51-327 - Oil and Gas Disclosure: Resources Other Than Reserves Data [CSA Staff Notice]

1. Introduction
National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities(NI 51-101) mandates the disclosure of “reserves data”, which is defined in NI 51-101 to include “an estimate of proved reserves and probable reserves”.  Disclosure of “resources” not included in reserves data is not required under NI 51-101.  Although this disclosure is optional, staff of the Canadian Securities Administrators (the CSA) have seen a significant increase in the disclosure of possible reserves and other resource classes, especially for unconventional resources. 

The disclosure of resources other than reserves data must be consistent with all applicable securities laws including, but not limited to, the principles and specific requirements and restrictions of NI 51-101.  For example, a reporting issuer must not make misleading or untrue statements, or omit any fact from its disclosure that would prevent a statement from being misleading.

This CSA Staff Notice (this Notice) provides guidance on recurring issues that we have found in our review of reporting issuers’ disclosure of resources other than reserves data.

Specifically, we provide guidance in this Notice about:

• disclosure of stand-alone possible reserves;
• aggregation of estimates for several properties
• partially risked prospective resources;
• use of the term “best estimate”;
• technology under development for contingent resources;
• classification to the most specific class and category of resource; and
• criteria for classification of unconventional hydrocarbons as discovered petroleum initially-in-place.

We think that it may be misleading for reporting issuers to disclose resources other than reserves data without providing some context to that data.  We recommend cautionary statements throughout this Notice to assist reporting issuers in providing that context.  A reporting issuer may use cautionary language other than that recommended by this Notice. 

View PDF of 51-327 Oil and Gas Disclosure: Resources Other Than Reserves Data [CSA Staff Notice]