28. ADDITIONAL CONTINUING OBLIGATIONS FOR MINING LISTEES

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1 28. ADDITIONAL CONTINUING OBLIGATIONS FOR MINING LISTEES Chapter 28 sets out the additional disclosure requirements for mining listees. GENERAL RULES FOR DISCLOSURE OF MINING ACTIVITIES REQUIREMENTS FOR ALL DISCLOSURES 28.1 A disclosure by a listee that includes a statement about exploration targets, exploration results, mineral resources, ore reserves or production targets must be prepared in accordance with this Chapter 28, and: if the listee s primary listing is on Sydney Stock Exchange and the listee s mining assets are: not predominantly international, the Reporting Standard; or predominantly international, the Reporting Standard or an equivalent international standard, unless otherwise specified in the Listing Rule Procedures or otherwise directed by Sydney Stock Exchange; or if the listee s secondary listing is on Sydney Stock Exchange, the Reporting Standard or an equivalent international standard, unless otherwise specified in the Listing Rule Procedures or otherwise directed by Sydney Stock Exchange. Note: The Reporting Standard and equivalent international standards relate to the disclosure of exploration targets, exploration results, mineral resources, ore reserves and competent person statements. Rules 28.4 onwards relate to matters not included in the Reporting Standard or the equivalent international standards, including the disclosure of nonequivalent estimates, equivalent international estimates, production targets, forecast financial information, quarterly reporting and the summary of reserves and resources. This Rule is not confined to disclosures solely under this chapter 28, and applies to all disclosures, including security offer documents, information memoranda, bidder s and target s statements, annual reports, financial statements, technical studies, presentations, website content and disclosures under other chapters of the Rules. Rules 28.4 to 28.8 set out the requirements for the disclosure of equivalent international estimates. Rules 28.9 to set out the separate requirements for disclosure of non-equivalent estimates of mineralisation. To ensure consistency of its disclosures, a listee should be mindful of the table format for disclosure of ore reserves and mineral resources set out in Appendix Cross-reference: Rules 28.4, 28.9, 28.14, Appendix 28-1 and Guidance Note Where a disclosure by a listee does not meet a non-mandatory requirement contained in the Reporting Standard, the listee must provide in its disclosure a statement as to how and why its disclosure differs from the non-mandatory requirement contained in the Reporting Standard. Page 154 of 169

2 Note: When a listee is required to comply with the requirements of the Reporting Standard, Rule 28.1 requires listee s to fully comply with all requirements set out in the Reporting Standard. Sydney Stock Exchange also expects listee s to fully comply with all non-mandatory requirements set out in the Reporting Standard (including Table 1 of the JORC Code). In circumstances where a listee departs from a non-mandatory requirement in the Reporting Standard, the listee is required by Rule 28.2 to clearly disclose how and why it does not comply with the non-mandatory requirement A disclosure by a listee that includes a statement about exploration targets, exploration results, mineral resources, ore reserves, production targets or a technical study must not include historical estimates. EQUIVALENT INTERNATIONAL STANDARDS AND EQUIVALENT INTERNATIONAL ESTIMATES 28.4 A listee, when using equivalent international estimates of mineralisation in a technical study, must include all relevant information relating to exploration results, mineral resources or ore reserves that could materially influence the economic value of those exploration results, mineral resources or ore reserves A disclosure by a listee in relation to equivalent international estimates must state the equivalent international standard used by the listee A disclosure by a listee under the SAMREC Code must, until the date prescribed in the Procedures, being a date following the introduction of if not, why not reporting within the SAMREC Code against Table 1 of the SAMREC Code, report against Table 1 of the SAMREC Code on an if not, why not basis. Note: Clause 5 of the Reporting Standard sets out that if not, why not means that each item listed in the relevant section of Table 1 must be discussed and if it is not discussed then the competent person must explain why it has been omitted from the documentation A disclosure by a listee under NI and the CIM Standards must: not include a preliminary economic assessment unless the preliminary economic assessment would be permitted if disclosed under Rules to for production targets, and Rules to for forecast financial information derived from production targets; and where NI requires a report to be lodged with SEDAR (the Canadian System for Electronic Document Analysis and Retrieval ), be disclosed (or also disclosed, in the case of a dual listing on Sydney Stock Exchange) to the Sydney Stock Exchange market in accordance with these Rules If a listee: makes a disclosure under an equivalent international standard then the listee must prominently disclose; a summary of any material differences in the manner in which exploration targets, exploration results, mineral resources and ore reserves are required to be reported Page 155 of 169

3 and disclosed under the Reporting Standard and the equivalent international standard. If the listee considers there are no material differences, the listee must disclose this; and that Australian investors should be aware that there may be risks in relying on disclosures prepared and based on information and supporting documentation prepared by a competent person in accordance with an equivalent international standard including that: (A) (B) these disclosures may not be subject to regulatory oversight in Australia as effective as the regulatory oversight of these disclosures in the competent person s home jurisdiction, or as effective as the regulatory oversight in Australia of disclosures under the Reporting Standard; and noting that a competent person has to be a member of an appropriate professional organisation to qualify as a competent person, any professional organisation referral and disciplinary process sought to be commenced by any stakeholder or complainant in relation to these disclosures based on information and supporting documentation prepared by a competent person, may also not be as effective as if this process were to be commenced in the competent person's home jurisdiction, and that there may be differences in the effectiveness of the referral and disciplinary processes of the various professional organisations of whom competent persons may be members, depending on whether disclosures are made under an equivalent international standard or the Reporting Standard; or changes the basis upon which it makes disclosures from the Reporting Standard or an equivalent international standard (the initial disclosure standard ) to the Reporting Standard or another equivalent international standard (the new disclosure standard ) then the listee must prominently disclose: (iv) a summary of any material differences in the manner in which exploration targets, exploration results, mineral resources and ore reserves are required to be reported and disclosed under the initial disclosure standard and the new disclosure standard. If the listee considers there are no material differences, the listee must disclose this; and if the new disclosure standard is an equivalent international standard, that Australian investors should be aware that there may be risks in relying on disclosures prepared and based on information and supporting documentation prepared by a competent person in accordance with an equivalent international standard including that: (A) these disclosures may not be subject to regulatory oversight in Australia as effective as the regulatory oversight of these disclosures in the competent Page 156 of 169

4 person s home jurisdiction, or as effective as the regulatory oversight in Australia of disclosures under the Reporting Standard; and (B) noting that a competent person has to be a member of an appropriate professional organisation to qualify as a competent person, any professional organisation referral and disciplinary process sought to be commenced by any stakeholder or complainant in relation to these disclosures based on information and supporting documentation prepared by a competent person, may also not be as effective as if this process were to be commenced in the competent person's home jurisdiction, and that there may be differences in the effectiveness of the referral and disciplinary processes of the various professional organisations of whom competent persons may be members, depending on whether disclosures are made under an equivalent international standard or the Reporting Standard. NON-EQUIVALENT ESTIMATES 28.9 Non-equivalent estimates of mineralisation must not be included by a listee in a technical study of the listee s mineral resources and ore reserves holdings Where a listee discloses material non-equivalent estimates of mineralisation the listee does not need to comply with Rule 28.1 provided the listee complies with: Rule 28.11; Rule 28.12; Rule 28.13; and Rule A listee cannot disclose material non-equivalent estimates of mineralisation where the listee is attempting to disclose: preliminary resources where the listee s relevant exploration and evaluation programs are incomplete; ore reserves when the appropriate technical study(s) required by the Reporting Standard to allow the conversion of mineral resources to ore reserves has not yet been completed; non-equivalent estimates of mineralisation for areas adjacent to its mining tenements; or with an intent to avoid the requirements of the Reporting Standard, an equivalent international standard and/or these Rules A listee disclosing material non-equivalent estimates of mineralisation must ensure the disclosure contains the following: Page 157 of 169

5 a prominent, and proximate, statement to the effect that: the estimates are non-equivalent estimates and are not disclosed in accordance with the Reporting Standard or an equivalent international standard; a competent person has not done sufficient work to classify the non-equivalent estimates as mineral resources or ore reserves in accordance with the Reporting Standard or an equivalent international standard; and it is uncertain that following evaluation and/or further exploration work that the nonequivalent estimates will ever be able to be disclosed as mineral resources or ore reserves in accordance with the Reporting Standard or an equivalent international standard; the source(s) and date(s) of the non-equivalent estimates; if the non-equivalent estimates use categories of mineralisation: other than those defined in the Reporting Standard, a statement to that effect and an explanation of the differences; or the same as those defined in the Reporting Standard, a statement to that effect; (e) (f) (g) (h) (j) (k) the relevance of the non-equivalent estimates to the listee; the reliability of the non-equivalent estimates, having regard to the relevant criteria listed in Table 1 of the Reporting Standard; a summary of the evaluation and/or exploration work on which the non-equivalent estimates are based; a summary of the key assumptions, mining and processing parameters and methods used to prepare the non-equivalent estimates; details of any more recent estimates or data relevant to interpreting the non-equivalent estimates, and the source(s) and date(s) of the estimates or data; the evaluation and/or exploration work that needs to be undertaken to verify the non-equivalent estimates as mineral resources or ore reserves in accordance with the Reporting Standard or an equivalent international standard; the proposed timing of the evaluation and/or exploration work disclosed pursuant to Rule 28.12; the proposed source of funding for the evaluation and/or exploration work disclosed pursuant to Rule 28.12; and Page 158 of 169

6 (l) (m) a statement by a named competent person(s) that the information in the disclosure provided pursuant to Rules to is an accurate representation of the available data and studies relating to the non-equivalent estimates. the mineral resources classification and reporting standard used in determining the nonequivalent estimates If a listee has disclosed non-equivalent estimates that complied with Rule 28.12, then any subsequent disclosure in respect of the non-equivalent estimates need not include the information in Rule if the subsequent disclosure: references the earlier disclosure that complied with Rule 28.12; contains a confirmation from the listee that: the information provided in the earlier disclosure that complied with Rule continues to apply; and there is no new material information or data relating to the non-equivalent estimates that impacts on the: (A) (B) the reliability or interpretation of the non-equivalent estimates; or the listee s ability to verify the non-equivalent estimates as mineral resources or ore reserves in accordance with the Reporting Standard or an equivalent international standard; and includes an at least equally prominent, and proximate, statement about the disclosed nonequivalent estimates addressing the matters contained in Rule NON-EQUIVALENT ESTIMATES - SUMMARY OF RESERVES AND RESOURCES If a listee has previously disclosed non-equivalent estimates that complied with Rule which have not subsequently been disclosed as mineral resources or ore reserves in accordance with the Reporting Standard or an equivalent international standard, then: the listee must disclose in its summary of reserves and resources: the steps it has taken in evaluating the previously disclosed non-equivalent estimates; and the status of any further evaluation and/or exploration work required to verify and disclose the non-equivalent estimates as mineral resources or ore reserves in accordance with the Reporting Standard or an equivalent international standard; the status of the proposed source of funding for the evaluation and/or exploration work referred to in Rule 28.14; and Page 159 of 169

7 Cross-reference: Rules 28.12, 28.12(k) and if it has been more than 3 years since the first disclosure of the non-equivalent estimates under Rule and those estimates have not been subsequently verified and disclosed as mineral resources or ore reserves in accordance with the Reporting Standard or an equivalent international standard, then the listee must disclose in its summary of reserves and resources: an explanation of why the non-equivalent estimates have not been verified and disclosed as mineral resources or ore reserves in accordance with the Reporting Standard or an equivalent international standard; and the listee s intention, proposed timetable and proposed source of funding with regard to verifying and disclosing the non-equivalent estimates as mineral resources or ore reserves in accordance with the Reporting Standard or an equivalent international standard. Cross-reference: Appendix PRODUCTION TARGETS A listee must not disclose a production target that is based wholly: on an exploration target; on a combination of inferred mineral resources and an exploration target; or or in part, on non-equivalent estimates. Cross-reference: Rule A production target may be disclosed by a listee in relation to: the listee s mineral resources and ore reserves holdings; or a material mining project of the listee (or two or more mining projects which together are material). Cross-reference: Rules 28.15, and A listee s disclosure pursuant to Rule must include: in relation to the assumptions used to determine the production target: all material economic assumptions employed; or if the mining listee considers the material economic assumptions to be commercially sensitive, a statement to that effect and an explanation of the methodology used to determine the material economic assumptions; and Page 160 of 169

8 all other material assumptions employed. Note: A mining listee that considers that certain information relating to the material economic assumptions is commercially sensitive should refer to Guidance Note 6 and Guidance Note 3. if forecast commodity prices have been used in the determination of the production target, a statement that such forecast commodity pricing was arrived at on reasonable grounds; the proportions of the production target based on: (iv) (v) probable ore reserves and proved ore reserves; indicated mineral resources and measured mineral resources; inferred mineral resources; an exploration target; and equivalent international estimates; a statement that the respective proportions of inferred mineral resources and the exploration target (if applicable) are not the determining factors in the viability of the production target and do not feature as a significant proportion early in the mine plan; Note: Refer to Guidance Note 6. (e) (f) if the production target is in whole or in part based on inferred mineral resources, an at least equally prominent, and proximate, statement to the effect that: The level of geological confidence associated with inferred mineral resources is low. There is no certainty that further evaluation and/exploration work will result in the determination of indicated mineral resources or that the production target itself will be realised. if the production target is wholly based on inferred mineral resources: a statement confirming that the project the subject of the production target is not able to be progressed through to a higher confidence level of mineralisation by conventional exploration alone prior to the disclosure of the production target; an explanation as to why the listee believes it has a reasonable basis for disclosing a production target wholly based on inferred mineral resources, despite the project the subject of the production target not being able to be progressed through to a higher confidence level of mineralisation by conventional exploration alone prior to disclosure of the production target; the level of confidence with which the inferred mineral resources are estimated and the basis for that level of confidence; Page 161 of 169

9 (iv) a technical study of a sufficient level of confidence to support the production target, prepared by, or under the supervision of, a named independent competent person(s); and Note: Refer to Guidance Note 6. (v) an at least equally prominent, and proximate, statement to the effect that: The level of geological confidence associated with inferred mineral resources is low. Though further evaluation work and appropriate studies are required to establish sufficient confidence that the production target will be met, there is no certainty that further evaluation and/exploration work will result in the determination of indicated mineral resources or that the production target itself will be realised. The listee s production target is based on its current expectation of future results or events, and should not be solely relied upon by investors when making investment decisions. Note: Under the Act, a statement about a production target will deemed to be misleading unless the person making the statement has reasonable grounds for making the statement. Sydney Stock Exchange considers that it is only under exceptional circumstances that a listee might form the view that it has reasonable grounds for a production target, (see Rule 28.17(f)), when that production target is wholly based on inferred mineral resources. Refer to Guidance Note 6. (g) if the production target is in part based on an exploration target: a statement of the factors that lead the listee to believe that it has a reasonable basis for disclosing a production target based in part on an exploration target; and an at least equally prominent, and proximate, statement to the effect that: The potential quantity and grade of an exploration target is only conceptual in nature, there has been insufficient exploration to determine a mineral resource and there is no certainty that further exploration work will result in the determination of mineral resources or that the production target itself will be realised If a listee has previously made a disclosure under Rule 28.16, then any subsequent disclosure in relation to a production target need not include the information required to be disclosed by Rule where the subsequent disclosure: references the earlier disclosure that complied with Rule 28.17; contains a statement confirming that all the material assumptions upon which the production target is based in the initial disclosure that complied with Rule continue to apply and have not materially changed; if the production target is wholly based upon inferred mineral resources, includes an at least equally prominent, and proximate, statement about the disclosed production target to the effect of the statement set out in Rule 28.17(f)(v); and Page 162 of 169

10 if the production target is based in part upon an exploration target, includes an at least equally prominent, and proximate, statement about the disclosed production target to the effect of the statement set out in Rule 28.17(g) A disclosure by a listee is not required to comply with Rule where a production target relating to an operating mine(s) is wholly based upon: ore reserves; or a combination of ore reserves and measured mineral resources; a combination of ore reserves; and measured mineral resources; and/or indicated mineral resources, provided that the indicated mineral resources are not the determining factor in project viability. FORECAST FINANCIAL INFORMATION Forecast financial information derived from a production target may be disclosed in relation to either: a listee s mineral resources and ore reserves holdings; or a material mining project of the listee (or two or more mining projects which together are material). Cross-reference: Rules 28.15, 28.17, and A listee s disclosure pursuant to Rule must include: in relation to the assumptions used to determine the forecast financial information: all material economic assumptions employed; or if the mining listee considers the material economic assumptions to be commercially sensitive, a statement to that effect and an explanation of the methodology used to determine the material economic assumptions; and all other material assumptions employed. Note: A mining listee that considers that certain information relating to the material economic assumptions is commercially sensitive should refer to Guidance Note 6 and Guidance Note 3. the production target from which the forecast financial information is derived (including all the information contained in Rule 28.17) If a listee has previously made a disclosure under Rule 28.20, then any subsequent disclosure in relation to forecast financial information derived from a production target, need not include the information in Rule where the subsequent disclosure: Page 163 of 169

11 references the earlier disclosure that complied with Rule 28.21; contains a statement confirming that all the material assumptions upon which the forecast financial information derived from a production target is based in the initial disclosure that complied with Rule continue to apply and have not materially changed; if the production target upon which the forecast financial information is derived is wholly based on inferred mineral resources, includes an at least equally prominent, and proximate, statement about the disclosed forecast financial information to the effect of the statement set out in Rule 28.17(f)(v); and if the production target upon which the forecast financial information is derived is based in part upon an exploration target, includes an at least equally prominent, and proximate, statement about the disclosed forecast financial information to the effect of the statement set out in Rule 28.17(g) A disclosure by a listee is not required to comply with Rules where forecast financial information derived from a production target relating to an operating mine(s) is wholly based upon: ore reserves; or a combination of ore reserves and measured mineral resources; or a combination of ore reserves; and: measured mineral resources; and/or indicated mineral resources, provided that the indicated mineral resources are not the determining factor in project viability. QUARTERLY REPORTS QUARTERLY REPORTS MINING PRODUCTION LISTEES A mining production listee must disclose a report for each quarter of its financial year containing the following information in respect of the mining production listee and all controlled entities (on a consolidated basis): (k) details of the activities relating to mining production and development, or a statement that there have been no activities relating to mining production or development; a summary of: the activities relating to mining exploration, or a statement that there have been no activities relating to mining exploration; any expenditure incurred relating to mining production and development activities; Page 164 of 169

12 any expenditure incurred relating to mining exploration activities; (l) (m) at least once every 12 months, the summary of reserves and resources required by Rule unless it is included in the mining production listee s annual report; and when the previous, and next, disclosure required by Rule was, and is, to be disclosed A mining production listee must disclose the report required by Rule no later than 1 month after the end of the quarter. QUARTERLY REPORTS MINING EXPLORATION LISTEES A mining exploration listee must disclose a report for each quarter of its financial year containing the following information in respect of the mining exploration listee and all controlled entities (on a consolidated basis): details of the activities relating to: mining exploration, or a statement that there have been no activities relating to exploration; and mining production and development, or a statement that there have been no activities relating to mining production or development; a summary of any expenditure incurred relating to: exploration activities; and mining production or development; (e) (f) the mining tenements held at the end of the quarter, their location and the percentage interest held (including the beneficial interests in farm-in or farm-out agreements); and the mining tenements (including beneficial interests in farm-in or farm-out agreements) acquired and disposed of during the quarter, and their location; at least once every 12 months, the summary of reserves and resources required by Rule unless it is included in the mining exploration listee s annual report; and when the previous, and next, disclosure required by Rule 28.26(e) was, and is, to be disclosed A mining exploration listee must disclose the report required by Rule no later than 1 month after the end of the quarter. Page 165 of 169

13 SUMMARY OF RESERVES AND RESOURCES A mining listee must include in its summary of reserves and resources a table as set out in the form of Appendix 28-1 (as of a date no earlier than one month prior to the disclosure of the summary of reserves and resources). Cross-reference: Rules and 28.26(e). MINING TENEMENT JOINT VENTURE DISCLOSURE A listee must not, and must procure that its controlled entities do not, enter a joint venture agreement to investigate or explore a mining tenement, unless the agreement provides that: if the listee requires it, the operator of the joint venture will provide the listee all the information the listee requires to comply with these Rules; and the listee may disclose that information if necessary for the listee to comply with these Rules. Cross-reference: Rule Page 166 of 169