Australia — one of the world’s most important mining nations — is planning to tighten rules that govern how companies announce their exploration results, with a revised code for listed companies including industry leaders BHP Group Ltd. and Rio Tinto Group.
A draft of the new code published on Thursday would impose additional environmental requirements, plus a need for qualified experts to sign off on estimates of minerals and metals to be mined. The tweaked JORC Code — or Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves — will require ministerial approval before coming into force.
“It puts the handbrake on companies making up their own terminology and definitions,” Steve Hunt, JORC committee chair, told Bloomberg. “There’s always a tendency for companies to talk up, as best they can, their investment opportunities. This code provides technical guardrails.”
Australia has a vast mining industry, with players large and small seeking to exploit the nation’s trove of mineral resources including iron ore, gold, and copper, as well materials central to new-energy technology such as lithium. The JORC Code has its roots in the 1970s, when thousands of investors lost billions after a mining company falsified exploration results, then collapsed. It was first published in 1989 and last updated more than a decade ago.
Under the planned changes — which, when adopted, will apply to all locally-listed miners — a company will need to acknowledge publicly any environmental risks to their projects. In addition, a qualified professional, with experience in mining, is required for the technical sign off on a project, and must now display their credentials publicly.
The framework not only sets benchmark standards for Australian-listed miners, but also for companies listed on some overseas exchanges in the region, including the New Zealand Stock Exchange and Papua New Guinea’s Port Moresby Exchange. Further afield, the JORC code is also comparable to Canada’s own version.
“To the extent that any proposals impact on the Listing Rules and our guidance, our main interest will be that the changes continue to encourage strong and consistent disclosure on our market of mining exploration results and estimates of resources and reserves,” a spokesperson for the Australian Securities Exchange told Bloomberg.
No mining entity listed on the exchange will be exempt from the changes, which are expected to take effect next year, according to Hunt. Stakeholders will be consulted over the coming weeks.
(By Paul-Alain Hunt and Georgina McKay)
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