Subject: Draft Revised UNFC-2008 and Draft Accompanying Explanatory Note From: Ferdi Camisani on behalf of the CRIRSCO Board

12 December 2008

CRIRSCO Board

Dear Sigurd

CRIRSCO members met during 23-27 November in Santiago and on their behalf I would like to convey congratulations to you, to Charlotte and the members of the AHGE and Task Forces for the progress made in developing the new UNFC draft.

The members of CRIRSCO have indicated the following suggestions with regard to that draft:

1. CRIRSCO sees no need to add specifications and guidelines to the existing text other than those required to explain to users the purpose of the document and how it should be used. If further explanations are felt to be necessary, they should be high-level, in line with the Mapping Task Force recommendations that detailed texts should be confined to the commodity specific classifications such as the CRIRSCO Template and PRMS.
    
2. The Mapping of Petroleum and Minerals Reserves and Resources Classification Systems publication is an important document and fundamental in understanding the logic of the new UNFC. It should be referred to in the UNFC-2008 and made readily available as an immediate reference to the professional reader/analyst.
    
3. Financial reporting is outside the scope of a classification code. If reference is made to financial reporting, it should be high-level and should not be included in the main body text of the UNFC-2008. The extent to which references to financial reporting are required should be driven by the outcome of the IASB Extractive Activities research project.
    
4. The paragraphs on “Reserves” in the Explanatory Notes (No. 22, 23 and 24), with the suggestion that the term (Reserves) leads to “extensive misunderstanding of the meaning” and is “not ideal for global communication”, are inaccurate and somewhat confusing and should be deleted or rephrased. Firstly, the term “Reserves” is well entrenched in all major minerals (and petroleum) classification codes and security exchange regulations and has been so for the last 40-50 years. Secondly, there is a basic misunderstanding: “Reserves” in metals are not the “quantities produced at the plant” but the quantities (=ore tonnes at a certain metal grade) reporting to the plant for treatment. What is produced at the plant is the metal extracted from the ore and this metal is never called reserve.
    
5. Both SPE/AAPG and CRIRSCO should be included in the “Maintenance” chapter as being part of the stakeholders, and finally
    
6. CRIRSCO believes that if the current UNFC Draft can be adopted without significant modifications and without excessive specifications or guidelines, the document could be published following the March 2009 AHGE meetings in Geneva. If further modifications are required, including significant specifications and guidelines it would be more realistic to consider mid- to end-2010 as the time-frame for its publication.
   
   I am sure that the AHGE will give CRIRSCO's suggestions due consideration.
   
   Best regards
   Ferdi Camisani on behalf of the CRIRSCO Board