There is increasing demand in the mining industry for raising the standard of NI43-101 reporting for mining projects. This is well-illustrated by the article “When is a Mineral Resource not a Resource” by Rod Webster (AMC Consultants), published in the October 2015 issue of CIM Magazine.
Following this, “CIM Definitions, Standards, Best Practices and NI43-101″ by Garth Kirkham (President, Canadian Institute of Mining (CIM) and Chair, CIM Best Practices Committee) was presented as a CIM Management and Economics Society Lecture in November 2015 in Vancouver.
“When is a Mineral Resource a Matchstick” presents letters to the editor of the December 2015 issue of CIM Magazine by Brian Buss (BWB Consulting) and Lindsay Bowker (Bowker Associates) in a similar vein.
The issues with NI43-101 reporting are many and diverse. Some of the more prevalent issues are concerned with unrealistic estimation of resources and reserves from available data, for example:
Other issues are more concerned with unrealistic reporting of economically minable resources and reserves, for example:
There are also issues with feasibility studies based on unrealistic engineering and economics that would result in mines that are likely to become environmental and economic disasters, such as inadequate site characterization, and unrealistic waste management and mine closure plans.
All of the above issues are unnecessary, unproductive and potentially unethical. For those who don’t know better there are online courses available by world class specialists that cover all of the issues raised above, and more.
5 Comments
LAMB
Perhaps it is time to require a “CERTIFICATION” degree in NI 43-101, rather than just accepting the status quo of that person making the assessment & estimate of RESERVES ???
Patric Barry
No, because then the zealots that cry and make these regulations will mandate that all reports be written by such certificated people – if you limit the supply of authors, the price will rise.
During the strong market a QP quoted me $45,000 plus first class travel and costs to write a report – when I inquired as to why the cost was so high he replied “Market Price”. I was offended since the Securities Commission had created this false environment where companies were mandated to pay outrageous fees just to comply with aggressive, and mostly misplaced, regulation.
I support full disclosure, but if the regulations are tightened even more, some zealot (Robert Holland was the one at the BC Securities Commission) can just play you like a yoyo. I’m inclined to blame the Commission staff for creating rules that are too hard to meet, rather than suggesting the authors are performing improperly.
minedoubt
how about we just hang the “qualified person” offenders upside down by their b#lls?? poor quality and erroneous mine valuations (made through either incompetence, negligence or greed) have quickly created and subsequently quickly destroyed billions of dollars worth of value from the industry. This has lead to a mass distrust of the mining industry, also leaving innocent stakeholders (the typical employee and their families) left to deal with the fallout.
Jack de la Vergne
“Let’s put some lipstick on this pig to make it
palatable” is the approach being undertaken by the CIM Best Practices
Committee. There is no cosmetic that will correct the fatal flaw in 43-101.
Mining experts are divided by their disparate disciplines
and have been for many years now. Today no one individual meets the criteria of
expertise necessary to determine the validity of an ore body; there is no
“jack-of-all- trades.” It is absurd to persist in the belief that
such individuals actually exist.
I am hardly the first to recognize this folly. For some time
now most major international mining companies have conducted their feasibility and
due diligence studies in-house with a team that includes separate individuals responsible
and qualified in geology, mining, metallurgy and mineral economics.
As a president of the United States once declared “Whenever a major new set of regulations is
imposed there are individuals who soon learn to game the system.” So it is
with 43-101. The only practical remedy is regular vigilance and due diligence
that proceed to engender amendments to be enacted a soon as first detected.
Michael Alyoshin
IMHO JORC and NI43-101 don’t (and can’t) cure every issue we face during MR&R estimation, but, at least, provide CP/QP/Investor with guidance and structure for how process has to be managed and things to be done. Analyzing JORCs Table 1 and properly done NI43-101 Technical Report immediately helps interested person to understand the project (briefly)- and, very often, highlights its weak points. So, disclosed information usually answers, and, generally, must answer one of the biggest questions- should or shouldn’t I proceed with in-depth Due Diligence.