JORC Code Explained: A Complete Guide for Mining Investors

JORC Code Explained: A Complete Guide for Mining Investors

Introduction

The JORC Code is the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. It is a professional code of practice that sets minimum standards for public reporting of exploration results, mineral resources, and ore reserves. The JORC Code is produced by the Australasian Joint Ore Reserves Committee (JORC), which is composed of representatives from the Australian mining and metallurgical institutes, as well as the Australian Securities and Investments Commission (ASIC) and the Australian Stock Exchange (ASX).

History and Purpose

The JORC Code was first published in 1989 and has been updated several times since then, with the most recent version being the 2012 edition. The purpose of the JORC Code is to provide a transparent and consistent framework for the public reporting of exploration results, mineral resources, and ore reserves. This helps to ensure that investors and other stakeholders have access to reliable and accurate information about a company’s mineral assets.

Mineral Resource Categories

The JORC Code defines three categories of Mineral Resources:

• Inferred Mineral Resource: An Inferred Mineral Resource is that part of a Mineral Resource for which quantity and grade (or quality) are estimated on the basis of limited geological evidence and sampling. Geological evidence is sufficient to imply but not verify geological and grade (or quality) continuity. It is based on exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes.
• Indicated Mineral Resource: An Indicated Mineral Resource is that part of a Mineral Resource for which quantity, grade (or quality), densities, shape and physical characteristics are estimated with sufficient confidence to allow the application of Modifying Factors in sufficient detail to support mine planning and evaluation of the economic viability of the deposit. Geological evidence is derived from adequately detailed and reliable exploration, sampling and testing gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes.
• Measured Mineral Resource: A Measured Mineral Resource is that part of a Mineral Resource for which quantity, grade (or quality), densities, shape, and physical characteristics are estimated with confidence sufficient to allow the application of Modifying Factors to support detailed mine planning and final evaluation of the economic viability of the deposit. Geological evidence is derived from detailed and reliable exploration, sampling and testing gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes.

Ore Reserve Categories

The JORC Code defines two categories of Ore Reserves:

• Probable Ore Reserve: A Probable Ore Reserve is the economically mineable part of an Indicated, and in some circumstances, a Measured Mineral Resource. It includes diluting materials and allowances for losses, which may occur when the material is mined. A Probable Ore Reserve has a lower level of confidence than a Proved Ore Reserve but is of sufficient quality to serve as the basis for a decision on the development of the deposit.
• Proved Ore Reserve: A Proved Ore Reserve is the economically mineable part of a Measured Mineral Resource. It includes diluting materials and allowances for losses, which may occur when the material is mined. A Proved Ore Reserve represents the highest confidence category of reserve estimate. The style of mineralisation or other factors could mean that Proved Ore Reserves are not achievable in some deposits.

Competent Person Requirements

The JORC Code requires that all public reports of exploration results, mineral resources, and ore reserves be based on and fairly reflect the information and supporting documentation prepared by a Competent Person. A Competent Person is 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 Professional Organisation (RPO) as included in a list available on the JORC and ASX websites.

Why JORC Matters for Investors

The JORC Code is important for investors because it provides a framework for the transparent and consistent reporting of exploration results, mineral resources, and ore reserves. This helps to ensure that investors have access to reliable and accurate information about a company’s mineral assets, which is essential for making informed investment decisions. The JORC Code also helps to protect investors from misleading or fraudulent claims about a company’s mineral assets.