Open Pit Mine Planning and Design, Two Volume Set & CD-ROM Pack, Third Edition, 3rd Edition

CHAPTER 7

Reporting of mineral resources and ore reserves

7.1 INTRODUCTION

When describing and classifying mineral resources, it is important that the terms being

used are precisely defined and accurately applied. Otherwise, there is the real possibility

that potentially very costly misrepresentations and misunderstandings will arise. When

considering a property for purchase, or lease, or simply considering the purchase of mining

shares, the nature and potential of the assets being represented must be properly and clearly

described. Today, the popular expression for this is ‘transparency’. For the unscrupulous

promoter of mineral properties (or mining shares), the lack of rules, precise definitions and

specified procedures are essential for success. Smoke, mirrors, and sometimes a pinch of salt

are the ‘rules’of the game. Scams involving mineral properties have been around forever and

the stories surrounding them provide interesting table discussions at mining meetings. There

is, however, enough honest risk in mining without the active participation of scoundrels. The

inclusion of this chapter is intended to acquaint the reader with some of the current guidelines

regarding the public reporting of exploration results, mineral resources and ore reserves.

During the period of 1969–1970, Australia was home to a series of stock scams involving

nickel, primarily, but other metals as well (Sykes (1978), Sykes (1988)). In response, the

Australian Mining Industry Council established a committee to examine the issue. The

effort was quickly joined by the Australasian Institute of Mining and Metallurgy (AusIMM)

and in 1971 the Australasian Joint Ore Reserves Committee (JORC) was formed. Between

1972 and 1989, JORC issued a number of reports which made recommendations on public

reporting and ore reserve classification. In 1989 the first version of the JORC Code was

released. Since that time, it has gone through a number of revisions. With the gracious

permission of the AusIMM (2005), the metal/nonmetal related portion of the most recent

document (JORC 2004) has been included as section 7.2 of this chapter.

Over the years, the JORC Code has served as the model for the codes of a number of

countries including those of Canada, the United States, South Africa, the United Kingdom/

Europe, Chile and Peru. The authors have found the Canadian ‘Estimation of Mineral

Resources and Mineral Reserves – Best Practice Guidelines’ to be quite comprehensive and

it is included with the kind permission of the Canadian Institute of Mining, Metallurgy and

Petroleum (CIM, 2004) as section 7.3.

It might be argued that even with a rigorous Code in place abuses will occur. A case in

point is the recent scam/scandal involving the Canadian company Bre-X Minerals Ltd. This

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