New Min­ing Pol­icy May Of­fer 100 Large Plots to Global, In­dian Cos for Ex­plo­ration

EM­PHA­SIS IS BE­ING LAID ON PVT SEC­TOR PAR­TIC­I­PA­TION AS ONLY 10% RE­GIONAL MIN­ERAL EX­PLO­RATION IS BE­ING CAR­RIED OUT

Resource Digest - - CONTENT -

The govern­ment plans to trans­form the min­ing sec­tor with a new pol­icy by of­fer­ing global and In­dian firms about 100 large plots for ex­plo­ration of var­i­ous min­er­als with a re­verse auc­tion to ex­plore, fol­lowed by an­other round of bid­ding to ex­tract the ores, of­fi­cial sources said.

In the first stage, com­pa­nies will bid for roy­alty they will get for min­er­als they dis­cover and com­pen­sa­tion for the ex­pen­di­ture on ex­plo­ration if they do not find any com­mer­cial re­serve in the block.

The mines min­istry has ini­ti­ated in­ter-min­is­te­rial con­sul­ta­tions for the new min­er­als pol­icy, which aims to sig­nif­i­cantly ex­pand ex­plo­ration of min­er­als and at­tract pri­vate cap­i­tal for the sec­tor that will also ben­e­fit the states. The govern­ment is iden­ti­fy­ing large tracts of land for auc­tion to min­eral ex­plo­ration com­pa­nies. Mines Sec­re­tary Balvin­der Ku­mar said “the min­istry has sought con­cur­rence of states on the pol­icy that is a win-win or cen­tral and state gov­ern­ments and pri­vate ex­plo­ration agen­cies“. The pol­icy pro­vides for iden­ti­fi­ca­tion and auc­tion of po­ten­tial blocks to ex­plo­ration agen­cies that are reg­is­tered in In­dia. The govern­ment will con­duct an on­line re­verse auc­tion among tech­ni­cally qual­i­fied agen­cies. The com­pa­nies will have to quote share of roy­alty that ac­crue to state gov­ern­ments through­out the lease pe­riod of the mine once it be­gins op­er­a­tions.

Com­pa­nies seek­ing lower share in roy­alty will win the blocks for ex­plo­ration. If the re­serves are es­tab­lished af­ter ex­plo­ration, the blocks will be auc­tioned to min­ers who will pay roy­alty to the ex­plo­ration agen­cies and state gov­ern­ments for 50 years of the mine life.

The govern­ment will work out nor­ma­tive cost of ex­plo­ration works for dif­fer­ent min­er­als to com­pen­sate min­eral ex­plor­ers in case re­serves are not found. The com­pen­sa­tion will be made through a fund set up to en­hance ex­plo­ration ac­tiv­i­ties.

The govern­ment has laid em­pha­sis on pri­vate sec­tor par­tic­i­pa­tion in ex­plo­ration as In­dia has been able to carry out only 10% re­gional min­eral ex­plo­ration while coun­tries like Aus­tralia that have sim­i­lar ge­o­log­i­cal en­dow­ment have com­pleted 100% of ex­plo­ration.

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