Amendments to ASX Listing Rules and Guidance Note for entities in mining and oil and gas industries

What is the change?

The following ASX listing rules and guidance note are amended effective as of 1 July 2022:

• Chapter 5 - Additional reporting on mining and oil and gas production and exploration activities (Chapter 5);
• Chapter 19 – Interpretations and definitions (Chapter 19); and 
• Guidance Note 32 – Reporting on Oil & Gas Activities (GN32).

Why the change?

The reporting requirements in Chapter 5 and associated definitions in Chapter 19 are based on the 2007 edition of the Society of Petroleum Engineers’ Petroleum Resource Management System (SPE-PRMS), a system developed for the consistent and reliable definition, classification and estimation of hydrocarbon resources. The SPE-PRMS was subsequently updated in 2018 and, following a consultation process conducted by the ASX, amendments to the affected chapters were made in order to give effect to the resulting changes. GN32 was also updated to reflect final changes to the Listing Rules as well as issued raised in consultation submissions.

Summary of changes:

The rule amendments include the following changes and additions for consistency with the 2018 edition of the SPE-PRMS:

• Changes to the Rules governing the public reporting of petroleum resources including:
  • Addressing the sub-classification of petroleum reserves;
  • Clarifying that the requirement to report petroleum resources net of royalty quantities only applies to contractual royalties;
  • Requiring estimates of petroleum reserves, contingent resources and prospective resources to be reported in the appropriate units (BOEs or McfGEs) for each individual product type reported;
  • Requiring the reporting of reserve estimates to be reported as sales quantities at the reference point, subject to a qualification that quantities of petroleum to be consumed in operations (CiO) may be included as petroleum reserves provided these quantities are reported separately to, and have equal prominence with, sales quantities;
• Changes to the reporting requirements for material oil and gas projects including:
  • Amending and expanding the criteria for commerciality in accordance with the changes in SPE-PRMS section 2.1.2;
  • For unconventional petroleum projects, requiring the proposed extraction method and any additional processing required before sale to be identified; and
  • For reporting of contingent resources, requiring the inclusion of the entity’s assessment of the chance of development associated with the reported estimates of contingent resources;
• Changes to the annual reporting requirements for oil and gas entities including a change requiring an entity with material petroleum reserves that have not been developed for 5 or more years to include a statement in the entity’s annual report of “any work the entity is proposing to undertake towards development of the undeveloped petroleum reserves”;
• Adding the following new Rules:
  • Rule 5.27.5 setting out the information disclosure requirements for an entity reporting forecast financial information derived solely or partly from an estimate of economically not viable contingent resources;
  • Rule 5.28.3 to impose the same prohibition on the disclosure of a mean estimate of prospective resources as is imposed in relation to petroleum reserves and contingent resources in Rules 5.26.6 and 5.27.2;
  • Rules 5.28.4 and 5.28.5 to impose the same constraints on aggregation of prospective resources as are imposed on petroleum reserves and contingent resources in Rules 5.26.7, 5.26.8, 5.27.3, and 5.27.4; and
  • Rule 5.28.6 to prohibit an entity from reporting forecast financial information derived from an estimate of prospective resources;
• Amending Rule 5.30 requiring an entity publicly reporting material exploration and drilling results in relation to petroleum to include in its report, if flow rates were tested, information about the pressures associated with the flow and the duration of the test; and
• Consequential amendments to the definitions in Chapter 19 of the Rules, including deleting the definitions of ‘lease fuel’ and ‘reference point’ and inserting new definitions of ‘US oil and gas reserves statement’ and ‘SEC’.

Source: https://www.asxonline.com/content/asxonline/public/notices/2022/june/0697.22.06.html