India: Ministry of Mines asks States to Complete Exploration of Lapsing Blocks

In a fresh reminder to states dragging their feet on auctions of mineral leases expiring by March 2020, the central mines ministry has called for completing exploration work by December this year.

The ministry assured that two central sector agencies- Mineral Exploration Corporation Ltd (MECL) and Geological Survey of India (GSI) will assist the states in the exploratory work. The Union mines secretary wants all states to start auctions of such lapsable mining leases by July 2019. The early preparation of the blocks will not only avoid any raw material shortage but also aid in a seamless transition of ownership of the leases.

Data compiled by the Union mines ministry says 288 leases of iron ore, chromite, limestone, manganese, bauxite, graphite, limestone, garnet and kyanite are due to lapse by March 31, 2020. Goa has the most number of mines (160) headed for expiry. Next to Goa are Karnataka and Odisha with 45 and 31 mining leases respectively. Of the 288 mines, 59 are in a working state and the balance is non-working leases.

Odisha has 31 such mines lapsing by March 31, 2o20- 24 working and seven non-working. Out of 24 working mines, exploration is completed for six mines whilst 15 others have submitted their revised plans to the Indian Bureau of Mines (IBM) for prospecting. The rest three are under scrutiny. The Odisha government aims to complete G2 level exploration in all working mines by the end of 2018. In case of the seven non-working mines, the state mines department has decided to seek approval for exploration under Section 18A of the Mines and Minerals- Development & Regulation (MMDR) Act.

Karnataka has 33 blocks whose validity ends on March 31, 2020. Exploratory activity has been completed for eight mines while eight other mines are under exploration. Jharkhand has five mines queued for expiry by 2020 where consent for exploration has been achieved and the activity is set to begin shortly.

The Andhra Pradesh government is preparing six of its lapsing mines for auctions by September next year. Gujarat has 11 such mines of which seven are eligible for auctions.

States are scrambling to prepare blocks lapsing by March 31, 2020 for auctions. The urgency to ready the mineral blocks for auction stems from the recent notification of the Draft Mineral Concession and Development- MCDR (Amendment) Rules, 2018 by the Government of India.

The MCDR is proposed to be amended to draw the roadmap for exploration so that the blocks can be auctioned before their validity ends. This is being done to ensure that production of key minerals like iron ore, manganese and chromite is not severely impacted due to the expiry of the leases.