When evaluating mining projects, the resource reporting standard used is one of the first things sophisticated investors check. A resource estimate without JORC or NI 43-101 compliance is essentially a geological opinion, not a bankable asset.
JORC (Joint Ore Reserves Committee)
JORC is the Australian reporting standard, mandatory for companies listed on the ASX. Key features:
- Governed by the Australasian Institute of Mining and Metallurgy (AusIMM)
- Resources classified as Inferred, Indicated, or Measured
- Reserves classified as Probable or Proved
- Requires a Competent Person (CP) with relevant experience and professional membership
- The 2012 JORC Code is the current standard
NI 43-101 (National Instrument 43-101)
NI 43-101 is the Canadian standard, mandatory for companies listed on the TSX and TSX-V. Key features:
- Governed by the Canadian Securities Administrators (CSA)
- Uses the same Inferred/Indicated/Measured classification framework
- Requires a Qualified Person (QP) who is a member of a recognized professional body
- Requires a Technical Report filed on SEDAR+
- More prescriptive about disclosure requirements than JORC
How They Impact Valuation
The reporting standard itself does not change the geology. But it dramatically changes investor confidence and, by extension, valuation multiples.
Projects with compliant resources typically trade at:
- 2-5x higher EV/resource ounce multiples than non-compliant projects
- Significantly faster financing timelines (banks and funds require compliant resources)
- Lower cost of capital (risk premium is reduced with third-party verification)
Projects without compliant resources face:
- Limited access to institutional capital
- Higher discount rates in DCF valuations
- Longer due diligence timelines as buyers commission independent reviews
Cross-Recognition
JORC and NI 43-101 are broadly recognized as equivalent standards. A JORC-compliant resource is generally accepted by Canadian exchanges (with some additional disclosure), and vice versa. Other recognized standards include SAMREC (South Africa), SME (USA), and PERC (Europe).
What This Means for Sellers on Mine Market
If you're listing a project for sale, having a compliant resource estimate is the single most impactful thing you can do to maximize value. The cost of commissioning a JORC or NI 43-101 report ($50,000-$200,000 depending on complexity) is almost always recovered many times over in the sale price.
For buyers, always check the compliance status and the date of the estimate. A 2015 JORC resource may need updating to reflect current commodity prices, cost assumptions, and any additional drilling since the report was written.