Information regarding the review of the Australian Guidelines for the Estimation and Classification of Coal Resources (coal guidelines) has been previously posted on this forum and the AIG web site. A consultation draft is available for public comment until 7 May.
Are the continued use of the guidelines either necessary or beneficial?
The coal guidelines, arguably, have been made redundant by improvements in the transparency and materiality of public statements of exploration results, resources and reserves in JORC 2012 which provides a uniform basis for disclosure of relevant information for all commodities.
Its difficult to see any aspect of coal exploration result, resource or reserves reporting that requires the imposition of commodity specific provisions.
There are no comparable, specific provisions contemplated for other commodities.
Australian companies, investors and resource and reserve practitioners would benefit from a single, comprehensive standard for exploration result, resource and reserve reporting that JORC 2012 provides.
The proposition that the guidelines are required to establish a definition for Inventory Coal difficult to justify as being either critical or beneficial. Inventory coal cannot be reported publicly. It is estimated for internal company purposes (where companies will have suitable internal classification and reporting standards) and for non-public reporting to governments where the individual authorities involved should set required standards.
The recommended maximum spacings for points of observation applicable to different resource and reserve categories specified in the guidelines are arbitrary, have been historically misused as standards for resource classification and conflict with the role and responsibilities of Competent Persons to both make and fully justify their decisions in this regard.
The 2012 JORC Code, overall, provides a much improved basis for public reporting that is equally applicable to all commodities and, consequently, provides a consistent standard that Australian industry should embrace.
What’s your view? You can add a comment here or via the AIG Linkedin Group. AIG will be making a submission to the review of the guidelines incorporating feedback received from members.