Question 20 of 23: NI 43-101 Terminology – Ten Short Definitions

Question 5.3: NI 43-101 Terminology – Ten Short Definitions (7 marks)

Question text not reproduced: the examination questions are © Engineers and Geoscientists BC. Open the official past paper (linked at the top of this page) to read the question, then follow the worked solution below.

5.3.1 Mineral inventory. A general, non-defined-term estimate of the total in-situ mineral endowment of a property, including material at all confidence levels and regardless of current economic viability; it is a technical planning figure, not a disclosure category, and must not be presented to investors as if it were a Resource or Reserve.

5.3.2 Data verification. The QP's own independent check of the underlying sample, assay, database and survey data supporting a resource/reserve estimate (site visit, QA/QC review of standards/blanks/duplicates, database audit); it is required specifically because Bre-X-style fraud occurred in the RAW DATA, so verifying the estimate's arithmetic alone is insufficient.

5.3.3 Mineral resource. A concentration of material of intrinsic economic interest, in such form/quantity/grade that there are REASONABLE PROSPECTS for eventual economic extraction, classified as Inferred/Indicated/Measured by increasing geological confidence; it exists independent of current economics, unlike a Reserve.

5.3.4 Ore reserve (Mineral Reserve). The ECONOMICALLY MINEABLE part of a Measured or Indicated Resource, demonstrated by at least a Preliminary Feasibility Study incorporating modifying factors (mining, metallurgical, economic, marketing, legal, environmental, social, governmental); an Inferred Resource can never be classified a Reserve, whatever its apparent economics.

5.3.5 Measured, indicated and inferred. The three Resource confidence categories, driven by data density/quality/spacing: Measured (highest confidence, closely and reliably spaced data, geological/grade continuity confirmed), Indicated (reasonable confidence, wider spacing, continuity assumed with reasonable certainty), Inferred (lowest confidence, sparse/limited data, continuity assumed but not verified).

5.3.6 Qualified Person (“QP”). An individual registered/licensed with a recognized professional association (e.g. EGBC), with relevant experience in the type of mineralization/deposit and activity being reported, who takes personal professional responsibility for the technical disclosure — the central accountability mechanism of the whole 43-101 regime.

5.3.7 Technical report. The detailed, standardized (Form 43-101F1) written disclosure document supporting a material resource/reserve or economic-study announcement, covering property description, geology, exploration/drilling data, QA/QC, estimation methodology, and (where applicable) mining/economic parameters, filed publicly and signed by the QP(s).

5.3.8 SEDAR (now SEDAR+). Canada's mandatory electronic system for filing and publicly retrieving securities disclosure documents, including every 43-101 technical report; its purpose is to make technical disclosure permanently public and auditable, so claims can be checked against the filed record by regulators, analysts and the public at any later date.

5.3.9 Producing issuer. A reporting issuer that derives the majority of its business from mineral production (an operating mine) rather than exploration/development alone; 43-101 applies somewhat different disclosure triggers and technical-report requirements to a producing issuer's ongoing operational disclosures than to an exploration-stage company's.

5.3.10 “Independence.” A specific 43-101 requirement that the QP authoring certain disclosures (notably a first-time resource/reserve estimate or a technical report supporting a significant transaction) have no material financial or employment interest in the issuer or the property beyond normal professional fees, ensuring the technical opinion is not compromised by a stake in the outcome.