States to auction 108 mineral blocks by Dec

District Mineral Foundation rates yet to be finalised

A total of 66 mining leases (ML) and 34 composite licences (prospecting licence-cum-mining licence) would be auctioned by the state governments this year under the new mining law.

Karnataka and Odisha would be auctioning 15 and six blocks of iron ore for ML by October. Both the states have also listed a total of 13 blocks for composite licence auction. However, it is not clear when they would go under the hammer. Similarly, Rajasthan and Gujarat have said they would auction 10 and six limestone blocks, respectively, for ML by October. None of the states have, however, notified the structure of the District Mineral Foundation (DMF) as yet. They have given assurances that they would notify the DMF structure only by August-end.

Under the Mines and Mineral (Development and Regulation) Amendment Act, 2015 - passed in March 2015 - the states have to set up DMF in every district affected by mining for local benefit sharing. The companies, mining in a particular district, would be paying a certain amount to DMF for its functioning.

According to the latest information provided by the state governments to the Centre, a total of 108 non-coal mineral blocks would be auctioned by the year-end. Around 66 and 21 blocks would be auctioned for mining leases (ML) and composite licences, respectively. Moreover, Chhattisgarh has earmarked 21 other mineral blocks for the second phase of auction to take place by December. It is, however, not clear as to how many of these would be auctioned for ML or composite licence.

A prospecting licence means licence granted for the purpose of exploration, locating or proving mineral deposits through pitting, trenching, drilling or sub-surface excavation. ML is the final licence required to excavate minerals. According to the rules, a mine where G2 level exploration has been done, would be auctioned for ML only. For a mine where only G3 level exploration has been done, the auction will be for composite licence.