The meeting will be followed by holiday networking sponsored by the TGDG at Mirto’s Italian restaurant from 5 - 6.30 pm.
A review of NI 43-101 technical reports submitted between June 2011 and June 2012 showed that 40% of the reports reviewed failed to comply with the requirements of the technical report form in a manner likely to have an impact on investors relying on the reports. A further 40% of the reports we reviewed were deficient in complying with form requirements, but in ways less likely to mislead or confuse investors. Only 20% of reports were fully compliant.
The review found the "hot spots" for technical report deficiencies were in providing the assumptions that constrained the mineral resource estimate and in clearly showing that a mineral resource had the "reasonable prospects for economic extraction" required by the CIM mineral resource definitions. Many reports did not provide enough clarity to allow a reader to distinguish historical estimates from current ones, or to understand the context of a historical estimate.
Reports filed on advanced properties (supporting disclosure of economic assessments) commonly showed deficiencies in describing the economic analysis, cost projections, or environmental and social impact. In particular, we noted some reports that neglected tax effects in economic analyses or whose sensitivity analyses considered only favourable developments.
Deficiencies in individual sections of the report often flowed through to the summaries and conclusions. Summaries will often be greatly improved by structuring them to meet the Annual Information Form's requirements for mineral project disclosure (Form 51-102F2, Item 5.4).
A company that pays attention to the common deficiencies, and ensures that each of its material properties has a single, current, complete technical report, will keep mineral disclosure risks to a minimum.
The views expressed in this presentation are those of the authors and should not be taken to represent an official view of the Ontario Securities Commission, the Commission members or staff.
Craig Waldie is a Senior Geologist in the Corporate Finance Branch of the Ontario Securities Commission and is a registered Professional Geoscientist in Ontario. Craig specializes in NI 43-101 compliance reviews of prospectuses, technical reports and other regulatory filings of mining companies, and worked on the recent revisions of NI 43-101. Prior to joining the Commission in 2006, Craig spent over 20 years in the mineral exploration and mining industry and was VP Exploration for several junior mining companies. Craig obtained his MSc from Queen’s University.
James Whyte is a Senior Geologist at the Ontario Securities Commission, and was formerly Senior Staff Writer in the Toronto bureau of The Northern Miner, the weekly newspaper of the North American mining industry. He has experience in mineral exploration, as a staker, geophysical operator, sampler, and geologist, and in environmental and geotechnical consulting for the construction and real-estate business. He was a co-author on four editions of The Northern Miner's book Mining Explained. He is a registered Professional Geologist in Ontario, a geochemist by training and a bushrat by heritage, with a B.Sc. in geology from the University of Toronto and a M.Sc. in geochemistry from Queen’s University.
