PAN-EUROPEAN RESERVES COMMITTEE (PERC)
MINUTES
TENTH MEETING, Wednesday 28th November 2007, 14.00 - 17.00
Institute of Materials Minerals and Mining, 1 Carlton House Terrace, London SW1Y 5DB
Present
Stephen Henley, Duncan Campbell, Mike Cave, Paul Gribble, Dan Germiquet, Simon Dominy, Niall Weatherstone, Eddie Bailey
Apologies
Ruth Allington, Jay Hambro, Bill Gaskarth, Juan Alvarez, Kerr Anderson, John Clifford, Euan Worthington, Kip Jeffrey, Ross Gordon, Norman West, Richard Chase, John Barry
1. Welcome and introductions
SH welcomed everyone to the meeting and introduced Prof John Monhemius.
2. Prof John Monhemius (JM), chairman of the International Mining and Minerals Association (IMMa) , and of Imperial College briefly described the role and background to the IMMa. The IMMa is the umbrella mining group within IoM3, effectively as the SME is within the AIME. IMMa is the group to which PERC now formally reports within IoM3.
The IMMa was formed by the four minerals divisions of the IoM3 earlier this year. In 2002, when the IMM merged with the Institute of Materials to form the Institute of Materials, Minerals and Mining (IoM3), four minerals divisions were created - Applied Earth Sciences, Mining Technology, Mineral Processing & Extractive Metallurgy and Petroleum & Drilling Engineering. This unfortunate division of the IMM membership led to a loss of identity within the larger organization. In order to counter this identity loss, the minerals divisions have worked together to create IMMa, which will deal with Institute business that is common to the four divisions and which will become their face to the outside world.
With some difficulty the IMMa has built a database of membership from within the four divisions and is hoping to shortly release a newsletter and also to formally launch the Association. JM suggested to the committee that a joint launch of the new PERC Code and the Association would be mutually beneficial and this was agreed. A suggested time for the launch was in the first couple of weeks of April 2008 and the committee are to inform JM at the earliest opportunity if we will be in a position to launch the draft exposure version at this time. In general discussion a one day event was suggested with representation from Europe and the opportunity for the IMM to support the release of the new Code was welcomed.
JM confirmed that PERC was welcome to use the IMMa logo on its documents.
NW suggested that the launch seminar might focus on the link with and importance of the Code to the stock exchange. Whilst accepting that the regulators are devolved from the Code drafting, the Code was local, consistent with international codes and ideally should be acknowledged as the preferred Code and be written into the listing rules. This would offer a protection not available for reporting made in UK/Europe using JORC, SAMREC or similar as Australia or South Africa do not directly regulate in UK/Europe – what recourse has the stock exchange got? Reporting should be done under local conditions, even if the CP concerned is operating via a ROPO. This is becoming more relevant as less main stream mining countries such as the Philippines or Peru publish their CRIRSCO compliant codes. We need to persuade the stock exchange that the Code is country specific the CP need not be, possibly via a “what could go wrong scenario”.
3. Agree the Agenda
The agenda was agreed.
4. Minutes of 2nd October 2007 meeting
The work of the Industrial Minerals sub-committee was acknowledged together with preliminary comments regarding the coal section of the Code. No comments have been received with regard to diamonds.
Linkage with the London regulators and stock exchange was further discussed.
ACTION: DC will draft an introductory letter to UKLA and AIM (and ABI?) outlining the importance of the Code to them (refer to NW’s comments in 2. above and minutes of ninth meeting section 7 a) part iii), how it differs from JORC and similar, and preparing the ground for launch of the PERC Code in the 2nd quarter of 2008 with a one day seminar. Letter to be circulated to the committee for comment and letter to be sent before Christmas. JH to provide contact names and additional appropriate content for the letter.
No reply has been received from Lucy Leroy at AIM with regard to incorporation of PERC comments into the AIM guideline revision.
5. Matters arising
Matters arising from the minutes were discussed as given above.
6. Current Issues
a) CRIRSCO update by Niall Weatherstone from the CRIRSCO meeting of October 10th – 13th
Recent meeting coincided with the CRIRSCO sponsoring group, ICMM, and represented the first formal meeting with all NRO represented. The much broadened CRIRSCO activities were systematically covered in four main areas:
i. Reporting Template
New code development from SAMREC (as yet unpublished), SME (guidelines) and PERC. CRRISCO contemplating whether to follow developments or be proactive. For example, the SME guidelines were published containing many new items without adequate peer review, which is not to be encouraged. (See also section iv.)
ii. UN meeting in Geneva
The mapping of codes from SPE/CRIRSCO/UN systems for the IASB was presented to the UN. The UN is looking for a global minerals/petroleum/governmental/stock exchange report system. CRIRSCO proposed the replacement of words by numbers and the removal of many guidelines and subdivisions. The figure below illustrates the proposed ideas. Axes: F = technical studies; E = economic studies; G = geological studies. 1 = highest confidence.
Achieving change within the UN is difficult. Whilst these proposals were well received by a proportion of the attendees there are obstacles in the form of those countries that have already incorporated UNFC 2004 into their country laws and thus face difficulties in making changes; those who were the architects of UNFC 2004.
iii. Russian and Chinese code mapping to the CRIRSCO Template
Good progress is being made in Russia through the PERC subcommittee and SH. CRIRSCO have responded to SH’s initial report back. CRIRSCO recognises that there is a great need to engage with Russian Regulators to achieve a mutual understanding of the way in which the Russian Federation and ‘Western’ reporting systems work.
ACTION: SH to circulate CRIRSCO response to PERC.
Identification of appropriate responsible groups and individuals makes the situation in China more difficult. There is believed to be a will in China to rewrite and align their systems. Peter Stoker (JORC Chairman) recently visited China in this regard and it is hoped that nominations, responsibility and authorisation from China will result.
iv. Future directions for CRIRSCO
From ii) above, CRIRSCO are concerned that a reactive role is only part of its remit. As an example, there have been various contributions to changes in the definition of Inferred Resources in SAMREC and PERC – what would prompt a change to the Template? In discussion NW explained that national Codes would be followed but in that national codes will never be identical not all elements would automatically be incorporated in the Template. In the event that a national code included new radical elements, these would not be included in the Template until the majority of NROs agreed that such elements were acceptable. In this regard, CRIRSCO should promote and invite comment on these elements such that codes might be augmented by good ideas; by the same token, where ideas were not generally felt to be beneficial, CRIRSCO could communicate this to the NRO concerned. A new Template is not imminent, but material from codes that are being considered includes the best practise guidelines from the CIM and the suggestion of scale (related to confidence) for the different Resource categories from the SME.
Proactively, CRIRSCO has decided to acknowledge the need for a category of material beyond Inferred Resources. In the oil industry, for example, these are Prospective Resources and the UN code has similar categories. CRIRSCO needs an equivalent “discovered but not economic” category. The role for this category is for reporting to governments as opposed to reporting to shareholders and may appear only as guidance rather than being part of the Template. DC suggested that this was already covered by reporting of exploration results/mineralisation potential. NW agreed that target ranges and values were covered by the Codes, but “non resource” material was not; it is recognised that companies have their own systems for resources that they choose not to publish, those resources that are “not quite” economic and so on and it is this area that CRIRSCO wants to address.
CRIRSCO has new accountabilities that result from it’s funding by the ICMM. Additional funding, over and above that provided by ICMM that CRIRSCO might require should be obtained by education and outreach. For example working with the organisers of workshops and conferences to provide for extra days/sessions where the CRIRSCO “product” can be promoted and add value to international reporting. Other ideas are welcomed. Such work demonstrates to the ICMM that they are not CRIRSCO’s sole clients and that CRIRSCO retains independence of action.
ACTION: NW’s CRIRSCO presentation (to AMEC) to go on the PERC website?
b) Reporting Code review and update
Report back from Industrial Minerals Sub Committee
From work conducted by conference call (DG, EB, DC, KJ, RG) and additional correspondence DG presented the recommendations of the sub committee. There was widespread agreement on the work completed.
NW recommended that repetition of definition of industrial minerals, stone and etc be avoided by use of an all encompassing definition at the beginning of the Industrial Minerals section, being clause 44.
The use of “familiar” terms such as quality or chemical analysis rather than grade or assay was seen as appropriate in this section.
For paragraph 47 it was agreed that Reserve be defined as the total material that will be sold (saleable product) as opposed to “as mined”. The saleable product may contain a wide variety of products that do not need to be individually detailed in reporting. Supplementary information is encouraged but not mandatory.
Much discussion ensued with regard to reporting on an “appropriately defined geographical basis”. The basis of this paragraph was to encourage more transparency with regard to reserve reporting avoiding aggregation of geographically disparate reserves. The reporting of very detailed geographic breakdown was seen as undesirable from a commercial point of view but broad areas (e.g, “southern UK”) was agreed on. It was decided that this section should become a guideline that the Competent Person is recommended to act on.
(Steve, do we store the various working copies of the codes on the website? They are the best record of the notes/progress in this regard?).
SH proposed that the column in the working Code spreadsheet to the right of the current comments column (the column in which the industrial minerals proposed Code is located) becomes the draft Code.
ACTION: ALL review all other comments by New Year. Other parts of draft Code will be migrated to this column after this time.
Comments received to date from review of Coal section
Bill Hatton’s comments were reviewed. The general view of the committee was that the SAMREC version of the coal section was too detailed and inappropriate for the PERC Code and there is no will to add additional clauses to the draft Code.
ACTION: PG to contact Bill and Mike Whateley to ask for their thoughts as to why coal is particularly different and merits a separate section in the code when compared to iron ore or similar.
It was felt that the addition of coal related items in Table 1 and more work on synonyms might cover coal within the Code rather than as a separate section.
Progress with PERC ROPO list
No reply has been received from SH’s letter to Graham Woodrow, but this is as anticipated. Informally Graham has agreed to the structure set out in the minutes of the ninth meeting.
ACTION: SH to create initial ROPO list and circulate to committee for comment.
NW proposed that PERC be proactive with regard to the organisations on this list whereby they are contacted annually to ensuring their participation at regular intervals and giving some quality control to the list. Agreed by all.
Other matters arising with regard to the Code review
A sequence of events was put forward leading to the exposure draft of the Code:
Draft letter to UKLA (AIM, ABI) before Christmas describing the importance of PERC to them and to expect a pre-draft version of the Code during January 2008.
SH to circulate the draft code post New Year revision.
Pre-draft version of Code to NOMADS and major UK Consultants for comments by end of January 2008.
c) Election of Chairman for 2008
In general discussion SH confirmed his intention to stand down as chairman following the launch of the exposure draft of the Code. SH would remain on the committee; no nominations were forthcoming from the committee. The importance of the role of the chairman at the release of the draft Code was discussed and a number of names were put forward as possible successors to SH, namely:
Ed Sides
Mike Whateley
Alwyn Annels
Geoff O’Leary
ACTION: PG to discuss this with Mike Whateley.
(Nothing in my notes as to who might contact the other possible successors)
7. Any Other Business
8. Date and Place for next meeting
2pm Thursday 24th January was proposed.