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Subject: Comments to Draft Specifications for Application of UNFC-2009: from Fivos Spathopoulos

22 October 2012

Dear Colleagues,

Many thanks for sending me the draft document.

  • The draft is a very good piece of work. No doubt about it. It still, however, tries to align the UNFC with the PRMS scheme, without explaining how a 3-D scheme can be aligned to a 2-D scheme. Since the last time I communicated my thoughts, several important things happened in the mining/energy sector. The most important is that in Europe (at least) for every mining/energy project, a E.I.A. (Environmental Impact Assessment) has to be compiled and submitted to the authorities. This document must include now both strictly environmental issues, as well as "Public Acceptance" issues. This means that, even if a company has a fully developed project (i.e. Geology and Finance OK), if it fails in the E.I.A., the project dies or it is severely delayed. The E axis in UNFC caters for this eventuality, but not the PRMS. Examples abound: (i) the Cuadrilla shale-gas discovery in NW England, which cannot be developed; (ii) the shale-oil exploration in Paris Basin, which is prematurely stopped, although the geological and financial evidence is positive; (iii) the decision of the Bulgarian government a year ago to stop unconventional exploration and take back all related permits.
  • the draft document, in the E axis description, fails to deals with the "non-technical factors", although such issues are mandated in the original document. How are the "non-technical factors" defined and dealt with? For the E axis, the original reads: "Socio-Economic Viability: Economic plus other relevant "market conditions", also considering commodity prices, costs, legal/fiscal framework, environmental, social and all other non-technical factors that could directly impact the viability of the project". As I have frequently said in this forum, this definition is a great addition to the process of estimating volumes globally. That is why, I expected more discussion about it.
  • It is over 2 years now, that no procedure has been developed for "unconventional" resources, although more and more countries are "selling" them (including the EU, Australia, South Africa, Indonesia, Ukraine, Argentina, Brazil, Canada etc). The standard justification is "awaiting for CRIRSCO's input", which is very delayed. Without downplaying CRIRSCO's importance, would it be advisable to, at least, start a conversation on this matter?

I hope my comments are useful.

Best regards to all,

Fivos Spathopoulos