On October 31, 2018, the U.S. Securities and Exchange Commission (SEC) adopted new mining property disclosure requirements. The new rules have significant implications for existing and new listings on U.S. stock exchanges. They aim to modernize the property disclosure requirements for mining registrants and provide investors with comprehensive reporting of mineral properties. The amended rules align more closely with recognized international regulatory standards for Mineral Reserves, Mineral Resources, and Exploration Results, an area in which SRK has extensive knowledge and experience. SRK is well positioned to assist registrants in identifying current gaps and achieve future compliance.

The new rulings require full disclosure of information about company owned mining properties, similar to the Canadian National Instrument (NI) 43-101. They apply to all mining (hard rock and brine) and royalty companies listed on a U.S. exchange. The required disclosure takes the form of asset specific technical report summaries that will be filed on EDGAR. The new rule aims to ensure investors have the knowledge needed to make informed decisions about mining properties. The new rules align with the Committee for Mineral Reserves International Reporting Standards (CRIRSCO). SRK has extensive experience acting in a Qualified Persons (QP) role to report on mineral properties in accordance with CRIRSCO standards.

Key Points
• Timeline: The rules become compulsory for disclosure on January 1, 2021.
• Principles: The rules emphasize “transparency, materiality, and competence”—the three governing principles of the CRIRSCO standards.
• Mining disclosure policy: The provisions in Industry Guide 7 have been replaced with a new subpart of Regulation S-K under the U.S. Securities Act.
• Qualified persons: QPs will be required to report on exploration results, mineral resources, and mineral reserves. QPs must have experience relevant to the type of mineralization and deposit and covering all disciplines, including, metallurgy, tailings, geotechnical engineering, economics, and the environment. QPs are subject to expert liability under Section 11 of the Securities Act based on individual area or discipline expertise.
• Exploration results reporting: Exploration results can now be disclosed if accompanied by specified cautionary statements.
• Mineral resource classification: Mineral resources must be classified as measured, indicated, or inferred.
• Inclusion of inferred resources: Estimates of inferred mineral resources may be included in preliminary economic assessments with appropriate cautionary statements.

Achieving Compliance through Strategic Advisory
Public issuers engaged in mining operations must comply with the new rules for their first fiscal year beginning on, or after, January 1, 2021. Early, voluntary compliance is permitted and encouraged by the SEC. SRK offers technical advice to help mining companies and investors understand the new disclosure requirements and provide management with a strategy for navigating the changes and achieving compliance by 2021.

SRK’s SEC Mining Property Disclosure Resources
• Learn more about SRK's SEC Disclosure Experts
• Watch the SRK and Deloitte Webinar: “Implementing the SEC’s rules modernizing property disclosure requirements for mining companies”
• Presentation Download: “Investment Implications of the SEC’s Rule S-K 1300