Odisha, Chhattisgarh, MP line up mines for auction

The first auction of non-coal mines under the new mining law is likely to take off soon, with states such as Chhattisgarh, Rajasthan, Madhya Pradesh and Odisha showing readiness to auction 105 mines - 70 for mining licences and 45 for composite licences.

To boost the cement sector, Chhattisgarh and Rajasthan have proposed to auction 20 and 24 limestone mines, with an area of 427 hectares and 20,000 hectares, respectively. Overall, states have proposed to auction 65 limestone mines. States have also proposed to auction 33 iron ore mines by the end of this year to provide impetus to the languishing steel sector.

Odisha, which accounts for about half the iron ore deposits in India, has proposed to auction 10 mines. Karnataka and Madhya Pradesh expressed interest in auctioning eight and 14 iron ore mines, respectively.

Apart from limestone and iron ore, states are also interested in auctioning nine bauxite and right manganese mines. The Mines and Minerals (Development and Regulation), or MMDR, Amendment Act, 2015, was notified on March 27 to amend the MMDR Act, 1957. After the passage of the Act, the Centre had asked states to prepare data on the mines that could be auctioned as soon as possible.

The new Act has done away with discretionary powers for state governments in the grant of mineral concessions. Henceforth, all mineral concessions will be granted by state governments through auctions alone. According to the mineral auction rules, if a state government proves the mineral content through G3-level exploration, it can initiate the auction process for composite licences directly. In 1957 Act had no such provision for composite licences.

If a state government shows adequate evidence of mineral content through G2-level exploration, it can go for a mining licence auction directly.

A reconnaissance permit is granted for preliminary exploration through regional, aerial, geophysical or geochemical surveys and geological mapping. A prospecting licence is required for exploring, locating and proving mineral deposits. A mining licence is needed to extract minerals.