral deposit; and any processing factors or deleterious elements that could have a significant effect on potential economic extraction.
- Mineral resource estimates – disclosure of mineral resources must provide sufficient discussion of key assumptions, parameters and methods used to estimate mineral resources; comply with all disclosure requirements for mineral resources; when the equivalent grade for a multiple commodity mineral resource is reported, the individual grade of each metal or mineral, and metal prices, recoveries and other relevant conversion factors used to estimate metal or mineral equivalent grade must be reported; and include a general discussion on the extent to which mineral resource estimates could be materially affected by any known environmental, permitting, legal, title, taxation, socio-economic, marketing, political or other relevant factors.
Additional requirements for advanced property technical reports (referencing economic analysis) are as follows:
- Mineral reserve estimates – disclosure of mineral reserves must provide sufficient discussion and detail of key assumptions, parameters and methods used where mineral resources were converted to mineral reserves; for equivalencies, the individual grade of each metal or mineral, and metal prices, recoveries and other relevant conversion factors used; and the extent to which reserve estimates could be materially affected by mining, metallurgical, infrastructure, permitting and other relevant factors.
- Mining methods – current or proposed mining methods and summary of relevant information used to establish amenability, or potential amenability, of mineral resources or mineral reserves of proposed mining methods – include geotechnical, hydrological and other parameters relevant to mine or pit designs and plans; production rates, expected mine life, mining unit dimensions and dilution factors used; requirements for stripping, underground development and backfilling; and required mining fleet and machinery.
- Recovery methods – available information on test or operating results relating to recoverability of the valuable component or commodity, and amenability of mineralisation to proposed processing methods – where relevant, include a description or flow sheet of the current or proposed process plant; plant design, equipment characteristics and specifications, as applicable; and current or projected requirements for energy, water and process materials.
- Project infrastructure – summary of infrastructure and logistic requirements for the project, which could include roads, rail, port facilities, dams, dumps, stockpiles, leach pads, tailings disposal, power and pipelines, as applicable.
- Market studies and contracts:
- Summary of reasonably available information concerning markets for the issuer’s production, including nature and material terms of any agency relationships, commodity price projections, product valuations, market entry strategies or product specification requirements.
- Identify any contracts material to the issuer that are required for property development, including mining, concentrating, smelting, refining, transportation, handling, sales and hedging, and forward sales contracts or arrangements in place or under negotiation, and terms and industry norms.
- Environmental studies, permitting and social or community impact – reasonably available information on environmental, permitting and social or community factors related to project. Consider and, where relevant, include a summary of results of any environmental studies and environmental issues that could materially impact the issuer’s ability to extract resources or reserves; requirements and plans for waste and tailings disposal, site monitoring and water management both during operations and post mine closure; project permitting requirements, the status of any permit applications and post-performance or reclamation bonds; discussion of any potential social or community-related requirements and plans; and discussion of mine closure (remediation and reclamation) requirements and costs.
- Capital and operating costs – summary of capital and operating cost estimates, with major components set out in tabular form.
- Economic analysis – economic analysis for the project, which includes a clear statement of principal assumptions; cash-flow forecasts on an annual basis using reserves or resources and an annual production schedule for the life of project; discussion of net present value, including impact of taxes, internal rate of return and payback period of capital with imputed or actual interest; a summary of taxes, royalties and other government levies or interests applicable to the mineral project or production, and to revenue or income from the mineral project; and sensitivity or other analysis using variants in commodity price, grade, capital and operating costs, or other significant parameters and impact of results.
Requirements for all technical reports:
- Adjacent properties – the report may include relevant information concerning adjacent property if such information was publicly disclosed. Identify the source; and state that its qualified person has been unable to verify information and that information is not necessarily indicative of mineralisation on property that is the subject of the report. The report clearly distinguishes between information from adjacent property and information from property that is the subject of the report; and any historical estimates of mineral resources or mineral reserves are disclosed in accordance with paragraph 2.4(a) of NI 43-101.
- Other relevant data and information – additional information or explanation necessary to make the technical report understandable and not misleading.
- Interpretation and conclusions – summarise relevant results and interpretations of information and analysis being reported on. Discuss any significant risks and uncertainties that could reasonably be expected to affect reliability or confidence in exploration information, resource or reserve estimates, or projected economic outcomes. Discuss any reasonably foreseeable impacts of these risks and uncertainties on the project’s potential economic viability or continued viability. A report concerning exploration information must include conclusions of the qualified person.
- Recommendations – provide particulars of recommended work programmes and breakdown of costs for each phase. If successive phases of work are recommended, each phase must culminate in a decision point and must not apply to more than two phases of work and whether advancing to a subsequent phase is contingent on positive results in previous phase.
- References – include detailed list of all references cited in technical report.
The world of mining disclosure is gradually converging because of the efforts of organisations such as the CRIRSCO, JORC, SAMREC and CIM, the application of regulators such as the CSA, and exchanges such as the AIM, TSX, HKEX, ASX and other emerging exchanges like these in South America and Asia.
In time, it is expected that disclosure will be common and yet still allow for local rules and regulations unique to such jurisdictions.
 Brian E Abraham is a partner at Dentons Canada LLP. The author would like to thank Emily LeDue, articling student at Dentons, for her research assistance.
 Toronto’s The Globe and Mail newspaper, 30 July 2007.
 Including the TSX, TSX Venture Exchange (TSXV), the Hong Kong Stock Exchange (HKEX) and the Australian Stock Exchange.
 Such as ‘the deposit’, ‘prior to processing‘, ‘processing’ and ‘recovery’.
 This document was prepared by the Resources and Reserves Committee of the SME.
 Alternate investment market of the London Stock Exchange.