properties.\919\ One of those commenters also suggested allowing
certain information, such as the description of mineral rights and key
permit conditions, to be disclosed in abbreviated form.\920\ That
commenter also supported a version of the summary disclosure of mineral
resources and reserves in tabular form because summary disclosure of
mineral resource and mineral reserves in table form is industry
practice and widely used.\921\ Another commenter recommended merging
the two tables for summary disclosure into one, excluding geographic
disclosure, and eliminating the map requirement for summary
disclosure.\922\
---------------------------------------------------------------------------

    \919\ See letters from Alliance, CBRR, FCX, Midas, and SRK 1.
    \920\ See letter from Midas.
    \921\ See id.
    \922\ See letter from SRK 1.
---------------------------------------------------------------------------

    Many other commenters opposed the proposed summary disclosure
requirements on the grounds that they were overly prescriptive, were
inconsistent with CRIRSCO requirements, and/or would be burdensome in
particular for U.S. registrants that are dual-listed in one of the
CRIRSCO-based jurisdictions.\923\ Commenters that indicated the
proposed tables were too prescriptive stated that their ``one-size-
fits-all'' approach reflected a lack of appreciation for the diversity
of operations within the mining industry and the fact that many of the
details required to be disclosed would not be comparable.\924\ Some
commenters urged the Commission to delete all of the tables and allow
the registrant and its qualified persons to determine the most
appropriate format for presentation of the required disclosure items
(whether in text summaries or in tables designed by the registrant or
its qualified persons).\925\ Another commenter stated that summary
disclosure and accompanying tables should be left to the discretion of
the registrant as long as the disclosure follows an existing global
standard, such as JORC, NI 43-101, or CRIRSCO.\926\ Some commenters
further stated that the Commission should limit the tables to a list of
material properties and statements of mineral resources and mineral
reserves.\927\
---------------------------------------------------------------------------

    \923\ See letters from AIPG, Amec, BHP, Chamber, CIM, Cleary &
Gottlieb, Cloud Peak, Coeur, Eggleston, Graves, Newmont, NMA 1,
NSSGA, Royal Gold, SAMCODES 1, SME 1, Vale, and Willis.
    \924\ See letters from AIPG, Chamber, Cleary & Gottlieb, NMA 1,
NSSGA, SAMCODES 1, and SME 1.
    \925\ See letters from AIPG, Graves, NMA 1, SME 1, and Vale.
Similarly, most commenters that responded to our request for comment
opposed requiring the summary disclosure to be formatted in XBRL on
the grounds that the data required to be disclosed in those tables
was largely specific to each registrant and would not benefit from
presentation in a structured format. See letters from AIPG,
Alliance, Amec, AngloGold, CBRR, Chamber, Eggleston, MMSA, Rio
Tinto, and SME 1.
    \926\ See letter from Cloud Peak.
    \927\ See, e.g., letters from Coeur, SME 1, and Willis.
---------------------------------------------------------------------------

    One commenter indicated that disclosure of information on the top
20 properties, by asset value, would not be useful for investors.\928\
That commenter stated that a technical report summary would provide
more meaningful information in a context that would allow an investor
to understand better the value of a project.
---------------------------------------------------------------------------

    \928\ See letter from Amec.
---------------------------------------------------------------------------

    Another commenter opposed the proposed summary disclosure
requirement because it ``all but eliminates'' the discretion of the
registrant and qualified person to determine the most suitable
presentation of material information relating to each property. That
commenter noted that other alternative bases for grouping operations
other than by asset value, such as geographic region, commodity or
reporting segment, may be more informative for investors.\929\ Other
commenters stated that the disclosure required regarding the top 20
properties by asset value was too complex to be put in a table.\930\
---------------------------------------------------------------------------

    \929\ See letter from Cleary & Gottlieb.
    \930\ See letters from AIPG, FCX, Newmont, and SME 1.
---------------------------------------------------------------------------

    Several commenters opposed the proposed tabular presentation of
summary disclosure of mineral resources and reserves because they
believed it conflicted with CRIRSCO requirements that resources and
reserves should not be reported in the same table, and inferred
resources should not be presented alongside indicated and measured
resources, in order to avoid misleading investors that resource
estimates are as economically feasible as reserve estimates.\931\ Some
of the commenters, however, maintained that mineral resources should
include reserves, as permitted under the CRIRSCO-based codes.\932\
---------------------------------------------------------------------------

    \931\ See letters from AIPG, BHP, CIM, Cleary & Gottlieb, SME 1,
and Vale.
    \932\ See, e.g., letters from BHP 1 and SAMCODES 1.
---------------------------------------------------------------------------

    Many commenters opposed the proposed instruction requiring the
mineral resource and reserve estimates in proposed Table 3 to be in
terms of saleable product.\933\ Most of those commenters maintained
that it is customary under the CRIRSCO-based

codes to disclose mineral resources on an in situ basis and that the
proposed instruction would effectively define a mineral resource as a
mineral reserve.\934\ Commenters further recommended requiring the
disclosure of reserves on either a run of mine or plant/mill feed basis
\935\ (for metals and some coal and industrial mines) \936\ or in terms
of saleable product (if customary for some coal and industrial mines)
and not on an in situ basis.\937\
---------------------------------------------------------------------------

    \933\ See letters from Amec, AngloGold, BHP, CIM, Eggleston,
FCX, Newmont, Rio Tinto, SAMCODES 1, SME 1, and Vale.
    \934\ See letters from BHP, CIM, Eggleston, Newmont, Rio Tinto,
and SME 1.
    \935\ ``Run of mine'' ore refers to ore in its unprocessed form
(i.e., in the form mined), while plant/mill feed refers to the
material that is fed to a processing plant. Both terms are used in
the mining industry, in this context, to refer to material that is
affected by mining dilution and losses but is yet to be processed.
    \936\ See letters from AngloGold, CIM, Golder, Newmont, SME 1,
and Vale. See also letter from FCX (mineral reserves should either
be disclosed as ``run-of-mine (plant/mill feed) ore tons, contained
product before plant recovery and saleable product after plant
recovery'').
    \937\ See letters from CRIRSCO, Golder, Rio Tinto, SME 1, and
Vale.
---------------------------------------------------------------------------

    One commenter stated that, due to the nature of the aggregates
industry, where products are relatively low-priced, mines are shallow,
the costs of developing an aggregates quarry or underground mine are
far less, and the risks are low compared to other types of mines, many
of the proposed tabular disclosure items about reserves, resources and
related data points appeared to be either immaterial to investors or to
consist of proprietary information the disclosure of which would harm
an aggregates company's competitive position.\938\
---------------------------------------------------------------------------

    \938\ See letter from NSSGA.
---------------------------------------------------------------------------

iii. Final Rules
    With some modification, we are adopting the proposed requirement
that registrants with material mining operations, which own or
otherwise have economic interests in two or more mining properties,
provide summary disclosure of their mining operations.\939\ Many
commenters agreed with our proposal to require summary disclosure even
if they disagreed with one or more of the specific disclosure
items.\940\ We continue to believe that, for registrants with material
mining operations, requiring an overview of their mining operations,
regardless of whether they have material individual properties, will be
useful to investors and help foster more efficient and effective
disclosure.
---------------------------------------------------------------------------

    \939\ 17 CFR 229.1303(a)(1) [Item 1303(a)(1) of Regulation S-K].
The registrant must provide the summary disclosure for all
properties that the registrant owns or in which it has, or it is
probable that it will have, a direct or indirect economic interest.
It also must provide summary disclosure for properties that it
operates, or it is probable that it will operate, under a lease or
other legal agreement that grants the registrant ownership or
similar rights that authorize it, as principal, to sell or otherwise
dispose of the mineral. Further, a registrant must provide summary
disclosure for properties for which it has, or it is probable that
it will have, an associated royalty or similar right, unless the
registrant lacks access to the information about the underlying
properties, as specified in Item 1303(b) of Regulation S-K, and the
registrant meets the conditions for omitting the summary disclosure
pursuant to Item 1303(a)(3) of Regulation S-K. See supra Section
II.B.4.
    \940\ See, e.g., letters from AngloGold, CBRR, Columbia, Davis
Polk, Midas, Rio Tinto and SRK 1.
---------------------------------------------------------------------------

    We recognize that many commenters opposed our proposal to require a
presentation of summary disclosure, in tabular form, of certain
specified information about the 20 properties with the largest asset
values because they believed it to be overly prescriptive, inconsistent
with CRIRSCO requirements, or burdensome in particular for U.S.
registrants that are dual-listed in one of the CRIRSCO-based
jurisdictions.\941\ To reduce the prescriptive nature of the summary
disclosure requirement, consistent with commenters' suggestions, the
final rules will permit a registrant to present an overview of its
mining properties and operations in either narrative or tabular
format.\942\
---------------------------------------------------------------------------

    \941\ See supra note 923 and accompanying text.
    \942\ See 17 CFR 229.1303(b)(2).
---------------------------------------------------------------------------

    In addition, in a change from the proposed rules, which required
the disclosure of the total production from each of the registrant's
top 20 properties by asset value for the three most recently completed
fiscal years, the final rules require that the overview must include
annual production on an aggregated basis \943\ for the registrant's
mining properties during each of the three most recently completed
fiscal years.\944\ Moreover, rather than require the disclosure of
other specified information for each of a registrant's top 20
properties by asset value, the final rules provide that the overview
should include the following information for the registrant's mining
properties considered in the aggregate, and only as relevant:
---------------------------------------------------------------------------

    \943\ In a change from the proposed rules, the final rules
eliminate the proposed instruction that would permit a registrant
with interrelated mining operations to treat those operations as one
mining property for the purpose of providing summary disclosure.
Since we are no longer requiring the disclosure of specified
information for each of a registrant's top 20 properties, and are
only requiring such disclosure in the aggregate, we no longer
believe that instruction to be necessary.
    \944\ 17 CFR 229.1303(b)(2)(i) [Item 1303(b)(2)(i) of Regulation
S-K].

     The location of the properties; \945\
---------------------------------------------------------------------------

    \945\ As proposed, the summary disclosure must include a map or
maps showing the locations of all mining properties. See Item
1303(b)(1) of Regulation S-K [17 CFR 229.1303(b)(1)]. We continue to
believe the map requirement is an effective means of providing
investors with a point of reference to assess the geographic and
socio-political risks associated with the registrant's mining
operations. Item 102 requires registrants to provide ``appropriate
maps'' disclosing ``the location'' of significant properties, but
does not address whether or when registrants with multiple
properties, none of which are material, should provide a map (or
maps) showing the location of all its mining properties. We believe
that the adopted map requirement, which is consistent with current
practices, will help ensure that investors are provided with
beneficial information without significantly impacting current
disclosure practices.
---------------------------------------------------------------------------

     The type and amount of ownership interests;
     The identity of the operator or operators;
     Titles, mineral rights, leases or options and acreage
involved;
     The stages of the properties (exploration, development,
or production);
     Key permit conditions;
     Mine types and mineralization styles; and
     Processing plants and other available facilities.\946\
---------------------------------------------------------------------------

    \946\ 17 CFR 229.1303(b)(2)(ii) [Item 1303(b)(2)(ii) of
Regulation S-K].

    The final rules also include a provision explaining that, when
presenting the overview, the registrant should include the amount and
type of disclosure concerning its mining properties that is material to
an investor's understanding of the registrant's properties and mining
operations in the aggregate.\947\ The provision further states that
this disclosure will depend upon a registrant's specific facts and
circumstances and may vary from registrant to registrant. Finally, this
provision asks registrants to refer to, rather than duplicate, any
disclosure concerning individually material properties provided in
response to the individual disclosure requirements,\948\ discussed
below.\949\
---------------------------------------------------------------------------

    \947\ 17 CFR 229.1303(b)(2)(iii) [Item 1303(b)(2)(iii) of
Regulation S-K].
    \948\ See id.
    \949\ See infra Section II.G.2.
---------------------------------------------------------------------------

    We believe this more principles-based approach to eliciting summary
disclosure on a registrant's mining operations addresses commenters'
concerns while still providing a meaningful overview of registrants'
mining operations, particularly for those registrants with no or only a
few individually material properties. As previously explained, Guide 7
currently calls for the disclosure of all of the above listed items of
information.\950\ We note, for instance, that most registrants engaged
in industrial minerals and aggregates mining have no or only a few
individually material properties and currently provide disclosure
similar to

summary disclosure called for by Guide 7.
---------------------------------------------------------------------------

    \950\ See Proposing Release, supra note 5, Section II.G.1.
---------------------------------------------------------------------------

    This more principles-based approach is also intended to address the
concern of some commenters that the proposed rules established a ``one
size fits all'' approach that did not account for the diversity of
operations within the mining industry.\951\ By requiring a registrant
to provide an overview of its mining operations that includes the
suggested items of information, as relevant, tailored to its particular
facts and circumstances,\952\ and presented in a manner of the
registrant's choosing, we believe the final rules will elicit material
information for investors without unduly burdening the registrant.
---------------------------------------------------------------------------

    \951\ See, e.g., letter from NMA 2.
    \952\ Another provision states that, as proposed, a registrant
with a royalty or similar economic interest should provide only the
portion of the production that led to royalty or other incomes for
each of the three most recently completed fiscal years. See Item
1303(b)(2)(iv) of Regulation S-K. We continue to believe that
registrants with a royalty or similar economic interest in mining
properties, if they have access to such information, should only
report the portion of production leading to their incomes to reduce
the risk of confusing investors.
---------------------------------------------------------------------------

    As proposed, the final rules require a registrant to provide a
summary of its mineral resources and mineral reserves at the end of its
most recently completed fiscal year, by commodity and geographic
area,\953\ and for each property containing 10 percent or more of the
registrant's mineral reserves or 10 percent or more of the registrant's
combined measured and indicated mineral resources. The registrant will
be required to provide this summary, including the amount and grade or
quality, for each class of mineral reserves (probable and proven) and
resources (inferred, indicated, and measured), together with total
mineral reserves and total measured and indicated mineral
resources.\954\
---------------------------------------------------------------------------

    \953\ Similar to a proposed instruction, the final rules define
``by geographic area'' to mean by individual country, regions of a
country, state, groups of states, mining district, or other
political units, to the extent material to and necessary for an
investor's understanding of a registrant's mining operations. See 17
CFR 229.1303(b)(3)(i) [Item 1303(b)(3)(i) of Regulation S-K]. We
continue to believe this breakdown is necessary for investors to
understand the source and associated socio-political risks of the
registrant's mineral reserves and resources.
    \954\ See 17 CFR 229.1303(b)(3). As previously discussed, all
mineral reserves and resources reported in the summary disclosure
must be based on, and accurately reflect, information and supporting
documentation prepared by a qualified person. See Item 1302(a) of
Regulation S-K; see also Section II.C.1. for a discussion of the
final rules' stipulations on the responsibilities of the qualified
person and the registrant.
---------------------------------------------------------------------------

    We continue to believe that the summary disclosure of mineral
resources and reserves is necessary to understand a registrant's
material mining operations at fiscal year's end. For example, an
understanding of the registrant's total mineral resources and reserves
and where those mineral resources and reserves are located can enable
investors to understand and evaluate the registrant's projected future
earnings from its mining operations and its ability to replenish
depleting mineral reserves, a well-established measure of financial
performance in mining.\955\ The breakdown of the mineral resources and
reserves by category and source (geographic area and property) also
will provide investors with a measure of the associated risk.
---------------------------------------------------------------------------

    \955\ See, e.g., R. L. Robinson and B. W. Mackenzie, Economic
Comparison of Mineral Exploration and Acquisition Strategies to
Obtain Ore Reserves 281-282 (1987). (``Mining company objectives are
. . . profit, growth, and survival . . . To survive, the company
must successfully invest . . . in replacing the depleted ore
reserves. An underlying thread among the profit, growth, and
survival objectives is ore reserve replacement and growth''). See
also H. R. Bullis, Gold Deposits, Exploration Realities, and the
Unsustainability of Very Large Gold Producers 313-320 (2003).
---------------------------------------------------------------------------

    Contrary to the concerns of some commenters,\956\ the final rules'
requirement that a registrant provide a summary of its mineral
resources and reserves does not impose an affirmative obligation to
estimate mineral resources and reserves, as defined in these rules, on
a mining property where the registrant has not estimated mineral
resources and reserves. Registrants will have an obligation to disclose
mineral resources and reserves in their summary disclosure only to the
extent that they have already engaged a qualified person or persons to
estimate such mineral resources and reserves.
---------------------------------------------------------------------------

    \956\ See, e.g., letter from NSSGA.
---------------------------------------------------------------------------

    In order to standardize the disclosure, facilitate a registrant's
compliance with the disclosure requirements, and enhance investor
understanding of this information, similar to our proposal, the final
rules require that a registrant provide the summary of all mineral
resources and reserves at the end of the most recently completed fiscal
year in tabular format. However, we agree with those commenters that
maintained that we should separate disclosure of mineral resources and
reserves in order to reduce the potential for investor confusion.\957\
Accordingly, the final rules require registrants to use separate tables
when reporting mineral resources and reserves, as required by Item
1303(b)(3) of Regulation S-K. The disclosure should follow the format
of the tables designated as Tables 1 and 2 to paragraph (b) of Item
1303.
---------------------------------------------------------------------------

    \957\ See supra note 931 and accompanying text.
---------------------------------------------------------------------------

    Similar to a proposed instruction, we are adopting a provision
requiring mineral resources, reported in the summary disclosure
provided in Table 1 to paragraph (b) of Item 1303, to be exclusive of
mineral reserves.\958\ We continue to believe that requiring the
disclosure of mineral resources exclusive of reserves in the main
disclosure document (as opposed to such disclosure in the technical
report summary, which is attached as an exhibit to the Commission
filing) will reduce the risk of investor confusion. In contrast, we
believe that, because the technical report summary is more likely to be
read by analysts or investors possessing a more sophisticated
understanding of the mining industry and its current practices than the
average retail investor, permitting mineral resources to include
mineral reserves when disclosed in the technical report summary is less
likely to cause confusion.\959\
---------------------------------------------------------------------------

    \958\ 17 CFR 229.1303(b)(3)(ii) [Item 1303(b)(3)(ii) of
Regulation S-K].
    \959\ See infra Section II.G.3. for a discussion of the adopted
provision that permits a qualified person to disclose resources
inclusive of reserves in the technical report summary as long as he
or she also discloses resources as excluding reserves.
---------------------------------------------------------------------------

    Similar to another proposed instruction, we are adopting a
provision requiring that all disclosure of mineral resources and
reserves be only for the portion of the resources or reserves
attributable to the registrant's interest in the property.\960\
Commenters did not oppose this proposed instruction.\961\ For the
reasons stated in the Proposing Release, we continue to believe that
this provision is reasonable and would help reduce investor
confusion.\962\
---------------------------------------------------------------------------

    \960\ 17 CFR 229.1303(b)(3)(iii) [Item 1303(b)(3)(iii) of
Regulation S-K].
    \961\ Only one commenter addressed this proposed instruction.
That commenter stated that, although it believed the decision to
report mineral resources or mineral reserves on a 100% or other
ownership basis should be at the discretion of the registrant, it
considered ``that the information on the registrant's interest in
the property is important information and should be included with
the reporting of Mineral Resource and Mineral Reserve estimates.''
Letter from Amec.
    \962\ See Proposing Release, supra note 5, at Section II.G.1.
---------------------------------------------------------------------------

    As previously discussed, we are revising our approach to what is
permitted regarding selecting an appropriate price to determine
``prospects of economic extraction'' for mineral resources and
``economic viability'' for mineral reserves.\963\ Consequently, the
final rules provide that each mineral resource and reserve estimate
must be based on a reasonable and justifiable price, selected by a
qualified person, which provides a

reasonable basis for establishing the prospects of economic extraction
for mineral resources, and is the basis for determining the economic
viability of the deposit for mineral reserves.\964\ We believe this
approach will further align the Commission's rules with the CRIRSCO
requirements and help limit the compliance burden on registrants.
---------------------------------------------------------------------------

    \963\ See supra Sections II.E.4., II.F.2.
    \964\ 17 CFR 229.1303(b)(3)(iv) [Item 1303(b)(3)(iv) of
Regulation S-K].
---------------------------------------------------------------------------

    Many commenters stated that requiring registrants to disclose
mineral resources and reserves at a specific point of reference (in
this case, as saleable product) is counter to the CRIRSCO-based codes
and current industry practice, which permit the estimation of resources
and reserves at a disclosed single point of reference selected by the
qualified person.\965\ To help limit the compliance burden for
registrants, especially those that are cross-listed in CRIRSCO-based
jurisdictions, the final rules will permit a registrant and its
qualified person(s) to disclose mineral resources and reserves at any
point of reference as long as they disclose the selected point of
reference. For summary disclosure, the final rules require that each
mineral resource and reserve estimate in Tables 1 and 2 to paragraph
(b) of Item 1303 be based on a specific point of reference selected by
a qualified person. The registrant also must disclose the selected
point of reference for each of these Tables 1 and 2.\966\
---------------------------------------------------------------------------

    \965\ See supra note 933 and accompanying text.
    \966\ 17 CFR 229.1303(b)(3)(v) [Item 1303(b)(3)(v) of Regulation
S-K].
---------------------------------------------------------------------------

    Another provision stipulates, as proposed, that the registrant may
modify the tabular formats in Tables 1 and 2 to paragraph (b) of Item
1303 for ease of presentation or to add information.\967\ While we
continue to believe that the tabular presentation of summary resources
and reserves disclosure will standardize the disclosure and make it
easier for investors to understand and assess investments in
registrants engaged in material mining operations, we emphasize that
the tables can be modified to fit a registrant's particular situation.
Contrary to the views of several commenters,\968\ like the proposed
rules, the final rules expressly provide, in recognition of the
diversity in the mining sector, that registrants can modify the tables
to fit their own particular facts and circumstances.
---------------------------------------------------------------------------

    \967\ 17 CFR 229.1303(b)(3)(vi) [Item 1303(b)(3)(vi) of
Regulation S-K]. However, a registrant may not modify the tabular
format to remove any of the required disclosure from the tables.
    \968\ See letters from AIPG, Chamber, Cleary & Gottlieb, NMA,
NSSGA, SAMCODES 1, and SME 1.
---------------------------------------------------------------------------

    A final provision states that all material assumptions and
information pertaining to the summary disclosure of a registrant's
mineral resources and mineral reserves required by this section,
including material assumptions related to price estimates, must be
current as of the end of the registrant's most recently completed
fiscal year.\969\ We believe this provision is a useful reminder that,
although the qualified person is responsible for determining the
mineral resource or reserve estimates included in the summary
disclosure, the registrant bears the ultimate responsibility for
ensuring that those estimates, and the material assumptions underlying
them, remain current as of the date for which the mineral resource or
reserve estimates have been disclosed.
---------------------------------------------------------------------------

    \969\ 17 CFR 229.1303(b)(3)(vii) [Item 1303(b)(3)(vii) of
Regulation S-K].
---------------------------------------------------------------------------

2. Requirements for Individual Property Disclosure
i. Rule Proposal
    We proposed that a registrant with material mining operations
provide, in addition to summary disclosure, more detailed information
for each of its individual properties that is material to its business
or financial condition.\970\ We made this proposal because of our
belief that summary property disclosure alone would not provide all
relevant information about the properties and assets that generate a
mining registrant's revenues. We therefore proposed that, for each
material individual property, a registrant would have to provide a
brief description of the property, including:
---------------------------------------------------------------------------

    \970\ See Proposing Release, supra note 5, at Section II.G.2.

     The property's location, accurate to within one mile,
using an easily recognizable coordinate system (e.g., latitude and
longitude), including appropriate maps, with proper engineering
detail (such as scale, orientation, and titles), which must be
legible on the page when printed;
     Existing infrastructure, including roads, railroads,
airports, towns, ports, sources of water, electricity, and
personnel; and
     A brief description, including the name or number and
size (acreage), of the titles, claims, concessions, mineral rights,
leases or options under which the registrant and its subsidiaries
have or will have the right to hold or operate the property, and how
such rights are obtained at this location, indicating any conditions
that the registrant must meet in order to obtain or retain the
property. If held by leases or options or if the mineral rights
otherwise have termination provisions, the registrant would have to
provide the expiration dates of such leases, options or mineral
rights and associated payments.\971\
---------------------------------------------------------------------------

    \971\ See id.

    For each material property, the proposed rules also required a
registrant to disclose a history of previous operations, a description
of the condition and status of the property, and a description of any
significant encumbrances to the property, including current and future
permitting requirements and associated deadlines, permit conditions,
regulatory violations and associated fines.\972\
---------------------------------------------------------------------------

    \972\ See id.
---------------------------------------------------------------------------

    We also proposed to require several items of disclosure in tabular
form, including a summary of the exploration activity for the most
recently completed fiscal year (Table 4 of the proposed rules), a
summary of material exploration results for the most recently completed
fiscal year (Table 5 of the proposed rules), a summary of all mineral
resources and reserves (if mineral resources or reserves have been
determined) (Table 6 of the proposed rules), and a comparison of the
property's mineral resources and reserves as of the end of the last
fiscal year against the mineral resources and reserves as of the end of
the preceding fiscal year, with an explanation of any material change
between the two (Tables 7 and 8 of the proposed rules).\973\ A proposed
instruction provided that registrants would be permitted to modify the
tables for ease of presentation, to add information, or to combine two
or more required tables throughout their disclosure.\974\
---------------------------------------------------------------------------

    \973\ See id.
    \974\ See id.
---------------------------------------------------------------------------

    We further proposed that, if the registrant has not previously
disclosed mineral reserve or resource estimates in a filing with the
Commission or is disclosing material changes to its previously
disclosed mineral reserve or resource estimates, it must provide a
brief discussion of the material assumptions and criteria underlying
the estimates and cite to the corresponding sections of the technical
report summary, which would be filed as an exhibit.\975\ We similarly
proposed that, if the registrant has not previously disclosed material
exploration results in a filing with the Commission, or is disclosing
material changes to its previously disclosed exploration results, it
must provide sufficient information to allow for an accurate
understanding of the significance of the exploration results and cite
to corresponding sections of the summary technical

report, which would be filed as an exhibit.\976\
---------------------------------------------------------------------------

    \975\ See id.
    \976\ See id.
---------------------------------------------------------------------------

    We proposed additional individual property disclosure instructions
applicable to registrants that have not previously disclosed mineral
resource or reserve estimates or material exploration results or that
are disclosing a material change in previously disclosed mineral
resource or reserve estimates or material exploration results. Most of
those proposed instructions were designed to assist registrants in
determining whether there has been a material change in estimates of
mineral resources, mineral reserves, or material exploration results.
For example, according to one proposed instruction, whether a change in
exploration results, mineral resources, or mineral reserves, is
material must be based on all facts and circumstances, both
quantitative and qualitative. Pursuant to another proposed instruction,
a change in exploration results that significantly alters the potential
of the exploration target is considered material.
    Other proposed instructions would establish quantitative thresholds
for presumed materiality of a change in estimates of mineral resources
or reserves. For example, according to one proposed instruction, an
annual change in total resources or reserves of 10 percent or more,
excluding production as reported in Tables 7 and 8 of the proposed
rules, is presumed to be material, and thus would need to be
disclosed.\977\ According to another proposed instruction, a cumulative
change in total resources or reserves of 30 percent or more in absolute
terms, excluding production as reported in Tables 7 and 8 of the
proposed rules, from the current filed technical report summary is
presumed to be material. A third proposed instruction would require
that, when applying these quantitative thresholds for presumed
materiality, the registrant should consider the change in total
resources or reserves on the basis of total tonnage or volume of
saleable product.\978\
---------------------------------------------------------------------------

    \977\ See id.
    \978\ See id.
---------------------------------------------------------------------------

    We also proposed an instruction that would require a registrant to
consider whether the filed technical report summary is current with
respect to all material assumptions and information, including
assumptions relating to or underlying all modifying factors and
scientific and technical information (e.g., sampling data, estimation
assumptions, and methods). To the extent that the registrant is not
filing a technical report summary, but instead is basing the required
disclosure upon a previously filed report, that report would also have
to be current in these respects. If the previously filed report is not
current in these respects, the registrant would have to file a revised
or new summary technical report from a qualified person, which supports
the registrant's mining property disclosures.\979\
---------------------------------------------------------------------------

    \979\ See id.
---------------------------------------------------------------------------

    Finally, we proposed an instruction explaining that a report
containing estimates of the quantity, grade, or metal or mineral
content of a deposit or exploration results that a registrant has not
verified as a current mineral resource, mineral reserve, or exploration
results, and which was prepared before the registrant acquired, or
entered into an agreement to acquire, an interest in the property that
contains the deposit, would not be considered current and could not be
filed in support of disclosure.\980\
---------------------------------------------------------------------------

    \980\ See id.
---------------------------------------------------------------------------

ii. Comments on the Rule Proposal
    Many of the comments on the proposed individual property disclosure
requirements were substantially similar to the comments in response to
the proposed summary disclosure provisions. While commenters
acknowledged the importance of disclosure on individually material
properties,\981\ many believed the proposed disclosure requirements
were overly prescriptive and many were critical of one or more of the
proposed tables.\982\ One commenter opposed Tables 4-8 altogether
because of the level of detail required, which in the commenter's view
would likely result in any useful information being obscured, and which
would be overly burdensome for registrants to produce.\983\
---------------------------------------------------------------------------

    \981\ See, e.g., letters from Eggleston, Midas, and Rio Tinto.
    \982\ See letters from AIPG, Amec, AngloGold, BHP, CBRR, CIM,
Cleary & Gottlieb, Coeur, Davis Polk, Eggleston, FCX, Gold Resource,
Midas, MMSA, Newmont, NSSGA, Rio Tinto, SAMCODES 1, SME 1, SRK 1,
Vale, and Willis.
    \983\ See letter from Amec.
---------------------------------------------------------------------------

    Another commenter stated that certain proposed provisions, which
would require detailed information about leases, mining rights and
encumbrances, would likely result in over-disclosure of information
that is not material to investors.\984\ In addition, one commenter
stated that the Commission should revise the individual property
disclosure requirements in proposed Item 1304 to align it with the
checklist content and format in CRIRSCO Template Table 1.\985\
---------------------------------------------------------------------------

    \984\ See letter from Newmont; see also letter from Amec
(objecting to some of the proposed requirements as requesting
unnecessary detail for an annual disclosure filing, including the
requirement to provide: A summary of the exploration activity and
material exploration results for the most recently completed year; a
description of any significant encumbrances to the property; a
description of the titles, claims, concessions, mineral rights,
leases or options regarding the property; and a history of previous
operations) and letter from Cleary & Gottlieb (objecting to the
proposed requirement to disclose the age and physical condition of
the property on the grounds that it would not be useful to investors
and would be very burdensome to a company with significant mining
operations).
    \985\ See letter from BHP.
---------------------------------------------------------------------------

    Several commenters opposed requiring the proposed tables for
exploration activity and exploration results (Tables 4 and 5 of the
proposed rules) on the grounds that they are inconsistent with CRIRSCO
standards, are onerous to produce, and would result in disclosure that
is potentially competitively harmful, or would not be meaningful to
most investors.\986\ Some of the commenters opposed Tables 4 and 5 of
the proposed rules because, in their view, the tables implied that
drilling is the only form of exploration and ignored various other
forms of data collection and analysis, such as geochemical and
geophysical surveys, which are routinely used in exploration.\987\
Maintaining that it would be too difficult to include thousands of
datum points regarding exploration into a single table, those
commenters recommended that Tables 4 and 5 of the proposed rules either
should be eliminated from the final rules \988\ or allowed either in
narrative form or in company-designed tables.\989\
---------------------------------------------------------------------------

    \986\ See letters from Amec, AngloGold, Cleary & Gottlieb, FCX,
Midas, MMSA, SME 1, SRK 1, and Vale.
    \987\ See, e.g., letters from NSSGA, SME 1, SRK 1, and Vale.
    \988\ See, e.g., letters from SRK 1 (recommending removal of
proposed Table 5) and Vale (recommending removal of both proposed
Tables 4 and 5).
    \989\ See, e.g., letter from and SME 1; see also letter from
Cleary (recommending a principles-based approach generally to the
information required to be disclosed in tabular format, which would
allow a registrant and its qualified persons to exercise greater
judgment in determining the most suitable format and content of
material mining disclosure).
---------------------------------------------------------------------------

    While commenters generally supported the disclosure of mineral
resources and reserves in tabular format,\990\ most commenters that
addressed the issue were critical of Table 6 of the proposed rules in
various respects. Several commenters opposed proposed Table 6 on the
grounds that it would require the disclosure of mineral resources and
reserves in the same table, as well as inferred resources alongside

indicated and measured mineral resources, which would be inconsistent
with CRIRSCO standards.\991\ Commenters also opposed proposed Table 6
because it would require the disclosure of mineral reserves net of
allowances for dilution and losses, which would be contrary to industry
practice under the CRIRSCO-based codes.\992\ For similar reasons, some
commenters also opposed proposed Table 6 because it would require the
disclosure of mineral resources as exclusive of mineral reserves.\993\
One of those commenters stated that a registrant should be permitted to
disclose mineral resources as inclusive or exclusive of mineral
reserves as long as it clearly explains the basis of its disclosed
estimate.\994\
---------------------------------------------------------------------------

    \990\ See, e.g., letters from AngloGold, Eggleston, and Rio
Tinto.
    \991\ See letters from AIPG, BHP, CBRR, CIM, and SME 1.
    \992\ See letters from BHP, CIM, Newmont, and SRK 1.
    \993\ See letters from AngloGold, BHP, and JORC.
    \994\ See letter from JORC.
---------------------------------------------------------------------------

    Numerous commenters also opposed proposed Table 6 because it would
require the disclosure of mineral reserves on the basis of three points
of reference.\995\ Commenters maintained that, to be consistent with
the CRIRSCO-based codes, the Commission should only require the
disclosure of mineral resources on an in situ basis \996\ and reserves
on a run of mine \997\ or saleable product basis.\998\
---------------------------------------------------------------------------

    \995\ See letters from Amec, BHP, CIM, Eggleston, JORC, MMSA,
Newmont, Randgold, Royal Gold, SME 1, and SRK 1.
    \996\ See, e.g., letters from Amec, CIM, Newmont, Randgold, and
Rio Tinto.
    \997\ See, e.g., letters from CIM, Randgold, and SME 1.
    \998\ See, e.g., letters from MMSA, Randgold, and SME 1; see
also letters from CBRR and FCX (recommending the reporting of
reserves as run-of-mine (plant/mill feed) ore tons, contained
product before plant recovery and saleable product after plant
recovery).
---------------------------------------------------------------------------

    One commenter stated that proposed Table 6 incorrectly suggests
that different types of mining projects are comparable, which is
inconsistent with the diversity found in the mining industry.\999\
Another commenter opposed the overly prescriptive nature of Table 6 and
recommended leaving its inclusion and format to the discretion of the
qualified person.\1000\
---------------------------------------------------------------------------

    \999\ See letter from SME 1; see also letter from JORC
(generally opposing all of the tables as being inconsistent with the
diversity in the mining industry).
    \1000\ See letter from Vale.
---------------------------------------------------------------------------

    In addition, many commenters opposed Table 6 because it would
require the determination and disclosure of mineral resources and
reserves based on a 24-month trailing average price.\1001\ Some
commenters further objected to the inclusion of the total cost or book
value of a mining property and the commodity price in the case of
commodities traded under contract, the terms of which are
confidential.\1002\
---------------------------------------------------------------------------

    \1001\ See letters from AIPG, Alliance, AngloGold, BHP, CBRR,
Chamber, CIM, Cleary & Gottlieb, Coeur, Davis Polk, Dorsey &
Whitney, Eggleston, Gold Resource, Newmont, NMA 1, Northern Dynasty,
Randgold, Rio Tinto, SAMCODES 1 and 2, Shearman & Sterling, SME 1,
Vale, and Willis.
    \1002\ See, e.g., letter from BHP; see also letter from NSSGA
(opposing the disclosure of a weighted contract price in Table 3 on
similar grounds).
---------------------------------------------------------------------------

    One commenter supported the proposed reconciliation requirement in
Tables 7 and 8 of the proposed rules because ``[r]econciliation between
numbers on consecutive fiscal years is important to validate
uncertainty assumptions and resource/reserve classification.'' \1003\
Other commenters either supported proposed Tables 7 and 8 with little
to no discussion \1004\ or supported having a reconciliation
requirement while disagreeing with various aspects of the proposed
tabular format.\1005\ Some commenters objected to the high granularity
of disclosure required in proposed Tables 7 and 8, which they stated
would impose a significant reporting burden for a registrant with a
large number of properties reported.\1006\ Noting that the mining
industry has only formalized reconciliation reporting in the past 10
years, and stating that obtaining accurate reconciliation has been
difficult for a variety of reasons, other commenters recommended that
the Commission make resource and reserve reconciliation
voluntary.\1007\
---------------------------------------------------------------------------

    \1003\ Letter from CBRR.
    \1004\ See letter from Gold Resource.
    \1005\ See letter from AngloGold (supporting the proposed
requirement for reconciliation, but also recommending leaving the
``level of granularity in the reconciliation'' to the discretion of
the qualified person); letter from Eggleston (stating that requiring
a comparison of mineral resources and reserves would be useful, but
also maintaining that a meaningful comparison of mineral reserves
could not be obtained using the proposed table); and letter from SRK
1 (stating that the proposed tables may provide useful information
to a technically knowledgeable reader but may also create confusion
for investors).
    \1006\ See letters from Amec, MMSA, and Rio Tinto.
    \1007\ Letters from AIPG and SME 1; see also letter from Vale
(recommending that inclusion and format of Tables 7 and 8 be left to
the discretion of the qualified person).
---------------------------------------------------------------------------

    Some commenters provided conditional support for the Commission's
proposed requirement to provide a discussion of the material
assumptions underlying a registrant's disclosure of mineral resources,
mineral reserves, or material exploration results when first disclosing
them or when disclosing material changes to the previously disclosed
estimates and results.\1008\ One commenter stated that it supported the
Commission's proposed requirement to provide a discussion of material
assumptions as long as the Commission deemed the summaries prepared for
CRIRSCO reporting (e.g., based on JORC Table 1) to be acceptable for
Commission reporting purposes.\1009\
---------------------------------------------------------------------------

    \1008\ See, e.g., letters from AngloGold, CBRR, Eggleston,
Midas, Rio Tinto, and SRK 1.
    \1009\ See letter from Rio Tinto.
---------------------------------------------------------------------------

    Another commenter supported the proposed disclosure requirement for
material assumptions but opposed any prescriptive requirement, such as
the proposed percentage thresholds that would trigger when a material
change has occurred, relating to such disclosure.\1010\ A third
commenter stated that, consistent with international practice, a
detailed discussion of the material assumptions should be included in
the technical report while a summary of material assumptions should
occur in annual filings.\1011\ This commenter, however, stated that
while the proposed instruction, providing that an annual change in
total resources or reserves of 10% or more is presumed to be material,
was reasonable, a change of 25% might be better.\1012\ A fourth
commenter approved of the 30% cumulative change threshold while
recommending a 15% threshold for an annual change.\1013\ A fifth
commenter believed that the 10% threshold for defining a material
change for both mineral resources and reserves was too narrow. That
commenter recommended allowing the qualified person to determine when a
material change has occurred.\1014\
---------------------------------------------------------------------------

    \1010\ See letter from AngloGold.
    \1011\ See letter from Eggleston.
    \1012\ See id.
    \1013\ See letter from CBRR.
    \1014\ See letter from Newmont. Another commenter suggested a
25% materiality threshold for contained metal in reserves and a 50%
threshold for contained metal in resources together with an
``additional overriding qualitative obligation that any change the
registrant deems a material change should be disclosed.'' Letter
from Midas.
---------------------------------------------------------------------------

    In response to our request for comment, most commenters that
addressed the issue opposed requiring presentation of Tables 4 through
8 of the proposed rules in XBRL format.\1015\ Commenters primarily
objected to such a requirement because it would be expensive \1016\
and, ``given the uniqueness of the information to the registrant,''
they did not feel there was any useful information that would benefit
from being presented in a

structured format.\1017\ One commenter, however, supported requiring
the presentation of proposed Tables 4 through 8 in XBRL because it
would ``likely benefit investors and potential investors as well as
align SEC reporting requirements with potential industry standards in
the near future.'' \1018\
---------------------------------------------------------------------------

    \1015\ See, e.g., letters from AIPG, Alliance, Amec, AngloGold,
CBRR, Chamber, Eggleston, MMSA, Rio Tinto, and SME 1.
    \1016\ See letter from SME 1.
    \1017\ Letter from AngloGold; see also letters from AIPG and SME
1.
    \1018\ Letter from SRK 1.
---------------------------------------------------------------------------

    Some commenters recommended that, consistent with CRIRSCO
standards, such as NI 43-101 \1019\ and JORC, but contrary to the
Commission's proposal, the Commission allow a registrant and its
qualified person(s) to use historical estimates of the quantity, grade
or mineral content of a deposit that the registrant has not verified
and that was prepared before the registrant acquired or entered into an
agreement to acquire an interest in the property containing the
deposit.\1020\ As two of those commenters explained, the inability to
use historical estimates in a Commission filing could render a proposed
acquisition a practical impossibility because there could be
insufficient time to complete an independent estimate of the resources
or reserves for the target property.\1021\
---------------------------------------------------------------------------

    \1019\ As one of the commenters explained, under Canada's NI 43-
101, the use of a historical estimate is contingent upon the
registrant disclosing: The date and source of the historical
estimate; the relevance and reliability of the historical estimate;
the key assumptions, parameters and methods used to prepare the
historical estimate if known; the work that needs to be done to
upgrade or verify the historical estimate; and that the qualified
person has not done sufficient work to classify the historical
estimate as a current estimate and, therefore, the registrant is not
treating the historical estimate as a current estimate of mineral
resources or reserves. See letter from Coeur.
    \1020\ See letters from Amec, Coeur, Gold Resource, Newmont, and
NMA 1.
    \1021\ See letters from Newmont and NMA 1.
---------------------------------------------------------------------------

iii. Final Rules

    With modifications, we are adopting the proposed requirement that a
registrant with material mining operations must disclose certain
information about each property that is material to its business or
financial condition.\1022\ When determining the materiality of a
property relative to its business or financial condition, a registrant
must apply the same standards and other considerations to each
individual property as required when determining whether its mining
operations as a whole are material.\1023\ We continue to believe that,
because summary property disclosure alone will not provide all relevant
information about the properties and assets that generate a mining
registrant's revenues, detailed disclosure regarding a registrant's
individually material properties is necessary to provide investors with
a comprehensive understanding of a registrant's mining operations.
---------------------------------------------------------------------------

    \1022\ 17 CFR 229.1304(a)(1) [Item 1304(a)(1) of Regulation S-
K].
    \1023\ See id. The registrant would have to apply those
standards and other considerations to each individual property that
it owns or in which it has, or it is probable that it will have, a
direct or indirect economic interest. It also would have to provide
individual disclosure for each material property that it operates,
or it is probable that it will operate, under a lease or other legal
agreement that grants the registrant ownership or similar rights
that authorize it, as principal, to sell or otherwise dispose of the
mineral. Further, a registrant would have to provide individual
disclosure for each material property for which it has, or it is
probable that it will have, an associated royalty or similar right,
unless the registrant lacks access to the information about the
underlying properties, as specified in Item 1304(b) of Regulation S-
K, and the registrant meets the conditions for omitting the
individual property disclosure pursuant to Item 1304(a)(2) of
Regulation S-K. See supra Section II.B.4.
---------------------------------------------------------------------------

    As proposed, the final rules require a registrant to provide a
brief description of each material property, including: the property's
location; \1024\ existing infrastructure, including roads, railroads,
airports, towns, ports, sources of water, electricity, and personnel;
\1025\ and a brief description, including the name or number and size
(acreage), of the titles, claims, concessions, mineral rights, leases
or options under which the registrant and its subsidiaries have or will
have the right to hold or operate the property.\1026\
---------------------------------------------------------------------------

    \1024\ See Item 1304(b)(1)(i) of Regulation S-K [17 CFR
229.1304(b)(1)(i)], which requires the description of the property's
location to be accurate to within one mile, using an easily
recognizable coordinate system, including appropriate maps, with
proper engineering detail (such as scale, orientation, and titles)
that must be legible on the page when printed. We continue to
believe that this level of detail is similar to the level of detail
required by the CRIRSCO-based codes. See, e.g., PERC Reporting
Standard, supra note 302, Table 1 (requirement on key plan, maps and
diagrams, which calls for ``a location or index map and more
detailed maps showing all important features described in the text,
including all relevant cadastral and other infrastructure features .
. . All maps, plans and sections noted in this checklist, should be
legible, and include a legend, coordinates, coordinate system, scale
bar and north arrow''). See also SAMREC Code, supra note 267, Table
1 (calling for a ``detailed topo-cadastral map'').
    \1025\ 17 CFR 229.1304(b)(1)(ii) [Item 1304(b)(1)(ii) of
Regulation S-K].
    \1026\ Item 1304(b)(1)(iii) of Regulation S-K [17 CFR
229.1304(b)(1)(iii)], which also requires a description of how such
property rights were obtained at this location, indicating any
conditions that the registrant must meet in order to obtain or
retain the property. If held by leases or options or if the mineral
rights otherwise have termination provisions, the registrant must
provide the expiration dates of such leases, options, or mineral
rights and associated payments.
---------------------------------------------------------------------------

    Further, as proposed, the final rules will require registrants with
individually material mining properties to provide, as relevant to each
material property: A brief description of the present condition of the
property, the work completed by the registrant on the property, the
registrant's proposed program of exploration or development, the
current stage of the property as exploration, development or
production, the current state of exploration or development of the
property, and the current production activities; \1027\ the age,
details as to modernization and physical condition of the equipment,
facilities, infrastructure, and underground development; \1028\ the
total cost for or book value of the property and its associated plant
and equipment; \1029\ a brief history of previous operations, including
the names of previous operators, insofar as known; \1030\ and a brief
description of any significant encumbrances to the property, including
current and future permitting requirements and associated timelines,
permit conditions, and violations and fines.\1031\
---------------------------------------------------------------------------

    \1027\ Item 1304(b)(2)(i) of Regulation S-K [17 CFR
229.1304(b)(2)(i)], which also requires the registrant to identify
mines as either surface or underground, with a brief description of
the mining method and processing operations. If the property is
without known reserves and the proposed program is exploratory in
nature or the registrant has started extraction without determining
mineral reserves, the registrant must provide a statement to that
effect.
    \1028\ 17 CFR 229.1304(b)(2)(ii) [Item 1304(b)(2)(ii) of
Regulation S-K].
    \1029\ 17 CFR 229.1304(b)(2)(iii) [Item 1304(b)(2)(iii) of
Regulation S-K].
    \1030\ 17 CFR 229.1304(b)(2)(iv) [Item 1304(b)(2)(iv) of
Regulation S-K].
    \1031\ 17 CFR 229.1304(b)(2)(v) [Item 1304(b)(2)(v) of
Regulation S-K].
---------------------------------------------------------------------------

    Although several commenters opposed some of these individual
disclosure requirements on the basis that they are too prescriptive and
would be burdensome on registrants,\1032\ the above items of disclosure
are substantially similar to items called for by Item 102 of Regulation
S-K and Guide 7.\1033\ Also, these disclosures are

substantially similar to what is called for under CRIRSCO-based
rules.\1034\ We continue to believe that these items elicit material
information for investors.
---------------------------------------------------------------------------

    \1032\ See letters from Alliance, Amec, BHP, CBRR, FCX, Newmont,
and SRK 1.
    \1033\ For example, paragraph (b) of Guide 7 calls for
registrants to disclose the location and means of access to the
property, a description of the title, claim, lease or option under
which the registrant operates the property with appropriate maps to
portray the location, a history of previous operations, a
description of the present condition of the property, the work
completed by the registrant on the property, the registrant's
proposed program of exploration and development, the current state
of exploration or development of the property, and a description of
the rock formations and mineralization of existing or potential
economic significance on the property, including the identity of the
principal metallic or other constituents insofar as known.
    \1034\ See, e.g., ASX Listing Rules 5.1 and 5.3, which call for
similar disclosures including, as relevant to mining exploration or
production entities, details of exploration activities, mining
production and development activities, exploration, mining and
development expenditures, and information on mining tenements.
---------------------------------------------------------------------------

    Similar to a proposed instruction, the final rules include a
provision that establishes guidelines for classifying the current stage
of a property as exploration, development, or production.\1035\ Also as
proposed, a second provision advises registrants to include only
geological information that is brief and relevant to property
disclosure rather than an extensive description of regional
geology.\1036\ We believe that this latter provision is consistent with
the transparency principle under the CRIRSCO standards and will help
investors better understand a registrant's mining operations.
---------------------------------------------------------------------------

    \1035\ See supra Section II.B.5.iii (discussing Item 1304(c)(1)
of Regulation S-K).
    \1036\ 17 CFR 229.1304(c)(2) [Item 1304(c)(2) of Regulation S-
K].
---------------------------------------------------------------------------

    As proposed, we are adopting final rules that would require a
registrant to disclose, if mineral resources or reserves have been
determined, a summary of all mineral resources or reserves as of the
end of the most recently completed fiscal year.\1037\ While we are
still requiring the same disclosure, in response to those commenters
who noted that reporting mineral resources and reserves together is
counter to the principles of the CRIRSCO-based codes and could cause
investor confusion, we are modifying the presentation of the
disclosure.\1038\ Consequently, instead of one table (proposed Table
6), the final rules require that, for each property, the registrant
disclose in tabular format, as provided in Table 1 to paragraph (d) of
Item 1304, for each class of mineral resources (measured, indicated,
and inferred), together with total measured and indicated mineral
resources, the estimated tonnages and grades (or quality, where
appropriate), and in Table 2 to paragraph (d) of Item 1304, for each
class of mineral reserves (proven and probable), together with total
mineral reserves, the estimated tonnages, grades (or quality, where
appropriate), cut-off grades and metallurgical recovery. Furthermore,
consistent with our approach to summary disclosure and in light of
commenters' concerns about requiring three points of reference, the
disclosures in these Tables 1 and 2 will be based on a specific point
of reference selected by a qualified person.\1039\ The registrant must
disclose the selected point of reference for each of Tables 1 and 2 to
paragraph (d) of Item 1304.\1040\
---------------------------------------------------------------------------

    \1037\ 17 CFR 229.1304(d)(1).
    \1038\ See supra note 991 and accompanying text.
    \1039\ See 17 CFR 229.1304(d)(1).
    \1040\ See id..
---------------------------------------------------------------------------

    Similar to a proposed instruction, we are adopting an instruction
that would permit a registrant to modify the tabular formats in these
Tables 1 and 2 for ease of presentation, to add information, or to
combine two or more required tables.\1041\ This instruction is intended
to provide registrants with the flexibility to organize the required
data to fit their own particular circumstances. For example, depending
on the number of individually material properties owned or operated, a
registrant may decide to disclose mineral resources on separate
properties all in one table or in multiple tables, and mineral reserves
on separate properties all in one table or in multiple tables. The
adopted instruction makes clear, however, that when combining tables,
the registrant should not report mineral resources and reserves in the
same table.\1042\
---------------------------------------------------------------------------

    \1041\ Instruction 1 to 17 CFR 229.1304(d)(1). As previously
noted, a registrant may not modify the required tables to remove any
of the required disclosure from the tables.
    \1042\ See id.
---------------------------------------------------------------------------

    Another provision states that all disclosure of mineral resources
by the registrant must be exclusive of mineral reserves.\1043\ We are
adopting this provision for the same reasons as our adoption of a
substantially similar provision for summary disclosure.\1044\
---------------------------------------------------------------------------

    \1043\ 17 CFR 229.1304(d)(2) [Item 1304(d)(2) of Regulation S-
K].
    \1044\ See supra note 959 and accompanying text. As previously
discussed, see supra Section II.B.4., a third instruction states
that a registrant with only a royalty interest should provide only
the portion of the resources or reserves that are subject to the
royalty or similar agreement. See 17 CFR 229.1304(d)(3).
---------------------------------------------------------------------------

    We are adopting rules that, as proposed, will require a registrant
to compare each material property's mineral resources and reserves as
of the end of the last fiscal year with the mineral resources and
reserves as of the end of the preceding fiscal year, and explain any
material change between the two.\1045\ However, unlike our rule
proposal, and in response to comments received about various challenges
associated with providing this disclosure,\1046\ the final rules
provide that the comparison may be in either narrative or tabular
format. This will provide registrants greater flexibility in presenting
their disclosure and should help limit the compliance burden for
registrants, especially those with large numbers of reported
properties. Like the proposed rules, the final rules specify that the
comparison must disclose information concerning:
---------------------------------------------------------------------------

    \1045\ 17 CFR 229.1304(e) [Item 1304(e) of Regulation S-K].
    \1046\ See supra note 1005.

     The mineral resources or reserves at the end of the
last two fiscal years;
     The net difference between the mineral resources or
reserves at the end of the last completed fiscal year and the
preceding fiscal year, as a percentage of the resources or reserves
at the end of the fiscal year preceding the last completed one;
     An explanation of the causes of any discrepancy in
mineral resources including depletion or production, changes in
commodity prices, additional resources discovered through
exploration, and changes due to the methods employed; and
     An explanation of the causes of any discrepancy in
mineral reserves including depletion or production, changes in the
resource model, changes in commodity prices and operating costs,
changes due to the methods employed, and changes due to acquisition
or disposal of properties.\1047\
---------------------------------------------------------------------------

    \1047\ 17 CFR 229.1304(e)(1)-(4) [Items 1304(e)(1)-(4) of
Regulation S-K].

    This comparative disclosure requirement will help investors
understand the reasons for the year to year changes in a registrant's
mineral resources and reserves, which should help them analyze and
evaluate a registrant's future prospects. While Guide 7 calls for
annual disclosure of mineral reserves, it does not call for registrants
to compare their current mineral reserve disclosure with previously
provided disclosure. Registrants, however, provide much of the
disclosure required under the comparative disclosure provision pursuant
to current disclosure practices.\1048\
---------------------------------------------------------------------------

    \1048\ See, e.g., letters from AngloGold, CBRR, and Eggleston.
---------------------------------------------------------------------------

    If the registrant has not previously disclosed mineral reserve or
resource estimates in a Commission filing or is disclosing material
changes to its previously disclosed mineral reserve or resource
estimates, we are adopting rules, as proposed, requiring it to provide
a brief discussion of the material assumptions and criteria underlying
the estimates.\1049\ The material assumptions and criteria will depend
on the specific facts and circumstances surrounding the particular
property and the mineral resource and reserve estimates.\1050\ However,
the disclosure of these assumptions and criteria must include all of
the material information necessary

for investors reasonably to understand the disclosed mineral resources
or reserves. In addition, the registrant must cite to corresponding
sections of the technical report summary if one is filed as an exhibit
pursuant to Item 1302(b).\1051\
---------------------------------------------------------------------------

    \1049\ 17 CFR 229.1304(f)(1) [Item 1304(f)(1) of Regulation S-
K].
    \1050\ 17 CFR 229.1304(f)(3) [Item 1304(f)(3) of Regulation S-
K].
    \1051\ See 17 CFR 229.1304(f)(1).
---------------------------------------------------------------------------

    As previously discussed, we have revised the proposed rules to
state that, if a registrant is disclosing exploration activity and
exploration results for any material property for its most recently
completed fiscal year, it must provide summaries that include certain
specified information.\1052\ For exploration activity, the summary must
describe, for each material property as relevant, the sampling methods
used, and, for each sampling method used, the number of samples, the
total size or length of the samples, and the total number of
assays.\1053\ For exploration results, the summary must identify, for
each relevant material property, the hole, trench or other sample that
generated the exploration results, describe the length, lithology, and
key geologic properties of the exploration results, and include a brief
discussion of the exploration results' context and relevance.\1054\ If
the summary of exploration results only includes results from selected
samples and intersections, it should be accompanied with a discussion
of the context and justification for excluding other results.\1055\
---------------------------------------------------------------------------

    \1052\ See supra Section II.D.3.
    \1053\ 17 CFR 229.1304(g)(1) [Item 1304(g)(1) of Regulation S-
K].
    \1054\ 17 CFR 229.1304(g)(2) [Item 1304(g)(2) of Regulation S-
K].
    \1055\ See id.
---------------------------------------------------------------------------

    In a change from the proposed rules, in response to comments
received, the final rules will permit registrants to provide the
summaries of exploration activity and exploration results in narrative
or tabular format.\1056\ We believe this change will address the
concerns of commenters that opposed Tables 4 and 5 of the proposed
rules because those tables suggested that drilling is the only form of
exploration and because it would be too difficult to include thousands
of datum points regarding exploration into a single table.\1057\ We
agree that, as some commenters suggested, permitting registrants to
provide disclosure on exploration activity and exploration results in
narrative or tabular format will help limit the final rules' compliance
burden while still providing important benefits to investors.\1058\
---------------------------------------------------------------------------

    \1056\ 17 CFR 229.1304(g)(3) [Item 1304(g)(3) of Regulation S-
K].
    \1057\ See, e.g., letters from Cleary & Gottlieb, NSSGA, SME 1,
SRK 1, and Vale.
    \1058\ See letters from Cleary & Gottlieb and SME 1. Whether in
narrative or tabular format (and, if in tabular format, whether the
tables are similar to proposed Tables 4 and 5 or are tables designed
by the registrant), the disclosure of exploration activity and
material exploration results must be reasonably comprehensive and
not omit material facts that may make the disclosure misleading.
---------------------------------------------------------------------------

    As previously noted, the final rules permit a registrant to
disclose an exploration target when discussing exploration results or
exploration activity related to a material property as long as the
disclosure is accompanied by the cautionary and explanatory statements
specified in Item 1302(c) of Regulation S-K.\1059\ Consistent with
similar requirements under the CRIRSCO-based codes, the disclosure
about an exploration target will help investors understand the
significance of a registrant's disclosed exploration results and
exploration activities, while the required accompanying statements will
help investors understand the conceptual basis and limitations of the
exploration target.\1060\
---------------------------------------------------------------------------

    \1059\ See 17 CFR 229.1304(g)(5).
    \1060\ See supra Section II.D.3.
---------------------------------------------------------------------------

    Similar to the disclosure requirement for mineral resources or
mineral reserves, if the registrant has not previously disclosed
exploration results in a filing with the Commission, or is disclosing
material changes to its previously disclosed exploration results, the
final rules require it to provide sufficient information to allow for
an accurate understanding of the significance of the exploration
results.\1061\ This must include information such as exploration
context, type and method of sampling, sampling intervals and methods,
relevant sample locations, distribution, dimensions, and relative
location of all relevant assay and physical data, data aggregation
methods, land tenure status, and any additional material information
that may be necessary to make the disclosure concerning the
registrant's exploration results not misleading. The registrant must
cite to corresponding sections of the summary technical report if one
is filed.\1062\
---------------------------------------------------------------------------

    \1061\ 17 CFR 229.1304(g)(6)(i) [Item 1304(g)(6)(i) of
Regulation S-K].
    \1062\ See id.
---------------------------------------------------------------------------

    Similar to proposed instructions, we also are adopting individual
property disclosure provisions applicable to registrants that have not
previously disclosed mineral resource or reserve estimates or
exploration results or that are disclosing a material change in
previously disclosed mineral resource or reserve estimates or
exploration results. Most of these provisions are designed to assist
registrants in determining whether there has been a material change in
estimates of mineral resources, mineral reserves, or exploration
results. For example, a pair of provisions explains that whether a
change in exploration results, mineral resources, or mineral reserves,
is material must be based on all facts and circumstances, both
quantitative and qualitative.\1063\ Another provision states that a
change in exploration results that significantly alters the potential
of the subject deposit is considered material.\1064\
---------------------------------------------------------------------------

    \1063\ 17 CFR 229.1304(f)(3) [Item 1304(f)(3) of Regulation S-
K]; and 17 CFR 229.1304(g)(6)(ii) [Item 1304(g)(6)(ii) of Regulation
S-K].
    \1064\ 17 CFR 229.1304(g)(6)(iii) [Item 1304(g)(6)(iii) of
Regulation S-K].
---------------------------------------------------------------------------

    In a change from the proposed rules, we are not providing
quantitative guidance for what is presumed to be a material change in
estimates of mineral resources or reserves. We have been persuaded by
commenters that objected to the proposed quantitative guidance as being
overly prescriptive.\1065\
---------------------------------------------------------------------------

    \1065\ See, e.g., letter from AngloGold.
---------------------------------------------------------------------------

    If material assumptions in the filed technical report summary are
no longer valid, under current facts and circumstances, then using such
a technical report summary to support disclosure of mineral resources
or reserves can be misleading to investors. Consequently, we are
adopting a provision, similar to a proposed instruction, that requires
a filed technical report summary to be current with respect to all
material assumptions and information, including assumptions relating to
all modifying factors and scientific and technical information (e.g.,
sampling data, estimation assumptions and methods), as of the end of
the registrant's most recently completed fiscal year.\1066\ To the
extent that the registrant is not filing a technical report summary but
instead is basing the required disclosure upon a previously filed
report, that report must also be current in these material respects. If
the previously filed report is not current in these material respects,
the registrant must file a revised or new summary technical report from
a qualified person that supports the registrant's mining property
disclosures.\1067\
---------------------------------------------------------------------------

    \1066\ 17 CFR 229.1304(f)(2) [Item 1304(f)(2) of Regulation S-
K].
    \1067\ See id.
---------------------------------------------------------------------------

    Finally, we are adopting a provision stating that a report
containing one or more estimates of the quantity, grade, or metal or
mineral content of a deposit or exploration results that a registrant
has not verified as a current mineral

resource, mineral reserve, or exploration results, and which was
prepared before the registrant acquired, or entered into an agreement
to acquire, an interest in the property that contains the deposit
(i.e., a ``historical estimate''), is not considered current and cannot
be filed in support of disclosure.\1068\
---------------------------------------------------------------------------

    \1068\ 17 CFR 229.1304(h) [Item 1304(h) of Regulation S-K].
---------------------------------------------------------------------------

    However, in a change from the proposed rules, and as a result of
comments received, we are adopting a targeted accommodation that
permits a registrant to include a historical estimate in a Commission
filing that pertains to a merger, acquisition, or business combination
if the registrant is unable to update the estimate prior to the
completion of the relevant transaction. In that event, when referring
to the estimate, the registrant must disclose the source and date of
the estimate, and state that a qualified person has not done sufficient
work to classify the estimate as a current estimate of mineral
resources, mineral reserves, or exploration results, and that the
registrant is not treating the estimate as a current estimate of
mineral resources, mineral reserves, or exploration results.\1069\
These conditions are generally consistent with those required for the
use of historical estimates under Canada's NI 43-101.\1070\ This change
should address the concern of commenters that the proposed prohibition
regarding the use of historical estimates could render some
acquisitions or other similar business transactions a practical
impossibility. At the same time, to mitigate any potential risk from
the use of older information, the adopted provision requires that
investors be provided with additional information to help them evaluate
an investment in a registrant that has engaged in a merger or similar
business transaction involving the use of a historical estimate.
---------------------------------------------------------------------------

    \1069\ See id.
    \1070\ See Canada's NI 43-101, supra note 123, at pt. 2.4.
---------------------------------------------------------------------------

    We believe these provisions will help a registrant determine when
it must file a technical report summary as an exhibit to the filing and
provide the appropriate accompanying disclosure in the filing about the
resource or reserve estimates and exploration results. At the same
time, the adopted provisions will help to ensure that investors are
provided with current information about the registrant's mineral
resources and reserves and exploration results.
    Like the proposed rules, the final rules do not require a
registrant to format any of its disclosure about its individually
material properties in XBRL. In light of the flexibility provided in
the final rules for these disclosures, which will permit registrants to
tailor the disclosures to their unique facts and circumstances, we
believe that presentation in a structured format, such as XBRL, would
impose additional burdens on registrants without providing substantial
additional benefits for users of the information.\1071\ For similar
reasons, we are not requiring registrants' summary disclosure to be
formatted in XBRL.
---------------------------------------------------------------------------

    \1071\ See supra notes 1015-1017 and accompanying text.
---------------------------------------------------------------------------

3. Requirements for Technical Report Summaries
i. Rule Proposal
    We proposed rules that would require a registrant to file, as an
exhibit, a technical report summary to support the disclosure of
mineral resources, mineral reserves, or material exploration results
for each material property.\1072\ The proposed rules would require a
qualified person to identify and summarize the scientific and technical
information and conclusions reached concerning material mineral
exploration results, initial assessments used to support disclosure of
mineral resources, and preliminary or final feasibility studies used to
support disclosure of mineral reserves, for each material property, in
the technical report summary.\1073\ The qualified person also would be
required to sign and date the technical report summary.\1074\ We
proposed this latter requirement to help ensure the reliability of the
technical report summary.
---------------------------------------------------------------------------

    \1072\ See Proposing Release, Section II.G.3.
    \1073\ See id.
    \1074\ See id.
---------------------------------------------------------------------------

    We proposed specific requirements for the contents of the technical
report summary to elicit scientific and technical information to
support the determination and disclosure of mineral resources, mineral
reserves, and material exploration results. The proposed requirements
are similar in most respects to the items of information required for
the summary report under Canada's NI 43-101.\1075\ They are also
similar to the contents suggested in the mining engineering
literature.\1076\ In the Proposing Release, we stated that these
similarities support our view that the proposed sections of the
technical report summary would provide relevant and useful information
to facilitate an investor's understanding of a registrant's mineral
resources, mineral reserves, and material exploration results.\1077\
---------------------------------------------------------------------------

    \1075\ See Canada's Form 43-101F1 (prescribing 27 sections for
the technical report summary required for each material property
pursuant to Canada's NI 43-101), http://web.cim.org/standards/documents/Block484_Doc111.pdf.
    \1076\ See, e.g., W. Hustrulid, M. Kuchta, and R. Martin, 1 Open
Pit Mine Planning & Design 14-16 (3rd ed. 2013); Richard West,
Preliminary, Prefeasibility and Feasibility Studies, Australian
Mineral Economics--A Survey of Important Issues (Philip Maxwell and
Pietro Guj, eds, 2006).
    \1077\ See Proposing Release, supra note 5, at Section II.G.
---------------------------------------------------------------------------

    We proposed that the technical report summary must not include
large amounts of technical or other project data, either in the report
or as appendices to the report.\1078\ In addition, the proposed rules
required the qualified person to draft the summary to conform, to the
extent practicable, with plain English principles under the Securities
Act and Exchange Act.\1079\ While the proposed requirements were
designed primarily to help improve the readability of the technical
report summary for the benefit of those investors who do not have a
technical scientific or engineering background, they would also benefit
more sophisticated investors to the extent that they result in a more
readable and understandable document. They also are consistent with
similar Canadian mining disclosure standards.\1080\
---------------------------------------------------------------------------

    \1078\ See id.
    \1079\ See 17 CFR 230.421 [Securities Act Rule 421] and 17 CFR
240.13a-20 [Securities Exchange Act Rule 13a-20].
    \1080\ See Instruction 3 to Form 43-101F1 (``The qualified
person preparing the technical report should keep in mind that the
intended audience is the investing public and their advisors who, in
most cases, will not be mining experts. Therefore, to the extent
possible, technical reports should be simplified and understandable
to a reasonable investor. However, the technical report should
include sufficient context and cautionary language to allow a
reasonable investor to understand the nature, importance, and
limitations of the data, interpretations, and conclusions summarized
in the technical report'').
---------------------------------------------------------------------------

    We proposed that the technical report summary consist of some or
all of 26 sections, depending upon the specific scope of the
summary.\1081\ As proposed, a technical report summary that reports the
results of a preliminary or final feasibility study would have to
include all 26 sections. A technical report summary that reports the
results of an initial assessment or that reports material exploration
results could omit information required by certain of the proposed
technical report summary sections.\1082\
---------------------------------------------------------------------------

    \1081\ See Proposing Release, supra note 5, at Section II.G.3.
    \1082\ See id.
---------------------------------------------------------------------------

    Although the proposed sections were similar in most respects to the
items of information required for the summary

report under Canada's NI 43-101,\1083\ there were a couple of notable
differences. First, the proposed rules did not permit a qualified
person to include a disclaimer of responsibility if he or she relies on
a report, opinion, or statement of another expert in preparing the
technical report summary.\1084\ Second, we proposed to include sections
about hydrogeology and geotechnical data, including testing and
analysis, which are not included in Canada's NI 43-101.
---------------------------------------------------------------------------

    \1083\ See supra note 1075 and accompanying text.
    \1084\ In contrast, Canada's NI 43-101 would permit the
qualified person to include a disclaimer of responsibility if he or
she relies on a report, opinion, or statement of another expert who
is not a qualified person in preparing the technical report summary.
See Item 3 of Canada's Form NI 43-101F1.
---------------------------------------------------------------------------

ii. Comments on the Rule Proposal
    While acknowledging that the Commission's proposal to require 26
specified sections in the technical report summary is similar to the
content required under Canada's NI 43-101, numerous commenters urged
the Commission to follow explicitly the content and format of Canada's
Form 43-101F1 so that technical report summaries filed with the
Commission would be interchangeable with technical reports prepared
under Canada's NI 43-101.\1085\ One of those commenters also
recommended that the Commission explicitly incorporate the Canadian
form by reference, ``which would allow for regular updates without
going through additional rulemaking.'' \1086\ Several other commenters,
however, recommended that the technical report summary follow the
format of CRIRSCO's Table 1 and the corresponding guidance in JORC or
SAMREC rather than the format and guidance under Canada's NI43-101
because they viewed the latter as being too prescriptive.\1087\ One of
those commenters further recommended that the Commission adopt ``carve-
outs'' for commercially sensitive information.\1088\ Another commenter
opposed the proposed technical report summary requirement as being too
prescriptive and recommended that the Commission refer U.S. registrants
to the 2014 SME Guide, which would be included as an appendix to the
final rules.\1089\
---------------------------------------------------------------------------

    \1085\ See letters from AIPG, Amec, Coeur, Eggleston, Gold
Resource, Northern Dynasty, SME 1, and Willis.
    \1086\ Letter from AIPG.
    \1087\ See letters from AngloGold, BHP, JORC, MMSA, Randgold,
Rio Tinto, and SAMCODES 1.
    \1088\ See letter from BHP.
    \1089\ See letter from CRIRSCO.
---------------------------------------------------------------------------

    Two commenters opposed the technical report summary filing
requirement on the grounds that it ``is a significant change to the
current SEC rules and goes beyond most CRIRSCO-based disclosure
regimes, other than Canada and Australia, which do not require filing
of expert reports.'' \1090\ One of those commenters also believed that
many of the required sections in the proposed technical report summary
seemed designed to satisfy some unstated social or political goal
rather than to provide material information to investors.\1091\ The
other commenter stated that the proposed rules would require a
registrant in the aggregates business to collect and report on data
that management typically does not use in its own analysis of its
business.\1092\ Because that commenter believed that many sections of
the technical report summary would result in immaterial information to
investors due to the nature of the aggregates industry, and because of
its concern that some of the requested information, such as pricing,
would place confidential business plan information into the public
domain to the detriment of its competitive position, the commenter
requested that the Commission exclude registrants in the aggregates
business from having to comply with the technical report summary
requirement.\1093\
---------------------------------------------------------------------------

    \1090\ See letters from Chamber and NSSGA.
    \1091\ See letter from Chamber.
    \1092\ See letter from NSSGA.
    \1093\ See id.
---------------------------------------------------------------------------

    One commenter who opposed the proposed technical report summary
because of its differences with CRIRSCO-based disclosure requirements
stated that ideally the Commission should adopt mining disclosure rules
that are substantially the same as the CRIRSCO-based codes. As an
alternative, however, that commenter recommended that the Commission
adopt a ``reciprocal recognition'' approach that would allow foreign
issuers to file their home country (CRIRSCO-based) reports in
satisfaction of the U.S. rules and U.S. issuers to file U.S. compliant
reports in satisfaction of foreign requirements.\1094\
---------------------------------------------------------------------------

    \1094\ See letter from PDAC.
---------------------------------------------------------------------------

    Several commenters recommended changing the name of the technical
report summary to either ``summary technical report'' or just
``technical report.'' \1095\ Commenters urged such a change in order to
align the name of the required report with that required under the
CRIRSCO-based codes and because the Commission's proposed name suggests
that there is a full technical report when in many instances there is
not.
---------------------------------------------------------------------------

    \1095\ See letters from AIPG, Coeur, Eggleston, Gold Resource,
Midas, and SME 1.
---------------------------------------------------------------------------

    Some commenters generally approved of the proposed 26 sections of
the technical report summary while suggesting modifications for certain
sections. For example, one commenter stated that adding sections on
hydrogeology and geotechnical would be appropriate for reserve
determination but not for resource estimation because such information
is typically not available.\1096\ Another commenter recommended
excluding those sections when disclosing exploration results for the
same reason.\1097\ A third commenter recommended excluding from the
technical report summary detailed hydrogeology and geotechnical data as
well as any other detailed technical data that most investors would not
find meaningful.\1098\
---------------------------------------------------------------------------

    \1096\ See letter from Midas; see also letter from MMSA.
    \1097\ See letter from Eggleston; see also letter from SRK 1
(recommending excluding those sections for both exploration results
and resource estimation).
    \1098\ See letter from Andrews & Kurth; see also letter from
Amec (recommending exclusion of hydrogeology and geotechnical
sections in conjunction with recommendation to exclude mineral
brines and geothermal energy from scope of rules).
---------------------------------------------------------------------------

    Another commenter, however, supported the inclusion of sections on
hydrology and rock mechanics.\1099\ This commenter agreed with most of
the topics included in the proposed technical report summary
requirement, but opposed requiring annual cash flow forecasts and
measures of economic viability, such as net present value, internal
rate of return and payback period of capital, under ``results of the
economic analysis'' on the grounds that such information is sensitive
and should only be requested under specific situations and afforded
confidential treatment.\1100\
---------------------------------------------------------------------------

    \1099\ See letter from CBRR.
    \1100\ Id.
---------------------------------------------------------------------------

    One commenter urged the Commission to adopt a technical report
summary provision requiring ``detailed descriptions of infrastructure
needs for mining projects, especially dams, tailings disposal, water
and energy access.'' \1101\ That commenter also supported adoption of
the technical report summary provision requiring descriptions of the
environmental, permitting, and social or community factors related to
the project, which the commenter indicated would include a description
of ``social license to operate'' risks.\1102\
---------------------------------------------------------------------------

    \1101\ Letter from Earthworks.
    \1102\ See Id.
---------------------------------------------------------------------------

    Another commenter disagreed with the proposed requirement that a

qualified person opine on whether all issues relating to all relevant
modifying factors can be resolved with further work. The commenter
further opposed the proposed provision requiring a qualified person to
justify the use of a pre-feasibility study instead of a feasibility
study. According to that commenter, because the CRIRSCO standards
require a pre-feasibility study to be sufficient for a competent
person, acting reasonably, to determine if all or part of a mineral
resource may be converted to a mineral reserve at the time of
reporting, no additional justification for use of a pre-feasibility
should be required.\1103\
---------------------------------------------------------------------------

    \1103\ See letter from Amec.
---------------------------------------------------------------------------

    In response to our solicitation of comment regarding whether we
should expand the disclosure required by the technical report summary,
most commenters \1104\ that addressed the issue did not favor expanding
the technical report summary provision that would require the qualified
person to describe the environmental, permitting, and social or
community factors related to the project.\1105\ One of those commenters
objected to expanding the mining property disclosure requirements to
include a more detailed discussion regarding sustainability and related
issues on the grounds that it already discloses material environmental,
social, and governance information for investors in its corporate
social responsibility reports that it publishes annually on its web
site.\1106\ The commenter further noted that, to the extent that
sustainability issues present a material risk, a registrant would
already have to disclose that risk in the Risk Factors section of its
Exchange Act annual report.\1107\
---------------------------------------------------------------------------

    \1104\ See letters from Alliance, Amec, AngloGold, CRIRSCO,
Eggleston, JORC, Midas, Newmont, NMA 1, Rio Tinto, SME 1, and SRK 1.
See also letter from CBRR (stating that the proposed items are
sufficient but suggesting that the Commission clarify that a
registrant may add ``any other significant information that is
relevant to the project'').
    \1105\ See, e.g., letter from Alliance (``We believe that
requiring disclosure of issues related to environmental, permitting
and social or community factors, such as how the registrant is going
to manage greenhouse gases, workforce health, safety and well-being,
within the technical report summary could require a qualified person
to attempt to estimate amounts or impacts for which they have no
expertise. . . . We believe that a qualified person should include
in the technical report those amounts that can be readily determined
based on the professional qualifications of the qualified person'').
    \1106\ See letter from Newmont.
    \1107\ See id.
---------------------------------------------------------------------------

    Some commenters, however, recommended that the Commission require a
registrant and its qualified person(s) to consider sustainability
factors when determining mineral resources and reserves.\1108\ For
example, one commenter suggested that the Commission explicitly require
a carbon budget analysis in the economic viability determination for
proven reserves.\1109\ This commenter also recommended that the
Commission: (i) Require the use of a spectrum of price forecasts and
sensitivity analysis in assessing the economic recoverability of a coal
deposit; and (ii) expand the definition of a qualified person to
require an expertise in conducting a carbon budget analysis.\1110\
---------------------------------------------------------------------------

    \1108\ See letters from Carbon Tracker, Columbia, CRIRSCO,
CSP\2\, Earthworks, and SASB.
    \1109\ See letter from Carbon Tracker. Such a provision would
require a qualified person, as part of his or her coal resource and
reserve determinations, to consider, as a modifying factor, whether
the reserve could be economically produced in a scenario in which
demand is consistent with the climate change prevention goal of
maintaining a global temperature increase of no greater than 2[deg]
C on an annual basis.
    \1110\ See id.
---------------------------------------------------------------------------

    Another commenter urged the Commission to require the consideration
of numerous sustainability topics when applying the modifying factors
in mineral resource and reserve determinations.\1111\ Under this
approach, for metals mining, a qualified person would have to consider
greenhouse gas emissions, air quality, biodiversity impacts, community
relations and rights of indigenous peoples, and workforce health,
safety, and well-being together with energy management, water
management, and waste and hazardous materials management. The commenter
further recommended that the Commission explicitly require a qualified
person to have relevant experience to assess and render judgment on any
potential modifying factor.\1112\
---------------------------------------------------------------------------

    \1111\ See letter from SASB.
    \1112\ See id; see also letter from CSP\2\ (stressing the
importance of identifying potential environmental liabilities in the
technical report summary); letter from Columbia (recommending
requiring in the technical report summary a detailed discussion of
three particular areas of water-related risk: Water scarcity;
tailings dam operation and extreme rainfall; and environmental
performance); and letter from Earthworks (recommending requiring a
registrant to disclose several additional material environmental and
social risks associated with its mining operations, including:
Externalized impacts resulting from a particular mining project that
fall upon the local community rather than the mining company; risks
resulting from a registrant's reliance on self-bonds and other
corporate guarantees; the potential for acid mine drainage and heavy
metal discharge as revealed by initial exploratory drilling; risks
from litigation or permit challenges; and local, regional, and state
government resolutions against a mining project).
---------------------------------------------------------------------------

    One commenter supported the consideration of climate,
environmental, social, safety, and health modifying factors both in
technical studies and company reports.\1113\ Noting that most companies
address sustainability issues in detail in separate reports, the
commenter recommended that sustainability information should only be
provided in a technical report in summary form.\1114\ Another commenter
noted that, although environmental and social matters have become
``extremely important'' in the estimation of mineral resources and
reserves, those matters are already part of the modifying factors
required to be considered under the CRIRSCO framework.\1115\
---------------------------------------------------------------------------

    \1113\ See letter from CRIRSCO.
    \1114\ See id.
    \1115\ See letter from JORC.
---------------------------------------------------------------------------

    One commenter requested clarification of two instructions to the
proposed technical report summary provision that requires a qualified
person to describe the current or proposed mineral processing methods
and the reasons for selecting these methods as the most suitable for
extracting the valuable products from the mineralization under
consideration. That commenter objected to the use of the term
``successfully'' to qualify processing methods, plant designs, and
other parameters that have not yet been used in a commercial production
of the valuable product from the mineralization under consideration
because he believed that the term was vague.\1116\ The commenter found
the phrase ``successfully extract'' to be technically vague and
questioned whether there is a particular scale at which extraction is
successful and whether ``successful'' means economically profitable or
technically demonstrated. The commenter recommended replacing
``successfully extract'' with ``commercially'' or ``in production.''
The commenter also stated that ``[f]urther clarification is warranted
to clarify if demonstration plants or pilot plant operations can be
used to warrant a process method as `successful'.'' \1117\
---------------------------------------------------------------------------

    \1116\ See letter from Moats.
    \1117\ Id. Another commenter recommended substituting for
proposed Instruction 2 to paragraph (b)(96)(iv)(B)(16) the
following: ``If the processing method, plant design or other
parameters have never been used to successfully extract the valuable
product from such mineralization and is still under development,
then it is the responsibility of the Qualified Person to assess the
scale and type of testing that has been completed and the entirety
of the metallurgical data to determine whether or not mineral
resources or mineral reserves can be disclosed. Justifications for
the disclosures must be fully reported and detailed.'' Letter from
Newmont. That commenter suggested this revised instruction to avoid
unnecessarily restricting the application of future processing
methods or designs in delineating resource and reserve estimates.
---------------------------------------------------------------------------

    Some commenters urged the Commission to modify the proposed

technical report summary provision requiring a qualified person to
describe the results of the economic analysis, including annual cash
flow forecasts based on an annual production schedule for the life of
the project. Those commenters requested that the Commission follow
Canada's NI 43-101 by allowing producing registrants to omit annual
cash flow forecasts unless a material expansion of existing production
is planned on the grounds that detailed information regarding costs,
production, and cash flow is confidential business information.\1118\
---------------------------------------------------------------------------

    \1118\ See letters from Amec, Newmont, SME 1, and Vale.
---------------------------------------------------------------------------

    Most commenters that addressed the issue agreed with the
Commission's proposal that the technical report summary not include
large amounts of technical or other project data either in the report
or as appendices to the report.\1119\ One commenter, however, stated
that technical reports must include sufficient data to demonstrate the
viability of mineral resources and mineral reserves, questioned the
point at which the number of data becomes ``large,'' and recommended
that the Commission require the inclusion of as much summary data as
practicable.\1120\ Another commenter stated that it is not necessary
that large amounts of technical data, such as hydrologic and
geotechnical information, be included as appendices in the technical
report as long as the information is publicly available and accessible,
and references to the information are provided.\1121\
---------------------------------------------------------------------------

    \1119\ See letters from Alliance, Amec, AngloGold, CBRR, Gold
Resource, Midas, Northern Dynasty, Rio Tinto, and SRK 1.
    \1120\ See letter from Eggleston.
    \1121\ See letter from CSP\2\.
---------------------------------------------------------------------------

    Most commenters that addressed the issue also supported the
Commission's proposal to require the public filing of the technical
report summary as an exhibit to the Commission filing in which the
registrant first discloses mineral resources, mineral reserves, or
material exploration results or reports a material change to the
previously disclosed estimates.\1122\ Some commenters, however, opposed
the proposed public filing requirement of a technical report summary on
the grounds that: Because currently only two jurisdictions (Canada and
Australia) require the public filing of a technical report summary, the
proposed requirement would result in an incremental reporting burden in
the United States relative to most other jurisdictions; \1123\ or the
technical report summary would require the inclusion of voluminous
amounts of technical data, some of which would be competitively
sensitive, and most of which would not be meaningful to investors, and
which would be burdensome to produce.\1124\ In lieu of a technical
report summary, one of those commenters suggested that the Commission
allow registrants to prepare reports in accordance with the guidelines
set forth in CRIRSCO Table 1 or JORC Table 1.\1125\
---------------------------------------------------------------------------

    \1122\ See letters from Amec, AngloGold, Carbon Tracker,
Eggleston, Gold Resource, Midas, Northern Dynasty, Rio Tinto, SME 1,
SRK 1, and Willis. Amec and Gold Resource supported the proposed
filing requirement for mineral resources and reserves but not for
material exploration results.
    \1123\ See letter from Davis Polk.
    \1124\ See letters from Alliance and FCX.
    \1125\ See letter from FCX.
---------------------------------------------------------------------------

iii. Final Rules
    Like the proposed rules, the final rules require a registrant
disclosing information concerning its mineral resources or mineral
reserves determined to be on a material property to file a technical
report summary by one or more qualified persons to support such
disclosure of mineral resources or reserves.\1126\ While the disclosure
requirements for the technical report summary are based in particular
on Canada's NI 43-101F1, they are substantially similar to the criteria
specified in CRIRSCO's Table 1 and JORC's Table 1, which must be
considered by the qualified or competent person when preparing reports
on exploration results, mineral resources, or mineral reserves.\1127\
---------------------------------------------------------------------------

    \1126\ 17 CFR 229.601(b)(96)(i) [Item 601(b)(96)(i) of
Regulation S-K].
    \1127\ There is substantial overlap in the substantive
requirements under Canada's NI 43-101F1 and the criteria specified
in CRIRSCO's Table 1 and JORC's Table 1. The primary difference
between Canada's NI 43-101F1 and the latter two Tables is in the
format and organization of the resulting report. The ``checklist''
format of the two Tables tends to result in more abbreviated
reporting than the more formal requirements of Canada's NI 43-101F1.
---------------------------------------------------------------------------

    Many commenters supported the Commission's proposal to require a
registrant to obtain a technical report summary from the qualified
person for each material property when first reporting estimates of
mineral resources or mineral reserves, or when reporting a material
change in previously reported estimates.\1128\ As one commenter
indicated, many mining companies, including U.S. registrants that are
cross-listed, already prepare technical reports in CRIRSCO-based
jurisdictions either for public filing or for internal use.\1129\ In
addition to Canada and Australia, other foreign jurisdictions have
adopted formal requirements for a technical report by a qualified or
competent person, which are substantially similar to our final rule
requirements.\1130\ This confirms our view that our technical report
summary requirement is consistent with the CRIRSCO standards and will
help promote comparability in the reporting by qualified persons.
---------------------------------------------------------------------------

    \1128\ See supra note 193 and accompanying text.
    \1129\ See letter from SRK 1.
    \1130\ For example, the South African SAMREC Code includes
requirements for a competent person's report that are substantially
similar to our final rule requirements and those under Canada's NI
43-101F1 both in terms of content and organizational format. The
SAMREC code recommends that all public disclosure of exploration
results, mineral resources, and mineral reserves include a competent
person's report or a reference to one. See SAMREC Code (2016), supra
note 267, Appendix 1. The London Stock Exchange and its Alternative
Investment Market also require a competent person's report from
mining issuers as part of their initial listing requirements. These
requirements are also similar to our final rule requirements. See
London Stock Exchange, AIM Note for Mining and Oil & Gas Companies
(June 2009).
---------------------------------------------------------------------------

    The final rules require that, for each material property, the
qualified person(s) must identify and summarize the scientific and
technical information and conclusions reached concerning initial
assessments used to support disclosure of mineral resources, or
concerning preliminary or final feasibility studies used to support
disclosure of mineral reserves, in the technical report summary.\1131\
The requirements for the contents of the technical report summary are
intended to elicit the scientific and technical information necessary
to support the determination and disclosure of mineral resources,
mineral reserves, and, as applicable, exploration results, to the
extent they are material to investors. Because these requirements are
similar in most respects to the items of information required for the
summary report under Canada's NI 43-101 \1132\ and the criteria
specified in CRIRSCO Table 1 and JORC Table 1 as well as to the
contents suggested in the mining engineering literature,\1133\ we
continue to believe that the specified sections of the technical report
summary will provide relevant and useful information to facilitate an
investor's understanding of a registrant's mineral resources, mineral
reserves, and material exploration results.
---------------------------------------------------------------------------

    \1131\ See Item 601(b)(96)(i) of Regulation S-K. As previously
discussed, see supra Section II.C.1.iii., each qualified person who
has prepared the technical report summary must sign and date the
technical report summary. If more than one qualified person has
prepared the technical report summary, the technical report summary
must clearly delineate the section or sections of the summary
prepared by each qualified person. See Item 1302(b)(1) of Regulation
S-K. The qualified person's signature must comply with 17 CFR
230.402(e) or 17 CFR 240.12b-11(d).
    \1132\ See supra note 1075 and accompanying text.
    \1133\ See supra note 1076 and accompanying text.

---------------------------------------------------------------------------

    While we are adopting the technical report summary requirements
largely as proposed,\1134\ in response to the concern of some
commenters \1135\ that the proposed technical report summary
requirement would impose an undue compliance burden on registrants, we
have made a number of changes in the required content of the technical
report summary. For example, the final rules clarify that the
information specified under the various sections of the technical
report summary is to be provided only to the extent that it is
material.\1136\ This clarification recognizes that, due to the
diversity of operations in the mining industry, some sections may
require little to no disclosure for certain registrants because those
sections are not material to an investor's understanding of their
particular mining operations.
---------------------------------------------------------------------------

    \1134\ 17 CFR 229.601(b)(96)(iii)(B) [Item 601(b)(96)(iii)(B) of
Regulation S-K], which is set forth in its entirety in Section VII,
below. A technical report summary that reports the results of a
preliminary or final feasibility study must include all of the
information specified in these sections. A technical report summary
that reports the results of an initial assessment or that reports
material exploration results could omit information required by
certain of these sections. See 17 CFR 229.601(b)(96)(iii)(A) [Item
601(b)(96)(iii)(A) of Regulation S-K].
    \1135\ See, e.g., letters from Chamber and NSSGA.
    \1136\ See Item 601(b)(96)(iii)(B) of Regulation S-K.
---------------------------------------------------------------------------

    Other revisions to the required content of the technical report
summary reflect changes to the proposed disclosure rules that have
already been discussed in some detail. We believe these changes will
help decrease the compliance burden of the technical report summary
requirement, relative to the proposed requirement. For example, the
final rules:

     No longer require the technical report summary to
include a quantitative assessment of risk for resource
determination; \1137\
---------------------------------------------------------------------------

    \1137\ See 17 CFR 229.601(b)(96)(iii)(B)(11)(v).
---------------------------------------------------------------------------

     permit the qualified person to disclose mineral
resource estimates that include mineral reserves; \1138\
---------------------------------------------------------------------------

    \1138\ See 17 CFR 229.601(b)(96)(iii)(B)(11)(ii) [Item
601(b)(96)(iii)(B)(11)(ii) of Regulation S-K ]. The qualified person
must also disclose mineral resource estimates that exclude the
mineral reserves.
---------------------------------------------------------------------------

     permit the qualified person to use any reasonable and
justifiable price when determining both mineral resource and reserve
estimates; \1139\
---------------------------------------------------------------------------

    \1139\ See 17 CFR 229.601(b)(96)(iii)(B)(11)(iii) [Item
601(b)(96) )(iii)(B)(11)(iii) of Regulation S-K]; and 17 CFR
229.601(b)(96)(iii)(B)(12)(iii) [Item 601(b)(96) )(iii)(B)(12)(iii)
of Regulation S-K ].
---------------------------------------------------------------------------

     permit the qualified person to estimate both mineral
resources and mineral reserves at a single point of reference
selected by the qualified person; \1140\
---------------------------------------------------------------------------

    \1140\ See 17 CFR 229.601(b)(96)(iii)(B)(11)(i) [Item
601(b)(96)(iii)(B)(11)(i) of Regulation S-K]; and 17 CFR
229.601(b)(96)(iii)(B)(12)(i) [Item 601(b)(96)(iii)(B)(12)(i) of
Regulation S-K].
---------------------------------------------------------------------------

     permit the qualified person to include inferred
resources in the technical report summary's economic analysis when
determining and disclosing mineral resource estimates; \1141\ and
---------------------------------------------------------------------------

    \1141\ See 17 CFR 229.601(b)(96)(iii)(B)(19)(iv) [Item
601(b)(96)(iii)(B)(19)(iv) of Regulation S-K].
---------------------------------------------------------------------------

     require the qualified person to provide information
describing the underlying property in which a royalty company
registrant holds an interest only to the extent known or reasonably
available.\1142\
---------------------------------------------------------------------------

    \1142\ See 17 CFR 229.601(b)(96)(iii)(B)(3)(vii) [Item
601(b)(96)(iii)(B)(3)(vii) of Regulation S-K].

    In addition, unlike the proposed rules, the final rules permit, but
do not require, a registrant to file a technical report summary to
support the disclosure of material exploration results.\1143\ We
believe that this elective treatment will also help limit the final
rules' compliance burden.
---------------------------------------------------------------------------

    \1143\ See Item 601(b)(96)(i) of Regulation S-K.
---------------------------------------------------------------------------

    In another change from the proposed rules, in response to comments
received,\1144\ the final rules do not require separate sections about
hydrogeology and geotechnical data, including testing and analysis. We
have instead included the requirements for hydrogeology and
geotechnical data, including testing and analysis, in the requirements
for exploration data.\1145\ Consistent with the views of some
commenters,\1146\ we continue to believe that disclosure regarding
these two items, to the extent that they are material, is important and
will benefit investors. Hydrogeology and geotechnical data are the
basis for determining several design parameters that directly affect
the safety of the designed mine. Moreover, these design parameters can
affect the operating and capital costs and can, therefore, directly
affect the economics of the mine (i.e., the determination of reserves).
Detailed hydrogeology and geotechnical data will therefore provide
insight into the adequacy and appropriateness of the mine's design
parameters, which will allow investors and their advisors to evaluate
fully the disclosed economic viability of the mine. Nevertheless, by
moving the disclosure requirements for these two items in the section
regarding exploration data, we believe that it will be easier for
registrants to understand and comply with those requirements since they
will be placed within their proper context.
---------------------------------------------------------------------------

    \1144\ See supra notes 1097-1098 and accompanying text.
    \1145\ 17 CFR 229.601(b)(96)(iii)(B)(7) [Item
601(b)(96)(iii)(B)(7) of Regulation S-K].
    \1146\ See, e.g., letters from Midas and MMSA.
---------------------------------------------------------------------------

    In response to the commenter \1147\ who suggested that our
instructions to the required disclosure on ``processing and recovery
methods'' were vague because we used the term ``successfully'' to
qualify processing methods, plant designs, and other parameters that
have not yet been used in a commercial production of the valuable
product from the mineralization under consideration, we are adopting an
alternative provision.\1148\ This provision states that, if the
processing method, plant design or other parameters have never been
used to ``commercially'' extract the valuable product from such
mineralization, the qualified person must so state and provide a
justification for why he or she believes the approach will be
successful in this instance.\1149\ Similarly, an instruction provides
that, if the processing method, plant design, or other parameter has
never been used to ``commercially'' extract the valuable product from
such mineralization and is still under development, then no mineral
resources or reserves can be disclosed on the basis of that method,
design, or other parameter.\1150\ We are also clarifying, in response
to a commenter's concern,\1151\ that we consider a processing method or
plant design that has been demonstrated to be effective in a
demonstration or pilot plant to be adequate to meet the standard that
it is no longer ``under development.'' Such a processing method, plant
design, or other parameters resulting from the demonstration or pilot
plant can, therefore, be the basis for disclosure of mineral resources
or reserves.
---------------------------------------------------------------------------

    \1147\ See letter from Moats.
    \1148\ This provision is similar, although not identical, to the
instruction suggested by another commenter. See letter from Newmont.
    \1149\ 17 CFR 229.601(b)(96)(iii)(B)(14)(iv) [Item
601(b)(96)(iii)(B)(14)(iv) of Regulation S-K].
    \1150\ Instruction 1 to 17 CFR 229.601(b)(96)(iii)(B)(14) [Item
601(b)(96)(iii)(B)(14) of Regulation S-K].
    \1151\ See letter from Amec.
---------------------------------------------------------------------------

    Consistent with comments received,\1152\ we are adopting final
rules, as proposed, that restrict the technical report summary from
including large amounts of technical or other project data, either in
the report or as appendices to the report.\1153\ In addition, the
qualified person must draft the summary to conform, to the extent
practicable, with the plain English principles set forth under the
Securities Act and Exchange Act.\1154\ These

requirements should help improve the readability of the technical
report summary for the benefit of investors, particularly for those who
lack a scientific background, but also for more sophisticated investors