What is new in the JORC Code

1. What is new in the JORC Code? ASX Perth February 2006

2. February 2006 Outline The JORC Code Introduction & Background Changes in 2004 JORC Code Other Codes and International Developments Current Topics of Interest Frequently Asked Questions Discussion.

3. The JORC Code Introduction & Background

4. February 2006 Introduction Model for other national Mineral Resource and Ore Reserves Codes Major strengths Incorporation of the JORC Code into the ASX Listing Rules in 1989 Periodic updating of the Code.

5. February 2006 Where it all started ! �On October 1, 1969, Poseidon directors issued a historic report to the Adelaide Stock Exchange before the start of trading. The statement began: �Further to the report of the recovery of nickel and copper sulphides on September 29, the directors of Poseidon NL announce that the assays received to date of the first completed drill hole PH2 at Windarra, WA, are as follows ����� �Trevor Sykes - The Money Miners.

6. February 2006 The Aftermath �One disturbing feature of the boom-time geological statements is their misleading air of precision. Poseidon�s statement of 3.56 percent nickel looked like a fine calculation to one-hundredth of one percent. In fact, Poseidon had no basis on which to make such a calculation at the time and the actual assay of the core turned out to be substantially lower, although still of ore grade.� Trevor Sykes - The Money Miners.

7. February 2006 Leading to ���. Request from Melbourne Stock Exchange and Federal Government (Rae Commission) to AMIC (Minerals Council of Australia) to develop a code AMIC responded and AusIMM joined promptly ?? JORC Representation from: Australasian Institute of Mining and Metallurgy Minerals Council of Australia Australian Institute of Geoscientists Representation by invitation from: Australian Stock Exchange Securities Institute of Australia Others as deemed appropriate.

8. February 2006 The JORC Code Sets minimum standards for public reporting (in Australia & New Zealand) of Exploration Results, Mineral Resources and Ore Reserves Provides a mandatory system for classification of tonnage/grade estimates according to geological confidence and technical/economic considerations Requires Public Reports to be based on work undertaken by a Competent Person; describes the qualifications and type of experience required to be a Competent Person Provides extensive guidelines on the criteria to be considered when preparing reports on Exploration Results, Mineral Resources and Ore Reserves.

9. February 2006 The JORC Code Does Not �.. Regulate the procedures used by Competent Persons to estimate and classify Mineral Resources and Ore Reserves Regulate companies� internal classification or reporting systems Deal with breaches of the Code by Companies (ASX) Individuals, these are dealt with under code of ethics of AIG and AusIMM or the relevant ROPO.

10. February 2006 Principles of the JORC Code Transparency Clear and unambiguous presentation of information Materiality All the information reasonably required and expected Competence Public reports based on work undertaken by Competent Persons.

11. February 2006 JORC Stakeholders

12. February 2006 Current JORC Members

13. Changes in the 2004 JORC Code

14. February 2006 Recognised Overseas Professional Organisations Naming of Competent Person (transfer from ASX listing rules) Competent Person required for Exploration Results Consolidation of Reporting of Exploration Results (transfer from ASX listing rules) Reporting of Exploration Targets. Changes in 2004 JORC Code

15. February 2006 Changes in 2004 JORC Code Encouragement to quantify risk/uncertainty Revised Diamond Reporting Revised Coal Reporting Introduction of Industrial Mineral Reporting guideline New Appendix 1 � Generic Terms and Equivalents Guideline on level of study expected for Ore Reserves.

16. February 2006 Recognised OverseasProfessional Organisations (ROPOs) 1999 Code was unduly restrictive Competent Persons must belong to AusIMM or AIG ASX list of ROPO�s (currently 21) for overseas Competent Persons Referenced in the 2004 Code.

17. February 2006 Recognised OverseasProfessional Organisations (ROPO�s) Canada Similar system South Africa Currently implementing a ROPO system Similar professional standards to AusIMM and AIG Ability to enforce Rules of Conduct or Codes of Ethics The ROPO convention facilitates international reciprocity of Competent Persons.

18. February 2006 ROPO�s are currently accredited in Europe Canada United States South Africa Detailed list http://www.asx.com.au/professionals/pdf/ropo_letternovember_2005standalone.pdf Current list of ROPO�s

19. February 2006 Reporting of Exploration Results 1999 Code Public Report on �exploration results� did not require the involvement of a Competent Person 2004 Code Requirement to involve a Competent Person for �Exploration Results� introduced This is where it all began!

20. February 2006 Reporting of Exploration Targets 1999 Code No clear distinction between reporting of exploration results and exploration targets 2004 Code Clause 18 clarifies the reporting of �exploration targets� ( separated from the clause on reporting of �Exploration Results�) This approach is designed to facilitate responsible reporting by all explorers.

21. February 2006 Clause 18 - Reporting of Exploration Targets It is common practice for a company to comment on and discuss its exploration in terms of target size and type Should not be misrepresented or misconstrued as an estimate of Mineral Resources or Ore Reserves The terms Resource and Reserve must not be used in this context Any statement referring to potential quantity and grade of the target must be expressed as ranges and must include a detailed explanation of the basis for the statement, and a proximate statement that the potential quantity and grade is conceptual in nature, that there has been insufficient exploration to define a Mineral Resource and that it is uncertain if further exploration will result in the determination of a Mineral Resource.

22. February 2006 Naming of Competent Person 1999 Code The requirement for the Competent Person to be named was not in the Code - ASX listing rules only 2004 Code Transferred to Clause 8 The naming of the Competent Person has been a strong deterrent to public reporting by those who do not qualify as Competent Persons. Changes in 2004 JORC Code

23. February 2006 Resource/Reserve risk and uncertainty Competent Persons are encouraged to quantify risk/uncertainty attaching to resource/reserve estimates (see Guidelines to Clauses 24 & 32 and Table 1) Not a mandatory requirement Reflecting mining project evaluation and increasingly common professional practice. Changes in 2004 JORC Code

24. February 2006 Clause 28 - Level of technical/economic study expected to have been carried out to convert Mineral Resources to Ore Reserves � achievable mine plan Requirements for reporting of Exploration Results transferred from ASX listing rules to Code The diamond and other gemstone reporting requirements consolidated and revised Guidelines for the reporting of Industrial Minerals introduced Modification of the coal clauses and recognition of the new Coal Guidelines. Changes in 2004 JORC Code

25. February 2006 Consolidation of reporting of Exploration Results 1999 Code ASX listing rules included additional requirements for reporting of exploration results 2004 Code Transferred to the Code and removed from the ASX Listing Rules to consolidate the requirements for reporting of Exploration Results. Changes in 2004 JORC Code

26. Other Codes and International Developments

27. February 2006 Other Codes and International Developments Further developments in Resource/Reserve reporting issues underway Driven by international forces, principally overseas regulators Australia has led the international negotiations through Success of the JORC Code Very successful CMMI/CRIRSCO initiative.

28. February 2006 USA SME Reserves Working Group Recommendations Concerning Estimation and Reporting of Mineral Resources and Mineral Reserves Aimed at resolving differences with SEC Chile & Peru New JORC based codes South Africa SAMREC update underway. Other Codes and International Developments

29. February 2006 IASB Extractive Industries Accounting Standard Request to investigate alignment of the mineral and petroleum reporting codes UN-ECE Classification Framework revision recently completed CRIRSCO International reporting template development. Other Codes and International Developments

30. Current Topics of Interest

31. February 2006 Reporting Issues Reporting of Inferred Resources Submissions called from industry Quarter 4 2005 Subcommittee to report end Quarter 1 2006 Lack of (or incorrect) statements regarding the Competent Person Clause 8 is clear on Public Report requirements Use of incorrect terminology Terms such as "Probable Resources", "Geological Resources", "In situ Reserves", "Mining Reserves", �Mining Inventory�, "Possible Reserves" have no meaning under the Code and may not be used in public reports Such terms may be used in internal company reports if the company so wishes, although care should be taken not to create confusion since they are inconsistent with Code terminology.

32. February 2006 Resource and Reserve Categorisation The Code does not allow statements in public reports which provide only total figures for Mineral Resources or Ore Reserves Clause 25 - Mineral Resource estimates must be allocated to the defined categories of Measured, Indicated and Inferred Clause 33 - Ore Reserve estimates must be allocated to the defined categories of Proved and Probable.

33. February 2006 Reporting of Only Contained Metal Clauses 25 and 33 do not allow the reporting of contained metal without also reporting Mineral Resource or Ore Reserve tonnages and grades It is relevant to the potential investor to know whether a quoted quantity of contained metal is the product of a large tonnage of low grade material or of a small tonnage of high grade material Quoting contained metal without also quoting grades can, particularly for Mineral Resources, result in a potential investor inferring a value for the deposit which is totally at variance with its true realisable value.

34. February 2006 Relationship between Mineral Resources and Ore Reserves Clause 34 requires that, where both Mineral Resources and Ore Reserves are reported, it is made clear whether the Mineral Resources are inclusive of, or additional to the Ore Reserves Mineral Resources and Ore Reserves, being "apples" and "pears", should not be added together Large differences between tonnages of Mineral Resources and Ore Reserves may be an indication that not all of the Resources meet the JORC Code requirement of �reasonable prospects for eventual economic extraction�.

35. February 2006 Reference to Assessment Criteria (Table 1) Clause 17 - Report of Exploration Results must include information on sampling of the mineralisation such as drilling/sampling density, drilling/sampling methodology, sample and assay quality, and so on Clauses 26 and 35 - Reports of Mineral Resources and/or Ore Reserves must make mention of any assessment criteria for which inadequate or poor quality data materially affects estimation or classification of the resource or reserve.

36. February 2006 Historical or Overseas Resources These may seem difficult to report in accordance with the JORC Code Continuous disclosure requirements may mean it is desirable to report information which cannot be reported in a timely manner in accordance with the JORC Code, e.g. an acquisition in Kazakhstan, or the acquisition of an older uranium resource. The ASX Companies Update (05-04, 25 March 2004) requires companies to consult the ASX before making any announcement, with the common direction being to Clause 18 It is also possible to apply for a waiver from the Listing Rules to cover specific circumstances, for instance a prospectus.

37. February 2006 ASX Monitoring ASX have increased monitoring of company reports Steps are underway to form a review panel to assist the ASX in this process.

38. Frequently Asked Questions

39. February 2006 Who polices the JORC Code? Companies must comply with ASX listing requirements Competent Persons must conform to their institute Code of Ethics JORC is an advisory body.

40. February 2006 Many examples of reports that appear may not be in accordance with the JORC Code �They should do something� is the cry But who is they and how do we know if they are doing something? The most important they is you. What should you do? Look on the JORC website for advice. But don�t expect someone else to do it for you. It is our industry and we all must ensure the standards are kept high. Who polices the JORC Code?

41. February 2006 What is the expected confidence of Measured, Indicated and Inferred? It is accepted that publicly stated resources and reserves are estimates The JORC Code is not prescriptive. It does not define the methodology to use, nor does it define the required accuracy or precision of estimates The Competent Person has sufficient experience to know what is required, and it is his or her reputation that is on the line Some guidance is provided in the definitions.

42. February 2006 Measured Resource A �Measured Mineral Resource� is that part of a Mineral Resource for which tonnage, densities, shape, physical characteristics, grade and mineral content can be estimated with a high level of confidence. It is based on detailed and reliable exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes. The locations are spaced closely enough to confirm geological and grade continuity.

43. February 2006 Indicated Resource An �Indicated Mineral Resource� is that part of a Mineral Resource for which tonnage, densities, shape, physical characteristics, grade and mineral content can be estimated with a reasonable level of confidence. It is based on exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes. The locations are too widely or inappropriately spaced to confirm geological and/or grade continuity but are spaced closely enough for continuity to be assumed.

44. February 2006 Inferred Resource An �Inferred Mineral Resource� is that part of a Mineral Resource for which tonnage, grade and mineral content can be estimated with a low level of confidence. It is inferred from geological evidence and assumed but not verified geological and/or grade continuity. It is based on information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes which may be limited or of uncertain quality and reliability.

45. February 2006 Proved Reserve A �Proved Ore Reserve� is the economically mineable part of a Measured Mineral Resource. It includes diluting materials and allowances for losses which may occur when the material is mined. Appropriate assessments and studies have been carried out, and include consideration of and modification by realistically assumed mining, metallurgical, economic, marketing, legal, environmental, social and governmental factors. These assessments demonstrate at the time of reporting that extraction could reasonably be justified.

46. February 2006 Probable Reserve A �Probable Ore Reserve� is the economically mineable part of an Indicated, and in some circumstances, a Measured Mineral Resource. It includes diluting materials and allowances for losses which may occur when the material is mined. Appropriate assessments and studies have been carried out, and include consideration of and modification by realistically assumed mining, metallurgical, economic, marketing, legal, environmental, social and governmental factors These assessments demonstrate at the time of reporting that extraction could reasonably be justified.

47. February 2006 Conclusions JORC Code was born following a period of poor industry reporting standards JORC Code continues to be the basis for International Codes Reporting standards need to be maintained and improved Increased monitoring activity is planned.

48. Discussion