Union Mines Ministry moots panel for post auction issues of lapsing leases

The Union mines ministry has batted for a committee to look into the post auction issue of mining leases expiring by March 31, 2020.

The proposed panel will draw officials from the ministry, key mineral rich states of Odisha, Karnataka and Jharkhand and the Indian Bureau of Mines (IBM). The committee will be tasked with easing the transition in ownership of the mines and preparing draft guidelines to facilitate the same.

At the recent meeting of the central empowered committee, the ministry flagged concerns on the fate of the lapsing leases. The ministry called for exploration activity on all such leases to be completed by December 2018. 

As many as 329 mines are lapsing by March 31, 2020. These non-captive mines were allowed extension under the provisions of Section 8 (3) of the amended Mines and Minerals- Development & Regulation (MMDR) Act. Only 48 mines are operative now. As per the estimates of the ministry, 101 mines are eligible for auctions.

Goa has the most number of mines (184) headed for expiry. Next to Goa are Karnataka and Goa with 48 and 31 mining leases respectively. 

In Odisha, 17 merchant iron ore leases are set to expire by March 2020. The ending validity of these mines is set to trigger deficit of 66 million tonnes of iron ore annually. If other states like Karnataka, Goa and Jharkhand are factored in, total loss in iron ore production capacity could be 85 million tonnes a year, said an industry source.

Major mining leases in Odisha lapsing by March 31, 2020 include the ones held by Rungta Mines, KJS Ahluwalia, Serajuddin & Co, Kaypee Enterprises, Kalinga Mining Corporation, Mid East Integrated Steel Ltd, KN Ram, RB Das, Tarini Prasad Mohanty, KC Pradhan and Lal Traders.

The Odisha mines department is preparing the ground to auction 31 working mines, mostly iron ore and manganese leaes which are due to lapse by March 31, 2020.

Mineral bearing 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 (Amendment) MCDR 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. The Union mines ministry has targeted to auction the blocks by May 2019.

According to the notified Rules, mine leaseholders are required to submit exploration plans in 60 days from the date of the notification. Thereafter, the respective state governments would approve the plans over the next 30 days.