Jurisdiction - Australia
Reports and Analysis
Australia – ASX Releases Draft Revisions To Listing Rules And Guidance Notes – Changes To Reporting Of Reserves And Resources By Mining And Oil And Gas Companies.

10 November, 2012


Legal News & Analysis – Asia Pacific – Australia – Energy & Project Finance


In brief
  • On 18 September 2012 the ASX released for public comment draft Listing Rules and Guidance Notes for reserves and resources reporting by mining and oil and gas exploration and production entities. The release of the draft rules is the culmination of an extensive process of consultation with industry and investor stakeholders that was commenced by the ASX in October 2011.
  • Interested parties had until 26 October 2012 to make submissions to the ASX in relation to the proposed
The draft Listing Rules and Guidance Notes
Following extensive consultation, which began in October 2011, on
18 September 2012 the ASX released a draft of the revised Listing Rules and Guidance Notes for reporting of reserves and resources by mining and oil and gas exploration and production companies with the stated objective of seeking to improve the standards of public reporting of reserves, resources and exploration information. A copy of the draft can be accessed at www.asxgroup.com.au/media/Reserves_and_Resources_Reporting_Mining_Oil_Gas_Coys.pdf.
ASX invited comments on the draft Listing Rules and Guidance Notes to be submitted by 26 October 2012.
Mining companies
The following new requirements in Chapter 5 of the Listing Rules have been proposed with respect to the reporting of mineral resources and ore reserves by mining companies:
  • Disclosure of exploration results for material projects – reporting in accordance with the listing rule requirements on an “if not, why not” basis. For example, for material drill-holes, the company must include a table setting out specific drill-hole and intercept information or an explanation of why the company has determined that this information is not material to understanding the reported results.
  • Disclosure of estimates of mineral resources and ore reserves for material projects – when reporting on estimates of inferred, indicated or measured mineral resources for the first time, or if material changes are reported, the company must include a summary of all information material to understanding the reported estimates. 
  • Disclosure of historical and foreign estimates of mineralisation for material projects – currently, companies that believe they have an obligation to report historical or foreign estimates of mineralisation that cannot be reported in accordance with the JORC Code are required to apply to the ASX for a waiver of the Listing Rules. To remove the need for such a waiver in certain circumstances, the ASX plans to introduce an exception to the current requirement for companies to report mineral resources and ore reserves in accordance with the JORC Code. However, other supporting information will be required. 
  • Disclosure of production targets – companies reporting on production targets which are not underpinned by an operating mine or ore reserves will be prohibited from disclosing production targets and associated forecast financial information which is based: solely on an exploration target; or solely or partly on historical estimates of mineralisation, or estimates of mineralisation prepared in accordance with a reporting standard in another jurisdiction. This prohibition is being introduced to reduce the level of uncertainty associated with the mineralisation. 
  • Annual mineral resources and ore reserves statement – this statement must be included in a company’s annual report and must include (among other things) the company’s mineral resources and a comparison against previous years, as well as a summary of the governance arrangements put in place with respect to its mineral resources and ore reserves and the estimation process.
Oil & gas companies
With respect to the reporting of petroleum resources by oil and gas companies, the proposed new requirements in the Listing Rules relate to:
  • Reporting in accordance with Petroleum Resources Management System (“SPE-PRMS”) and other general requirements applicable to all public reporting of petroleum resources – the introduction of a general requirement for publicly reported petroleum resources to be classified and reported in accordance with SPEPRMS. Also, some additional general requirements have been introduced aimed at minimising the potential for disclosure to be confusing or misleading for investors.
  • The disclosure of exploration and drilling information – the ASX guidance which currently expects that companies provide structured reporting at regular intervals for each drilling programme is to be removed. As a result, reporting on the progress of a drilling programme will only be required under the Listing Rules when the company expects the information to have a material effect on the price or value of its securities.
  • The disclosure of petroleum reserves, contingent resources and prospective resources for material projects – new guidelines are proposed for companies when reporting on estimates of reserves, contingent resources and prospective resources for the first time, or if material changes are reported. The guidelines include (among other things) a requirement for disclosure of the types of permits or licences held with respect to the reported estimates, an explanation of how estimates were adjusted for risk and the analytical procedures used to prepare the estimates.
  • An annual reserves statement – this statement must be included in a company’s annual report and must include (among other things) the company’s total 1P and 2P reserves (developed/undeveloped, and by product) and a comparison against previous years, as well as a summary of the governance arrangements put in place with respect to its reserves and the estimation process.
  • A qualified petroleum reserves and resources evaluator – the ASX proposes to update the minimum professional qualifications and experience required to be recognised as a qualified petroleum reserves and resources evaluator.
Transitional provisions
The ASX is proposing a 12 month transition period for companies to comply with the new reporting requirements.
In parallel to the ASX’s review, JORC has prepared a revised and updated JORC Code (Australasian Code for Reporting Exploration Results, Mineral Resources and Ore Reserves), which can be accessed at http://www.jorc.org/. This revised code, together with the SPE-PRMS for oil and gas companies, will form the basis on which companies are required to report under the ASX Listing Rules.
JORC is also currently seeking submissions on its proposed revisions to the JORC Code.
Other reforms
During the consultation process the ASX was also asked to consider including obligations for mining and oil & gas companies to disclose payments made by extractive resources companies to host governments (similar to those put in place under the Dodd-Frank Act in the US and recent proposals in Europe). ASX determined that this matter was more appropriately dealt with by the Australian government given the broader public policy issues it raises. The Australian government has not yet made any announcement in relation to this proposal. However, it would seem reasonable to expect that such rules may be introduced in the future.


For further information, please contact:


David McManus, Partner, Ashurst


Peter Atkin, Ashurst

[email protected]


Ashurst Energy & Project Finance Practice Profile in Australia


Homegrown Energy & Project Finance Law Firms in Australia



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