Australia: ASX's proposed Listing Rules - more onerous disclosure obligations for mining, oil & gas companies

Key Points:

Brett Cohen and Warrick Louey explain why ASX's proposed changes to its Listing Rules will mean more onerous disclosure obligations for mining and oil & gas companies.

On 2 April 2012, ASX released a paper, "Strengthening Australia's equity capital markets: ASX proposals and consultation" (ASX Proposals Paper), which sets out the first phase of initiatives it proposes to roll out in 2012 to strengthen Australia's equity capital markets.

As ASX has foreshadowed, ASX is proposing to impose more onerous disclosure obligations on mining and oil & gas companies to improve the level of disclosure to investors in the resources sector.

ASX's proposals detailed in the ASX Proposals Paper also include:

  • increasing the capital raising limit for mid to small cap companies (ie. entities with a market capitalisation of $300 million or less) from 15% to 25% . Such companies will be able to seek a 12-month shareholder mandate to issue up to 10% of the company's issued capital at a maximum 25% discount to the market price. This will be in addition to the 15% already permitted under ASX Listing Rule 7.1; and
  • updating ASX's admission requirements, by increasing the minimum net tangible assets test from $2 million up to $4 million, and providing new ways for companies to meet shareholder spread requirements.

On 5 October 2011, ASX released a consultation paper, "Reserves and Resources Disclosure Rules for Mining and Oil & Gas Companies", that focused on opportunities for updating and improving the disclosure obligations applicable to mining and oil & gas companies. Developments in international standards relating to the reporting of mineral and petroleum information, increasing demand for Australian resources and the need for consistency and confidence in public reporting by mining and oil & gas companies were the key drivers behind the consultation paper.

Following the release of the consultation paper, ASX conducted an extensive consultation process and received numerous written submissions.

ASX's "Reserves and Resources Disclosure Rules for Mining and Oil & Gas Companies – Report on Consultation Feedback" (Feedback Report), contained in the ASX Proposals Paper, details ASX's proposals and the feedback received in response to the Consultation Paper. ASX reports that its proposals for greater transparency and consistency in the reporting of reserves and resources received broad industry support, although ASX notes a divergence of views in relation to the reporting of production targets and other forecast financial information by mining companies.

ASX is currently preparing amendments to the ASX Listing Rules to reflect the proposed changes to resource and reserve disclosure by mining and oil & gas companies. ASX says that it expects to release an exposure draft of the proposed changes for comment in mid-2012.

ASX is also proposing to:

  • work with the Joint Ore Reserves Committee (JORC) to update the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves" (JORC Code) to enhance reserves and resources reporting requirements for ASX listed mining companies; and
  • update the reporting framework for petroleum reserves and other petroleum resources under the ASX Listing Rules, by introducing a requirement that petroleum reserves and other petroleum resources be reported in accordance with the Petroleum Resources Management System (SPE-PRMS), and a requirement to report key technical and other information relating to the disclosure of a booking of petroleum reserves and other petroleum resource estimates for material projects.

The proposed changes to the disclosure obligations are in many respects significant. Listed mining and oil & gas companies should consider how the changes may impact on their reporting obligations and systems, increase associated compliance costs and put additional pressure on company resources.

Disclosure of production targets

ASX's preferred approach to facilitate improved disclosure of production targets and associated forecast financial information is to prohibit the disclosure of a production target based solely on an exploration target (ie. a company must have mineral resources and/or reserves as defined under the JORC Code as a basis for the disclosure of a production target).

ASX will rely on the company to determine when it has a reasonable basis to disclose a production target, having regard to its obligations under the Corporations Act and its particular circumstances. ASX proposes that the ASX Listing Rules will set out the supporting information that must be disclosed to enable investors to understand and assess the basis and reliability of the stated production target.

ASX states that its preferred option seeks to achieve an appropriate balance between:

  • minimising the potential for the disclosure of misleading information; and
  • not preventing the disclosure of information where the company has determined it has a reasonable basis and where it may have a material effect on the price or value of the company's securities.

ASX considers that this balance is largely met by requiring greater disclosure of the bases underlying a production target and the inclusion of appropriate qualifications and cautionary statements.

ASX noted a considerable divergence of views relates to whether production targets should be permitted to be disclosed by mining companies when based solely on inferred mineral resources (or a combination of inferred mineral resources and exploration targets). An "inferred mineral resource" under the JORC Code is a mineral resource that has a comparatively low level of geological certainty.

In December 2011 following the release of ASX's Consultation Paper, ASIC expressed concern that inferred resources and exploration targets are too uncertain and not a reasonable basis for disclosing production targets and associated forward-looking information. ASIC believes that such disclosure may be misleading, because the disclosure implies that those targets will be achieved (notwithstanding the underlying low level of geological certainty of an inferred mineral resource and the conceptual nature of an exploration target).

Despite ASIC's expressed concerns, ASX's proposal would permit such disclosure, provided that the company has a reasonable basis. ASX noted in the Feedback Report that there may be circumstances where a company may have a reasonable basis for disclosing production targets based on inferred resources (and that certain types of mineralisation may provide a better basis for disclosure than others). ASX noted concerns that a prohibition on such disclosure may result in the market not being fully informed, and would make it more difficult for junior mining companies to raise the finance required to fund the next stage of project development.

Companies should still be mindful of ASIC's position in respect of the reporting of production targets and associated forecast financial information when preparing offer documents or making market announcements – ASIC retains powers of market supervision and review of disclosure documents for capital raisings. ASIC has demonstrated a willingness to apply its position, and may continue to do so, notwithstanding ASX's preferred approach that would permit the disclosure of production targets based wholly or partly on inferred mineral resources.

ASIC had also submitted that production targets should be consented to by a competent person. ASX does not appear minded to introduce this requirement. ASX noted that the majority of submissions considered that production targets were the responsibility of company directors and officers, particularly as a production target involves input from a number of disciplines, which is beyond the scope of expertise of a competent person.

The proposed changes

The changes proposed to the ASX Listing Rules to improve the level of disclosure to investors in the resources sector concern:

  • reporting on key technical and other supporting information when an initial (or materially changed) estimate of mineral resources and ore reserves for a material project is publicly reported for the first time;
  • reporting on key technical and other supporting information when estimates of petroleum reserves, contingent resources and prospective resources for a material project are booked and reported for the first time;
  • annual reporting for mineral resources, ore reserves, petroleum reserves and other petroleum resources;
  • reporting of production targets and historical estimates of mineralisation by mining companies;
  • all public reporting of petroleum reserves and drilling results;
  • reporting of petroleum exploration and drilling results; and
  • the minimum professional qualifications and experience required to be a "qualified reserves and resources evaluator" for the purpose of signing-off publicly reported petroleum reserves and other petroleum resources.

You might also be interested in...

Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this bulletin. Persons listed may not be admitted in all states and territories.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Mondaq Advice Centre (MACs)
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.