In early 2015, India introduced a set of new mining rules, using the terminologies defined in the UNFC 1997 guideline and the CRIRSCO Template. Since then, mapping the Indian Resource Classification system against the CRIRSCO Template has become extremely important to the Indian and foreign investors.
In the recent past, SRK assisted several Indian mining companies and international financial institutions by producing audited mineral resource statements and, where appropriate, reclassifying them from the UNFC 1997 system to the CRIRSCO Template. These experiences led SRK to conclude that, although both codes use similar terminologies, reclassification from the Indian system to the CRIRSCO Template is not straightforward and warrants the diligence and careful professional judgment of Competent Persons.
The Indian system consists of four categories of mineral resources in the increasing order of geological knowledge. These categories are: Reconnaissance (334), Inferred (333), Indicated (332) and Measured (331). Further, reporting of mineral resource estimates are based on a set of prescribed cut-off grades for different commodities, known as the “threshold value”.
In addition, the Indian system recognises the terms “Pre-Feasibility Resources” (221 and 222) and “Feasibility Resources” (211). These are part of either Measured (331) or Indicated (332) categories of resources, as defined in the Indian system; and found to be uneconomic after completing prefeasibility or feasibility studies. SRK does not consider these to be part of the mineral resource, as defined in the CRIRSCO Template.
Since estimates of the Reconnaissance Resources (334) are typically based on regional exploration data, SRK generally considers them to be equivalent to the CRIRSCO definition of Exploration Results. On the other hand, reclassifying the other three categories of mineral resources from the Indian system to the CRIRSCO Template requires thorough assessment on a case-by-case basis. The most critical part in this process is assessing the reasonable prospects for eventual economic extraction of the material, reported as mineral resources according to the Indian system. This process involves professional judgment and application of project-specific techno-economic assumptions. Part of the mineralisation, that meets with the CRIRSCO definition of mineral resources, are classified based on the nature, quality and distribution of the exploration data; and confidence on the estimated results.
Based on practical experience, SRK has developed a rule-of-thumb mapping of the Indian system against the CRIRSCO Template, as outlined below.
