What is GKZ / B+C1 classification?
Soviet-era resource classification still used across parts of Central Asia and the Caucasus. Workable, but usually needs conversion or independent review before Western institutional investors will engage with the numbers.
Key points
- Categories reflect drilling density, not demonstrated economics.
- B+C1 is closer to a resource than to a JORC reserve.
- Conversion is a project with a cost, not a paperwork exercise.
At a glance
| GKZ | State Commission on Mineral Reserves |
|---|---|
| Categories | A, B, C1, C2, then P prognostic classes |
| Commonly quoted | B+C1 together |
| Still used in | Russia, Kazakhstan, Uzbekistan, the Caucasus |
| To convert | Verify historical data, twin holes, rebuild the model, competent person sign-off |
Where the system comes from
GKZ — the State Commission on Mineral Reserves — is the Soviet-era body whose classification system remains in use across Russia, Kazakhstan, Uzbekistan and much of the Caucasus. Reserves are placed in categories from A, the most thoroughly explored, through B and C1 to C2 and the more speculative P categories.
In practice B+C1 is the combination most often quoted, roughly corresponding to material explored densely enough to support mine planning.
Why it does not map cleanly onto JORC
The systems answer different questions. GKZ categories are driven by drilling density and geological confidence against state-set standards, and a deposit could be booked as reserves largely on geological grounds. JORC and NI 43-101 require economic viability to be demonstrated before anything becomes a reserve.
So a B+C1 figure is not a JORC reserve and should not be presented as one. It is closer in spirit to a resource, and often to an inferred or indicated one, depending on drill spacing and how the data were collected.
What conversion involves
Bringing a GKZ dataset to a JORC or NI 43-101 standard usually means verifying historical drilling and assay data, re-logging or twinning holes where records are thin, rebuilding the block model, and having a competent or qualified person take responsibility for the outcome.
That work costs real money and time, which is why it is normally the first item on the critical path when a Central Asian asset seeks Western financing. Investors rarely reject the underlying geology; they decline to underwrite numbers produced under a standard they cannot audit.
Frequently asked questions
- What does B+C1 mean?
- Two categories in the Soviet-era GKZ classification, indicating material explored to a density sufficient for mine planning. They are commonly quoted together and are not equivalent to JORC ore reserves.
- Can GKZ reserves be converted to JORC?
- Yes, but it is a project rather than a paperwork exercise: historical data must be verified, often with twin holes, the model rebuilt, and a competent person must take responsibility for the result.
- Why do investors discount GKZ figures?
- Because the categories are based largely on geological confidence rather than demonstrated economic viability, and the supporting data are frequently not auditable to the standard institutional capital requires.
Related terms
The Australasian standard for publicly reporting exploration results, mineral resources and ore reserves, governing disclosure for ASX-listed companies. A resource signed off by a competent person under JORC 2012 is the baseline serious mining investors expect.
The Canadian equivalent of JORC, governing technical disclosure for issuers listed in Canada. JORC and NI 43-101 are broadly comparable in intent, and either is generally acceptable to institutional capital.
The Australian term for a granted mining title — an exploration licence, mining lease or similar. Minimum expenditure and reporting obligations attach to the tenement itself, and failing them risks forfeiture regardless of any joint venture agreement.
Trading this, or trying to price it?
CommoFlow sources, buys, sells and ships physical commodities from the Middle East, Central Asia, the Caucasus, Africa and Australia. If a contract term is deciding your economics, our desk deals with it daily.
Contact our desk