India: Concerns raised over reserves data in Goa iron ore mine auctions

Prospective bidders have concerns about the inadequate information regarding the geological reserves in the tender document of the four iron ore blocks Goa is set to auction.

These four blocks, Bicholim, Sirigao-Mayem, Monte De Sirigao and Kalay, are the first Goa is putting up for auction, transitioning to a policy regime that grants mining rights to whoever offers the greatest share of future revenues. Goa's Directorate of Mines and Geology has arrived at an estimate of reserves from old mining plans; however, it is not sharing these.

Some of the participating companies feel the slimmer-than-usual geological reports offer insufficient information for them to make a fair and independent assessment of the blocks.

These concerns were raised in the pre-bid interactions and the DMG was asked if it would later, post auction, consider adjusting the upfront payments and performance security for any mismatch between the reports and the actual mineable reserves. The state's formal response to these queries was, "Necessary data has been made available as per tender document."

Unsatisfied with this response, MSPL has flagged the issue in a letter to the Secretary, Ministry of Mines, Government of India. "In the absence of borehole data bidders can't assess the likely quality of mineable ore to come up. On top of this, bidders were not allowed to collect samples from mines during mine visits," says the letter.

The Karnataka miner hopes the Centre can convince the state to provide basic exploration data in Excel formats, drawings in AutoCAD and copy of the last approved mine plans, necessary for a fair and sustainable bid.

The directorate is of the view that it is in no position to validate submissions ex lessees made to the Indian Bureau of Mines, and that it has mutatis mutandis, adopted the Ministry's tender template.

Miners point out that in Odisha, geological reports were specifically prepared; in Jharkhand, since the estimated reserve was arrived at from previous mining plans, these plans have been shared with prospective bidders.

~ By Meera Mohanty