The mandate of the 2005 VALMIN Code to provide ‘(all) reliable, thorough, understandable material information required by investors and their advisers when making investment decisions’ requires that due diligence for tenure be full and thorough. Yet a published due diligence would often appear to be simply a list of tenures allegedly held without any commitment as to the standing of the tenure as safe and secure or otherwise.
The value of due diligence for tenure, as mandated in the 2012 JORC Code and the 2005 VALMIN Code, must focus on compliance rather than simply on ‘vital statistics’. Enforcement in every jurisdiction in Australia focuses on penalties (some more harsh than others) for non-compliance, which, in turn and most importantly, reflects directly on security of tenure. Some 22 Acts (on average) impinge on security of tenure and fundamentally underpin the security of any mineral asset.
This paper will outline regulatory processes to demonstrate how tenure compliance is achieved and argue that the rigorous application of good practices in tenure evaluation will lead to more of this information being made available on a regular basis.
The paper will then focus on further practical examples of tenure compliance failures, the application of these to the requirements of the JORC and VALMIN Codes and due diligence that failed to fulfil the mandate. Examples will be given that alerted other professionals using the JORC Code to complex geological and mining situations of which they were unaware in their valuations.
Finally, the author will make a personal plea for tenure to be considered at the commencement of any reporting process.
Evans-Wheeler, J, 2016. The VALMIN code and tenure compliance – not just a list, in Proceedings Project Evaluation 2016, pp 112–121 (The Australasian Institute of Mining and Metallurgy: Melbourne).