Three Pillars of Mineral Valuation

The International Mineral Valuation (IMVAL) Committee, founded in 2012, develops strategies for conducting mineral valuations. These strategies have been developed into a mineral asset valuation template called the International Mineral Property Valuation Standards Template and is part of IMVAL's work to establish consistent international standards for mineral property valuation and reporting. This template is a living document that is updated from time to time and is based on three core values or pillars (Fundamental Principles): Competence, Materiality, and Transparency. Objectivity, Independence, and Reasonableness may be applied as required by national codes or standards. The Template harmonizes international standards for valuation of mineral assets as real property and represents a consensus of current good practices. It is not a stand-alone reporting code and does not supersede existing national reporting standards. The Template deals with mineral-property valuation as distinct from mineral-project evaluation. INTRODUCTION In his 1989 book, “The New Realities”, Peter F. Drucker, Clark Professor of Social Science at Claremont Graduate School, California, stated: “Information is data endowed with relevance and purpose. Converting data into information thus requires knowledge. And knowledge, by definition, is specialized.” (p. 209) The discipline of mineral valuation is knowledge-based and requires a mineral valuer to collect, analyze, and interpret data that are material to a mineral valuation assignment. In so doing, the valuer turns the data into information (data come first, followed by information as determined by the mineral valuer) for use by the client (from whom the valuer obtained the mineral valuation assignment) and other intended users. The valuer uses his or her experience and education (each valuer’s knowledge base) supported by a foundation built upon competency, materiality, and transparency, the three pillars of mineral valuation (“minerals valuation”, “mineral-property valuation”). The International Mineral Valuation Standards Template (“IMVAL Template”, IMVAL”, “Template”), third edition dated May 2018, defines mineral valuation as: “The estimation of the Value of a Mineral Property in money or monetary equivalent. The word ‘valuation’ can be used to refer to the estimated value (the Valuation conclusion) or to refer to the preparation of the estimated Value (the act of valuing).” (p. 14) Furthermore, the IMVAL Template clearly separates valuation from evaluation: “The Template deals with Valuation, which is distinct from Evaluation. The distinction inherent in these defined terms is that Valuation addresses the estimation of value of a Mineral Property, whereas Evaluation addresses the broader assessment of a Mineral Property for an investment decision.” (p. 2)