JORC vs. Brazilian ANM reports: what Australian buyers need to know

§ 01 · The Australian side

The JORC Code in brief

The JORC Code (2012 edition) sets minimum standards for public reporting of exploration results, mineral resources and ore reserves by companies listed on the ASX. It is built on three principles: transparency, materiality and competence. Every public estimate must be based on work by a competent person, a member of an approved professional organisation with relevant experience in the style of mineralisation.

The ASX Listing Rules, particularly Chapter 5, turn these principles into disclosure obligations. If a company announces a Brazilian acquisition, any number it publishes about tonnes, grades or contained metal must fit one of these frameworks.

Why the ASX is strict about foreign numbers

Australian investors rely on the JORC categories to compare projects across companies and countries. A number reported under a different standard, without explanation, breaks that comparison and can mislead the market. That is why the ASX looks closely at announcements of overseas acquisitions, and why a carefully prepared disclosure from day one is worth the effort. Queries from the exchange after an announcement are public and can damage credibility at exactly the moment a company wants to build it.

§ 02 · The Brazilian side

What the ANM final exploration report actually is

In Brazil, a company that holds an exploration permit must deliver a final exploration report (Relatório Final de Pesquisa) to the ANM at the end of its exploration work. If the report demonstrates a deposit that can be economically mined, the ANM approves it. Approval opens the way to a mining application and, eventually, a mining concession.

Approval is a genuine value milestone. It means the Brazilian state has accepted that a deposit exists, and it starts the clock on the mining application, which must normally be filed within one year. But the report was written for a regulator, not for the ASX, and it was not prepared under JORC.

Getting hold of the report

The seller should provide the full report with its annexes. If the asset passed through previous holders, earlier reports may also exist. Ask for all of them, not just the summary tables.

• The final exploration report and the ANM's approval decision
• Partial reports filed during the exploration term
• Drill logs, collar surveys and assay certificates referred to in the report
• Any economic development plan filed with a mining application

Remember that the report belongs to a specific ANM process. If a project is made of several permits, there may be several reports, approved at different times and prepared by different teams. Treat each one separately before trying to combine them.

§ 03 · Comparison

JORC and ANM reporting side by side

The two frameworks are not rivals. A well-prepared ANM report often contains exactly the data a competent person needs. The work is in auditing that data, filling its gaps and re-estimating under JORC.

A practical example of the translation problem: a Brazilian report lists an approved deposit with “reserva medida” and “reserva indicada” tonnages. In an ASX context, the honest description is a historical estimate in categories that the report's authors called measured and indicated reserves under Brazilian regulatory practice, which a competent person has not yet classified under JORC. It is longer, and it is the description that keeps the company out of trouble.

§ 04 · ASX rules

Reporting Brazilian numbers on the ASX: foreign and historical estimates

When an ASX company acquires a Brazilian project with an existing estimate that was not prepared under JORC, Listing Rule 5.12 governs whether and how it can be reported. The rule allows disclosure of foreign or historical estimates, but only with a specific set of information.

How a compliant disclosure is usually organised

1. A headline that names the estimate as a foreign or historical estimate, not a resource.
2. A cautionary statement, prominent and close to the figures.
3. A table of the original figures in their original categories.
4. Notes on source, date, methods, data and reliability.
5. The planned work programme to report under JORC, with its timing and funding.
6. The competent person statement.

A common mistake is to treat Listing Rule 5.12 as a formality. In practice it forces the company to explain the estimate's quality to the market, and investors read that explanation closely. A well-written disclosure that honestly describes data gaps and the plan to close them builds more credibility than a headline number that collapses under the first question.

§ 05 · Early stage

Using Brazilian data for a JORC exploration target

Not every Brazilian dataset is strong enough to support a resource. Many are strong enough to support an exploration target, a JORC tool for describing the potential of a project as a range of tonnes and grade, before a resource exists.

• It must be expressed as ranges, not single figures.
• It must explain the data and assumptions behind it.
• It must state clearly that the potential quantity and grade are conceptual, that there has been insufficient exploration to estimate a resource, and that further work may not result in one.

For a newly acquired Brazilian project, an exploration target built on old drilling, mapping and garimpo workings can be an honest and powerful way to show scale while the verification programme runs. It is also the right home for the large “potential” figures that sellers like to put in brochures.

If the seller's headline number cannot survive as a range with a cautionary statement, it should not be in your announcement.

Building a target from Brazilian data

• Use mapped pegmatite or vein dimensions and their known extents.
• Use historical drilling only where collars and assays can be traced.
• Apply grade ranges supported by sampling, not by the seller's best intercepts.
• Explain every assumption, including density and depth extent.
• State the work planned to test the target, and when.

§ 06 · In practice

What this means for lithium and gold projects in Brazil

The two commodities that draw most Australian interest to Brazil sit at different points on the data curve.

For gold, the Canadian equivalent of this discussion is set out in NI 43-101 and Brazilian gold projects. The logic is the same across both codes: state what the old number is, state what it is not, and show the work that will close the gap.

Data quality warning signs

§ 07 · Workflow

A due-diligence workflow for ASX companies buying in Brazil

1. 01

   Tenure screen

   Phase, holder, area, fees and expiry of every ANM process. Confirm the seller controls them.

2. 02

   Surface and constraints

   Overlay the polygons on land titles and protected-area layers; count the landowners.

3. 03

   Data room request

   Original ANM reports, assay certificates, drill logs, collar surveys, core location.

4. 04

   Competent person review

   Assess reliability, choose between exploration target, foreign-estimate disclosure or neither.

5. 05

   Structure

   Brazilian subsidiary, title assignment or share purchase, ANM approvals. See Can foreigners buy a mine in Brazil?.

6. 06

   Announcement

   Listing Rule 5.12 disclosure if relevant, JORC Table 1 for results, competent person statement.

7. 07

   Verification programme

   Twin holes, re-assays, QA/QC and a maiden JORC resource.

Steps one and two are where Brazilian deals most often fail, and they are the cheapest to run. A JORC resource on ground the company cannot access helps nobody.

In practice, the companies that announce Brazilian acquisitions smoothly are the ones that ran this workflow before signing, not after. Two weeks of tenure and data work protects months of market credibility.

Who does what