Guidance for those preparing and publishing NI 43-101 Technical Reports

The following discussion and guidance focuses on areas to which, in AMC’s experience, regulators pay particular attention when reviewing Technical Reports prepared under NI 43-101. It is not intended as a replacement for guidance contained in NI 43-101 and its companion documents, to which those preparing Technical Reports should always refer (see list at the end of the article).

This article is based on a presentation by Mort Shannon to the annual meeting of the American Exploration and Mining Association in Spokane, Washington, in December 2015. The Item Number, where shown in the following table, refers to Form 43-101F1.

Item No	Issue	Discussion / Guidance	Reference
All	Reporting terminology	Tonnage / grade estimates may only be referred to as “Mineral Resources” or “Mineral Reserves”. Terms such as “geological resources”, “diluted resources”, “mineable resources”, “mineral inventory” “ore reserves”, etc. are not allowed.	NI 43-101 2.2
		Take particular caution with PEAs as these must not contain Mineral Reserves or anything that a reader might construe as a Mineral Reserve.	2.3.1 (a)
		If the report contains a production schedule that includes tonnages and grades, AMC recommended practice is to include a prominent and proximal cautionary note that the scheduled tonnes and grade do not represent an estimate of Mineral Reserves.
All	Cautionary language	The following statement is required when reporting the potential quantity and grade for an exploration target: “The potential quantity and grade is conceptual in nature, there has been insufficient exploration to define a mineral resource” and that “it is uncertain if further exploration will result in the target being delineated as a mineral resource”.	NI 43-101 2.3 (2) (a)

		The following statement is required when reporting the results of a PEA that includes or is based on Inferred Resources: “The preliminary economic assessment is preliminary in nature, it includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty that the preliminary economic assessment will be realized”.	NI 43-101 2.3 (3) (a)

		The following statement is required when reporting historical estimates: “A qualified person has not done sufficient work to classify the historical estimate as current mineral resources or mineral reserves” and “the issuer is not treating the historical estimate as current mineral resources or mineral reserves”.	NI 43-101 2.4 (g)
		The following statement is required when reporting the results of an economic analysis of Mineral Resources: “Mineral resources that are not mineral reserves do not have demonstrated economic viability”.	NI 43-101 3.4 (e)

		The cautionary statements must be included each time the triggering statement is made	43-101 CP
			2.3 (6)
All	Property v Project	Technical Report must cover entire Property, not just a single project on the Property.

		NI 43-101 does not define “Property”, but 43-101CP says: “We consider a property, in the context of the Instrument, to include multiple mineral claims or other documents of title that are contiguous or in such close proximity that any underlying mineral deposits would likely be developed using common infrastructure”.	43-101CP
		If outputs from several mines or projects are likely to be treated through common treatment plant, the mines / projects would be regarded as being part of single Property.	1.1 (6)
All	PEA v PFS v FS	Section 2.3(1)(b) does not allow the inclusion of Inferred Resources in a PFS-level or FS-level economic analysis.	NI 43-101 2.3 (1) (b)
		But Section 2.3(3) does allow the inclusion of Inferred Resources in a PEA.	2.3 (3)
		However, CSA warns that “issuers that blur the boundary between a PEA and a PFS by stating that some or all of the components of the PEA are done at the level of a PFS, run the risk that we may challenge whether the study meets the definition of a PEA”.	CSA Staff Notice 43-307 (16 August 2012)
		CSA is particularly alert to PEAs that appear to be at a PFS (or FS) level, but that give the impression of having been defined as a PEA for the sole purpose of including Inferred Resources.
		If one of the Technical Report recommendations is to go from a PEA straight to an FS, AMC recommends that the reasoning is clearly explained. Otherwise, regulators may interpret it as indicating that the PEA is, in fact, a PFS.
All	Impact of PEA on previous PFS or FS	If the results of a PEA that includes Inferred Resources are disclosed after a PFS or FS that establishes Mineral Reserves have been completed (for example, if the PEA relates to the development of a satellite deposit), The disclosure must include a discussion of the impact of the PEA on the PFS or FS and Mineral Reserves.	NI 43-101 2.3.3 (c)
			43-101CP
			2.3 (4)
3	Reliance on other experts	QPs can only rely on other experts in the areas of:	Guidance to Item 3 in Form 43-101F1

		Legal, political, environmental and tax.
		Diamond / gemstone valuations
		Pricing of commodities for which pricing is not publicly available.

AMC’s principal recommendation:

Read and be familiar with NI 43-101, 43-101CP, Form 43-101F1, CIM Best Practice Guidelines and other guidance published by CIM and regulatory authorities from time to time.