By Dan Oancea

"Commodity prices are used in the estimation of Mineral Resources and Mineral Reserves and in the economic analysis of a property. In times of rapidly changing commodity prices, or when prices are at the extreme ends of a commodity price cycle, the QP has a difficult job in selecting an appropriate commodity price.

• The selection of appropriate technical variables, including commodity price, is clearly the responsibility of the Qualified Person (QP). The QP must describe the reasons for selecting these variables, including price, in the technical report.

• The definition of a “Mineral Resource” contains the wording “reasonable prospects for economic extraction,” therefore, a QP must select economic parameters, including commodity price, that will result in an estimate of Mineral Resources and Mineral Reserves that have “reasonable prospects for economic extraction”..."

Read that and many more interesting questions and answers in a CSA-CIM Committee Meetings paper.