LETTER TO THE EDITOR — QP to serve as guardians of procedure, not fall guy after the fact

As someone responsible, to a great extent, for formulating the proposed “Qualified Person” (QP) concept in the mining industry, particularly in exploration and mine development, I would like to respond to Chris Lloyd’s letter (“QP a scapegoat in an imperfect system,” T.N.M., Oct. 26-Nov. 1/98).

The writer of the letter is quite correct to point out that the process of finding and developing mines, including the financing of these activities, involves a chain of actions and people, and that such a chain “is only as strong as its weakest link.” In this regard, he may be assured that all links currently are undergoing close scrutiny in order to ensure a stronger chain. The QP concept is being proposed as a way of strengthening one of these links — the generating and reporting of technical information.

The QP concept, as incorporated in the interim report of the Mining Standards Task Force (and the proposed adoption of the concept by the Canadian Securities Administrators in National Instrument 43-101), is intended to enhance the quality of the acquisition and reporting of technical information. The purpose is to provide greater confidence for those making investment decisions based on the technical data. Basically, the concept ensures that the technical work is carried out under the direction of a suitably qualified individual and that the technical information emanating from this work is reported correctly and in context.

With reference to Lloyd’s letter, the QP concept is not something “being created so that when all the other people and institutions screw up, there is someone to blame.” The concept does assign responsibility to professionals for technical matters; it does not shift overall responsibility for corporate actions from management to the QP.

The letter-writer is wrong in supposing that “only an engineer can become a Qualified Person.” The concept applies to all mining professionals, be they geologists, mining engineers or metallurgists. Different QPs will be responsible for different technical fields. Geologists, in particular, have long lamented the fact that they are not given sufficient responsibility; now responsibility will be assigned, but it must be recognized that responsibility is accompanied by accountability.

That there is some confusion regarding the QP concept, as in the views expressed by your letter-writer, is understandable. To a certain extent, the concept is new to Canadians, and geoscientists especially are unfamiliar with the responsibility and accountability that the concept will thrust on them. Furthermore, judging from the comments received since the publishing of the task force’s report, greater clarification is needed as to what QPs are responsible for and, more importantly, what they are not responsible for. This is currently being addressed by the task force and will be included in its final report.

Finally, with reference to the last paragraph in the letter, the QP concept is being proposed exactly as a proactive measure, ensuring that competent, qualified professionals are involved right from the start of exploration and the reporting of exploration results to discovery, resource delineation, reserve estimation and mine development. It is not a device for finding a scapegoat after the event.

Kenneth Grace

VP, Micon International

Toronto