On April 9, 2015, the Canadian Securities Administrators (CSA) issued CSA Staff Notice 43‑309 (Review of Website Investor Presentations by Mining Issuers), which summarizes the findings of a review of investor presentations on mining issuers’ websites. Key findings from the review conducted by staff of the British Columbia Securities Commission, the Ontario Securities Commission, and the Autorité des marchés financiers (collectively, the Principal Mining Jurisdiction), include:
- Naming a qualified person (QP), on technical disclosure and position with the Issuer
- Preliminary economic assessments (PEA), use of inferred resources and achievement risk
- Mineral resources and mineral reserves, “resources are not reserves”
- Exploration targets, conceptual only and basis for ranges of concept
- Historic estimates, “not to be relied upon”
The CSA is also concerned with the use of words such as “world class”, “spectacular”, “production ready” and “ore”. Some disclosure, particularly where there is economic analysis, may trigger a technical report filing to support the economic projections.
The Principal Mining Jurisdiction reviewed investor presentations from the websites of 130 mining issuers to determine if they complied with NI 43‑101 (Standards of Disclosure for Mineral Projects), part of NI 51‑102 (Continuous Disclosure Obligations), and other securities legislation. In some instances, their reviews resulted in corrective news releases, technical report filings or refilings.
The CSA was also concerned about reference to quality assurance (QA) and quality control (QC), and naming a laboratory. Other areas of concern were failure to include taxes in economic studies, metal price assumptions, drilling information regarding true widths and higher grade intervals.
In addition, forward looking information often did not provide material factors and assumptions used to develop such information.
Significant non‑compliance areas identified by the CSA included: naming the QP, PEA cautionary language, resources are not reserves, tax implications on economic studies, exploration targets, historical estimates, resources including reserves, data verification, naming the laboratory, QA and QC measures, higher grade intervals in drill intercepts and true width of drill intercepts.
This is the first in-depth review of mining issuers’ websites, but the review process will continue and likely expand to other issuers. It is, therefore, important that all issuers review their disclosure to ensure it complies with not only NI 43‑101, but also the forward looking information under NI 51‑102.