Do you have a passion for best practice in public reporting of exploration results, mineral resources and ore reserves? Expressions of interest are sought from Fellows and Members for a vacancy on the Joint Ore Reserves Committee (JORC).
AIG has four representatives on the JORC Committee, responsible for representing the interests of AIG’s membership and, collaboratively contributing to the ongoing development of the JORC Code and education dealing with its application. Other committee members are drawn from the committee’s two other parent bodies, the Australasian Institute of Mining and Metallurgy (AusIMM) and MInerals Council of Australia (MCA). The Australian Securities Exchange (ASX), Australian Securities and Investment Commission (ASIC) and Association of Mining and Exploration Companies (AMEC) are also represented on the committee.
All public statements of exploration results, mineral resources and ore reserves made by ASX- and NZSX-listed companies, and all exploration reports submitted to New Zealand Petroleum and Minerals must be prepared by a Competent Person and comply with the minimum requirements set out by the JORC Code. Compliance with the JORC Code is required of all AIG members in compliance with AIG’s Code of Ethics.
A planned update of the JORC Code has commenced. A range of issues including competence required to be demonstrated by Competent Persons and the need to ensure that inherent risks revealed by the evaluation of exploration and resource evaluation projects at all stages of development are expected to feature in the update. The update will feature an extensive stakeholder consultation project, the results of which will be analysed by committee members in recommending improvements to the code.
Expressions of interest are sought from AIG Fellows and Members able to commit to actively participating in the JORC Code update and subsequent stakeholder information and education work. Interested members should provide a covering letter outlining their interest in participating in the JORC Committee’s work, and a brief curriculum vitae outlining their relevant experience. Interested members should be able to act as a Competent Person, as defined by the 2012 edition of the code.
Expressions of interest are also sought from Graduate Members and Members to help to support the revision of the Code, which is expected to provide a great opportunity to gain experience in the development of important professional practices and policies.
Expressions of interest should be submitted to AIG’s Executive Officer, Lynn Vigar, by email prior to 28 August 2020. Expressions of interest will be considered by the AIG Board which will recommend an applicant for confirmation by the other two JORC parent bodies, ideally at the commitee’s September meeting.
The vacancy has been created by the resignation of Dr Jacqui Coombes (MAIG) from the committee. Dr Coombes has been a strong advocate for exploration and mining geoscientists in her role as an AIG representative, with a very sound knowledge of the needs of investors and regulators interested in the content and standard of public announcements relating to exploration and mining projects.
Sincere thanks are extended to Dr Coombes for her valued service to our profession.
AIG has teamed with DeRisk Geomining Consultants to produce a five-module JORC training course. The first course will be delivered in May 2020. Full details of the course and registration information will be released in the next few days.
Each module will be delivered as two, two-hour, interactive webinars on consecutive days, at times designed to foster both Australian and international participation. The modular structure of the course enables participants to register for the modules that they feel they need, and to complete different modules at a time that suits them.
Individual or combinations of modules will be of interest to exploration and mining geoscientists involved in public reporting of Exploration Results, Mineral Resources and Ore Reserves in compliance with the JORC Code,, end-users of JORC reports, including legal and finance industry professionals and investors, and others involved in JORC report preparation.
Watch your inbox and the AIG web site for details.
AIG is working with leading Australian geological and mining consulting practice, DeRisk Geomining Consultants, to develop an affordable, comprehensive, five module training course for resource and reserves professionals and those who make use of resource and reserve statements.
The course is designed so that all file modules may be completed, or individual models taken to meet specific gaps in personal expertise and professional experience.
The five modules will cover:
Case studies will feature extensively in the presentation of each module.
Development of the course has commenced. The first two modules are being presented in Townsville next week (29 April). The first delivery of the complete course will be in Perth, expected in the third quarter of 2019. This will be followed by regular courses in other locations throughout Australia. Delivery of the course using interactive, real-time, desktop video delivery, providing interaction between the presenter and students during each model is also being planned cater for the needs of students in rural Australia and overseas.
Feedback received from students will be used to continuously improve the quality and relevance of course content.
AIG is one of three parent bodies of the Joint Ore Reserves Committee (JORC).
The course will form a key continued professional development resource, delivered in a flexible manner, consistent with AIG’s not for profit model to ensure it is within reach of all Institute members.
Further details will be published as course development proceeds.
Updated regulations to allow U.S. mining and exploration companies to report mineral resources resources. Competent person requirements also feature in the new rules for the first time.
In October, the U.S. Securities and Exchange Commission (SEC) adopted a final rule that overhauls its existing disclosure requirements for mining company issuers. This represents the first major change since Guide 7 was adopted almost 30 years ago and brings the U.S. into line with countries following CRIRSCO reporting codes. U.S. companies will be required to begin to comply with the new rules in its first fiscal year beginning on or after Jan. 1, 2021.
Under the current SEC reporting rules, mining companies are not permitted to disclose mineral resources. In Canada, Australia, South Africa and other countries, companies have been required to disclose resources where it would be material information for investors.
Dual listed companies will benefit from decreased compliance costs. Previously, companies listed in the U.S.A. and a country following the CRIRSCO convention for mineral resource and ore reserve reporting were compelled to produce different annual reports and other public disclosure documents dealing with resources and reserves for different markets. U.S. exploration companies should find that the new rules assist with raising funds for exploration in the U.S.A. rather than having to resort to listing on overseas markets, including the TSX, TSX.V and ASX.
U.S. companies that are only subject to the SEC rules, may experience increased compliance costs because of the new requirement to disclose mineral resources and have statements of resources and reserves prepared by a qualified person. Canadian companies that are dual-listed in the US and Canada, have been allowed to comply with Canadian rules (NI 43-101) so are unlikely to be affected by the change.
The SEC announcement included some important provisions.
Geothermal energy is specifically excluded from the new rules.
A principles-based definition of materiality, consistent with Securities Act Rule 405 and Exchange Act Rule 12b-2, was adopted by the commission, whereby a matter is material if there is a substantial likelihood that a reasonable investor would attach importance to it in determining whether to buy or sell securities. The commission also proposed that a company should follow an approach requiring aggregation of all mining properties, regardless of size or type of commodity produced, when assessing the materiality of a registrant’s mining operations.
The commission also adopted a definition of mining operations that includes operations on all mining properties that:
The commission also requires that companies materially disclose the basis for setting forward prices for commodities which form an essential component of asset valuation and, therefore, asset materiality. Companies may not exceed the average price for the preceding 24 months. Beyond this, however, qualified persons may use any reasonable and justifiable price, with transparent justification.
The new rules permit a mineral resources to be disclosed inclusive of mineral reserves, as long as mineral resources exclusive of reserves are also stated. This rule is more specific than current requirements of some other reporting codes, including the JORC Code (2012).
Inferred resources are also able to be used in economic analysis, as long as certain conditions are met.
The new rules adhere to the CRIRSCO convention where a public report about a company’s exploration results, mineral resources, and mineral reserves must be based on and fairly reflect information and supporting documentation prepared by a “competent” or “qualified person.” This is the first time that the commission has defined a role for competent persons which may be both individuals, or companies employing individuals responsible for preparing reports.
A “qualified person” is defined as a “mineral industry professional with at least five years of relevant experience in the type of mineralization and type of deposit under consideration and in the specific type of activity that person is undertaking”. Additionally, qualified persons must be “an eligible member or licensee in good standing of a recognised professional organisation at the time the technical report is prepared”. These requirements effectively mirror those of the JORC Code (2012).
The new rules allow multiple qualified persons to prepare a technical report provided the sections of the report for which individuals are responsible are clearly specified, signed dated and consented to by each individual.
Reports must include a consent statement from the qualified person, state whether the qualified person is an employee of the company and, if not an employee, what relationship or interests the qualified person may have in the company.
The rules specifically indemnify the qualified person from findings and conclusions regarding certain aspects of modifying factors discussed in technical reports that the qualified person specifically states were based on information provided by the company – another first and an important legal protection for individuals or groups acting as qualified persons.
A “recognised professional organisation” would have to be either recognised within the mining industry as a reputable professional association, or be a board authorised by U.S. federal, state or foreign statute to regulate professionals in the mining, geoscience, or related field.
Furthermore, the organization must:
The commission has elected, however, to adopt a principles-based approach to professional organisation recognition rather than the approach adopted by existing CRIRSCO codes of publishing a list of Recognised Overseas Professional Organisations (ROPO) updated by organisations responsible for reporting standards in individual countries from time to time. AIG is considered to fully meet the commissions requirements of a recognised professional organisation, supported by it being recognised in all current jurisdictions where CRIRSCO template reporting codes are in use.
AIG welcomes the SEC announcement which brings the U.S.A. closer to countries with effective, transparent and material codes for exploration result, mineral resource and ore reserve reporting that provide informed investors with a basis for sound mineral asset investment decisions. The new rules also provide an opportunity for Australian geoscientists, experienced in the application of the JORC Code and Canada’s National Instrument NI 43-101, to share their knowledge and experience with their U.S. counterparts.
The SEC release announcing the new rules is available here.
The AIG Professionals Subcommittee is a subcommittee of Council comprising:
AIG’s vision statement is “The AIG will strive to be the preeminent Australian professional institute in advocacy for, and public promotion of, all Australian geoscientists”. This is not a static statement. As the practice of geoscience evolves with changes in technology and changes in society’s expectations of professional practice, so must AIG change to preserve its preeminent status.
Benchmarking against the major international geoscience professional institutes shows AIG may be falling behind in its entrance requirements, expectations of Continued Professional Development (CPD) by members and governance.
The Professional Issues Subcommittee was formed at the Face to Face Strategic Planning meeting in June 2016. Its mandate was to create a “Road Map” to improve competency and increase professionalism (and the community perception of professionalism) of AIG members. The Subcommittee’s Charter is summarised in Figure 1.
A PDF copy of Figure 1 (above) is available here.
AIG members will soon receive a link to an on-line survey prepared by the Professional Issues Subcommittee. We are seeking your input as we prepare the Road Map for presentation to the AIG Council. Your responses will assist the subcommittee in its recommendations to Council for AIG to demonstrate best practice.
The survey is seeking your input on the following issues:
The current minimum requirements for AIG Membership are a 3 year bachelor’s degree in the geological sciences and five years relevant professional experience that includes two years in which the applicant has been required to exercise professional judgement and discretion, and is supported by at least two AIG members with personal knowledge of the applicant’s relevant professional experience.
For industry employers, an Honours degree is the desired minimum qualification for graduate employment. This is because, under the modern degree system, most students are not exposed to work requiring problem solving and the exercise of technical and professional judgement until their Honours year. That is, until students complete Honours, they have little to no experience in the acquisition, assessment, compilation and interpretation of data, and little experience in technical writing and professional reporting.
Some institutions require applicants to submit a recent report and undertake a personal interview to demonstrate their functional literacy skills.
In many comparable jurisdictions (Canada, USA, South Africa and Europe) the minimum education requirement for professional institute admission is a 4 year Bachelor’s degree. AIG is currently not, but could potentially be at risk of losing its Recognised Overseas Professional Organisations (ROPO) status which allows our Members to identify as Qualified Persons or Competent Persons in these jurisdictions because of our lesser education requirement.
Should the education requirement be changed to an Honours degree or equivalent and should new applicants be interviewed and be required to submit a recent report (or other example of written, geoscientific work)?
Some professional organisations require applicants to complete a professional Law and Ethics short course, and pass an examination. The short courses are designed to increase knowledge of corporate law, stock exchange rules and other relevant legislation, and teach the obligations and responsibilities that come with adherence to a Code of Ethics. Typically these Law and Ethics short courses involve a seminar followed by an on-line exam.
AIG promotes the benefits of CPD to all members and requires Registered Professional Geoscientists to complete and document a minimum of 50 hours of CPD, on average, annually over a three year period. CPD is not a guarantee of competence. The community at large, however, sees a commitment to CPD as being at the core of an individual being able to describe themselves as a “professional”. Should AIG follow many professional organisations in other disciplines to make undertaking and recording CPD activities a requirement of membership?
Because geoscience is largely unregulated in Australia, essentially anyone can submit a geoscientific report to an employer, client, the public at large, or a government authority. This arguably undermines the practice of professional geoscientists and exposes the public to risks inherent in the misrepresentation and misinterpretation of geoscientific data and observations, not just confined to exploration results and mineral resource reporting. Should Members be encouraged to sign and seal all formal public documents that have been created by them in their professional capacity to employers, clients and the public? Should AIG promote the benefits of only accepting geoscientific reports prepared by members of a professional institute including AIG and AusIMM in Australia, or a Recognised Overseas Professional Organisation?
The JORC Code defines a ‘Competent Person’ as “… a minerals industry professional who is a Member or Fellow of The Australasian Institute of Mining and Metallurgy, or of the Australian Institute of Geoscientists, or of a ‘Recognised Overseas Professional Organisation’ … and … must have a minimum of five years relevant experience in the style of mineralisation or type of deposit under consideration and in the activity which that person is undertaking.” (JORC 2012) The key qualifier in the definition of a Competent Person are the words ‘relevant experience’. What constitutes relevant experience is left to the judgement of the Competent Person (CP) who must be confident of being able to demonstrate competence to a panel of their peers if called on to do so (convened by the AIG or AusIMM Complaints or Ethics and Standards committees)
Several reviews of JORC reports (AIG JORC Representatives, 2015 and Combes, 2016) have identified frequent shortcomings in:
Australia, arguably, benefits from a non-prescriptive standard for exploration results, mineral resource and ore reserve information to securities exchanges. This information, particularly for junior companies, is almost invariably market sensitive, making a high standard of compliance with JORC imperative if JORC is to be preserved, rather than replaced by more prescriptive requirements. There appears to be a compelling argument that our JORC reporting skills need improvement.
Should the definition of a Competent Person under JORC be changed to require Registered Professional Geoscientist (RPGeo) status (and Chartered Professional status for AusIMM members) to implement a requirement for CPD and a higher standard of independent peer review of the CP’s relevant experience? A change for Australian geoscientists would bring them into alignment with Canadian geoscientists who already need to be registered with the relevant provincial registration authority (PGeo). This could be seen to be strengthening the access to reciprocal reporting arrangements to the TSX and TSXV, by far the world’s largest sources of exploration and mining investment capital.
Geosciences are one of only a handful of fields of professional practice in Australia where some form of professional registration is not either mandated by government, or effectively essential due to industry imposed requirements (Waltho 2012).
The Professional Issues Subcommittee is concerned that regulation could be imposed on us, as illustrated by recently proposed Commonwealth legislation for Financial Advisors. The Commonwealth government has released an exposure draft of legislation to raise education, training and ethical standards for Financial Advisers, including a Tertiary degree, an entrance exam, mandatory CPD and an enforceable Code of Ethics for public comment and consultation. Geoscience could be considered to have escaped the attention of government regulators due to the limited exposure of the community to the actions of geoscience professionals. This could, however, change rapidly should there be a scandal relating to the share price of an exploration or mining company that could, for example, have wide reaching consequences for both direct and indirect investors. Many Australian’s superannuation investments have exposure to mining shares.
A number of Australian professional institutes are accredited through the Professional Standards Council (PSC) and regulated through State Professional Practice Acts. Information about this organisation is provided at http://www.psc.gov.au/
This accreditation provides limitations on the liabilities of an organisation and its members, and ensures that organisational self-regulation meets the current Australian standards applicable to other comparable professional organisations (such as Engineers Australia).
Accreditation of AIG by the PSC would require AIG to undertake the following (some of which are already within the scope of current activities):
Additionally there is a cost for PSC membership including a one-time fee of $35,000 and an annual levy equivalent to $50 per AIG member.
Should AIG investigate accreditation and regulation through State Professional Practice Acts?
AIG has experienced steady growth over the past 15 years with fee-paying Members doubling to about 2500. AIG’s management, however, continues to be managed by volunteer members with outsourced administrative (back office) support engaged on a contract basis. The Institute has no paid employees. If the above changes are approved, it is proposed that AIG will need to employ appropriately skilled and experienced staff to manage increased requirements for Membership, raising awareness of AIG’s activities and requirements of membership to universities, employers and regulators that will exceed reasonable expectations of volunteers.
The survey has only 9 questions and should take only about 10 minutes to complete. Please consider your responses – your opinions are important to us.
AIG JORC Representatives (2015) – Strengthening the integrity of Public Reports made under the JORC Code– a confidential green paper prepared for the Australian Institute of Geoscientists
Coombes, J. (2016) Scoping Study Review – Discussion Paper presented to JORC
JORC (2012). The Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves, from http://www.jorc.org/jorc_code.asp
Waltho, A. W. (2012) It’s Time to Think About Professional Registration, from https://www.aig.org.au/its-time-to-think-about-professional-registration/
 To date, professional experience has been assigned greater weighting than education in assessing competence. We cannot, however, rely on the status quo continuing in view of developments overseas.