JORC Table 1 explained: what every ASX drilling announcement must disclose

JORC Table 1 is the checklist of technical disclosures that ASX-listed miners attach to announcements of exploration results, resources and reserves. It tells you how samples were collected and assayed, where every hole is, how intervals were calculated and whether the results are being presented fairly, so it is where you check whether the headline numbers can be trusted.

What the JORC Code is

The JORC Code is the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves, prepared by the Joint Ore Reserves Committee. The 2012 edition is the version incorporated into the ASX Listing Rules (as Appendix 5A), so ASX-listed companies must report exploration results, Mineral Resources and Ore Reserves in accordance with it. A review of the Code has been under way; check the JORC website for the status of any new edition and its effective date.

The Code rests on three principles: transparency (enough information that a reader can understand the report), materiality (all information an investor would reasonably need) and competence (reports based on work by a suitably qualified and experienced Competent Person).

Table 1 is the practical expression of those principles. It lists criteria under five sections, and for each one the company either explains what it did or says why the item is not relevant. It is commonly called the "if not, why not" approach.

The sections of Table 1

A drilling announcement normally includes Sections 1 and 2. Sections are cumulative: a reserve report also covers the earlier sections.

Section 1: sampling techniques and data

This section answers "can we trust the assays?" Key criteria and what to look for:

• Sampling and drilling techniques: diamond core, reverse circulation (RC), aircore or rotary air blast. Diamond core gives the best geological information; RC is cheaper and usually reliable; aircore and RAB are first-pass tools whose results are generally indicative only.
• Drill sample recovery: how much sample came back. Poor recovery, or a relationship between recovery and grade, can bias results.
• Sub-sampling and sample preparation: how the sample was split and crushed, and sample sizes. Relevant in coarse-gold deposits.
• Quality of assay data and laboratory tests: the lab, assay method (fire assay, screen fire, PhotonAssay, four-acid digest for base metals) and quality control: certified standards, blanks and duplicates, and whether they passed.
• Verification of sampling and assaying: independent checks, twinned holes, how data is stored.
• Location of data points: how collars were surveyed and the grid system used.
• Data spacing and distribution: whether spacing is enough to establish continuity, and whether samples were composited.
• Orientation of data in relation to geological structure: whether the holes crossed the mineralisation at a sensible angle. This links directly to true width.
• Sample security, audits and reviews.

Section 2: reporting of exploration results

This section answers "what did they find and is it presented fairly?"

• Mineral tenement and land tenure status: who owns the ground, joint venture interests, native title, any known impediments. Check the company's actual percentage interest.
• Exploration done by other parties: previous explorers' work.
• Geology: deposit type and setting.
• Drill hole information: a table of every material hole with collar easting and northing, collar elevation (RL), dip and azimuth, hole length, down-hole length and depth of each interception. If information is excluded, the company must explain why it is not material.
• Data aggregation methods: weighted averaging, top-cuts, cut-off grade, how short high-grade intervals were combined with lower-grade ones, and any metal equivalent assumptions. See smearing and the nugget effect.
• Relationship between mineralisation widths and intercept lengths: true width estimates, or a statement that only down-hole lengths are reported and true width is not known.
• Diagrams: maps and sections, including a plan view of collar locations, for any significant discovery.
• Balanced reporting: where it is not practicable to report all results, representative reporting of both low and high grades and widths to avoid misleading reporting. See cherry-picking and balanced reporting.
• Other substantive exploration data and further work.

Section 3: Mineral Resources

When a company reports a resource, Section 3 explains the database, the geological interpretation, the estimation method (for example ordinary kriging or inverse distance), the cut-off grade, any top-cuts, bulk density, the basis for classification into Measured, Indicated and Inferred, and why the resource has "reasonable prospects for eventual economic extraction". The resources vs reserves guide explains the categories.

Section 4: Ore Reserves

A reserve is the part of a resource that can be mined economically once modifying factors are applied. Section 4 covers the study the reserve is based on (at least pre-feasibility level), mining method and dilution, metallurgy and recoveries, infrastructure, costs, revenue and price assumptions, environmental and social factors, and the basis for Proved and Probable classification.

The Competent Person statement

Every report of exploration results, resources or reserves must be based on work by a Competent Person: a member of the AusIMM, the AIG or another Recognised Professional Organisation, with at least five years of experience relevant to the style of mineralisation and type of activity. ASX rules require the report to name the Competent Person, state their professional membership and relationship with the company (for example an employee or a consultant, and any shareholding), and confirm they consent to the inclusion of the material in the form and context in which it appears.

A Competent Person who is a full-time employee or significant shareholder is common and allowed. It is simply a fact worth noting alongside everything else.

What ASX Listing Rules chapter 5 adds

Chapter 5 of the ASX Listing Rules sets out additional reporting requirements for mining companies, and ASX Guidance Note 31 explains how ASX applies them. In broad terms:

• Exploration results, resources and reserves must be reported in accordance with the JORC Code.
• For a material mining project, a drilling announcement must include JORC Table 1 (Sections 1 and 2 for exploration results) on an "if not, why not" basis, and the drill-hole information for each hole.
• Reports of Mineral Resources and Ore Reserves must include a summary of material information, with further requirements set out in the rules.
• Competent Person details and consent must be included.

ASX publishes Compliance Updates and FAQs on mining reporting, and has repeatedly highlighted balanced reporting of exploration results, metal equivalents and visual estimates as focus areas. Where it considers an announcement does not comply, ASX can require a correction or retraction and may suspend trading until that happens.

What a complete drilling announcement contains

DrillScore checks announcements against these items and lists missing pieces on the red flags page. A missing item is a disclosure observation, not a finding that results are wrong. You can see every analysed release on the announcements page, and definitions are in the glossary. This guide is general information only.

How to read Table 1 in five minutes

1. Drilling technique: diamond, RC or a first-pass method?
2. Assay method and QA/QC: proper lab assays with standards and blanks?
3. Drill-hole table: are all holes listed, including ones with no result?
4. Aggregation and widths: cut-off, internal dilution, top-cuts and true widths stated?
5. Tenure: does the company own 100%, or a smaller share?

The short version

• The JORC Code 2012 sets the rules; Table 1 is the checklist that shows how results were produced.
• Drilling announcements normally include Section 1 (sampling) and Section 2 (exploration results).
• For material projects, ASX rules require Table 1 and drill-hole details for each hole.
• Check drilling method, assay QA/QC, the hole table, aggregation rules, true width and tenure.
• Every report must name a Competent Person who consents to its form and context.