SGAT opposes auctioning of mining leases

The Society for Geoscientists and Allied Technologists (SGAT), a body dedicated to promotion of mineral development, has opposed the grant of new mining leases via the competitive bidding route as proposed in the Mines and Minerals (Development & Regulation) MMDR Amendment Bill, 2014.

“A land, a house property and illegally extracted minerals can be auctioned, but not a mineral property. Reserves available in a mineral deposit is subject to fluctuation with developments in technology. We think, no developed or developing country has resorted to this practice. Our view is that the proposed auction route will not be in the interest of mineral development,” SGAT said in its views submitted to the Union mines ministry.

SGAT has argued that auctioning of mining leases would prevent persons having special knowledge and experience to participate in the bidding process. It said, this practice would result in cartelisation and the successful bidder may not be obliged to supply ore/mineral to domestic industries and for export. The successful bidder will most certainly resort to selective mining, thereby rendering the mineral property unsuitable for scientific mining, the body opined. According to SGAT, the proposal of disposal of mineral bearing areas for development through auction is likely to make the provisions of reconnaissance permit (RP) & prospecting licence redundant.

SGAT has also opposed to the proposal for classifying minerals as ‘notified’ and ‘non-notified’. It has further held the maximum areas prescribed for prospecting licenses (PL) and mining lease (ML) are quite large. These may be limited to 100 sq km for PL and 50 sq km for ML.

Ruling out the need to constitute special courts, SGAT said, the existing judicial system can well be strengthened for speedy trial of offences relating to illegal mining.

It has pitched for participation of private players in mineral exploration.

“We would like to emphasize the fact that government agencies alone cannot carry out detailed exploration for proving mineral deposits. The private sector has to step-in in a big way. This is also the approach of National Mineral Policy, 2008”, SGAT stated.

SGAT has also called for streamlining forest and environment laws and expediting procedures for granting clearances. The laws relating to forest & environment clearances can be merged into a single umbrella law as recommended by TSR Subramaniam committee to facilitate and expedite clearances.

Additionally, SGAT has suggested that the statutory requirement of obtaining prior approval of central government for grant of renewal of mining leases for scheduled minerals may be dispensed with and the state governments be authorised to grant first and subsequent renewals of MLs if the state governments are satisfied that it is necessary to do so in the interest of mineral development.