Metals & Mining News

Exploration companies can now bid for mineral block after rules tweak


The centre has approved the modified scheme to engage Notified Private Exploration Agencies (NPEA) for critical and strategic mineral exploration, allowing them to bid for the blocks they explore. This is expected to boost exploration of minerals like lithium, gold, cobalt, and silver, among others.

According to an office memorandum, the scheme aims to boost activities in the country for exploration of critical and strategic minerals while also easing out the reimbursement and funding operations of the NPEA through the National Mineral Exploration Trust (NMET). The NMET is a non-profit body under the Mines Ministry for promoting mineral exploration.

It has approved 326 exploration projects of which 167 have been completed against which Rs 404.39 crore has been paid to the companies.

The latest rules note that approval to explore does not give exploration agencies the right to extract and sell the minerals, but the companies can compete in the bidding of the blocks. Bids quoted by the mine explorer will be made public during the auction to provide a level playing field to all participants.

ET had reported on November 24 that an update in mining rules will allow companies to explore a block and bid for it.

This move comes after a ban on exploration licence holders from bidding for mining acted as a deterrent for the sector, with many large mining companies that had units involved with exploration keeping away from participating in exploration. This put the entire burden of exploration on the Geological Survey of India (GSI) to establish mineable resources in the country.But the centre is taking a different approach for 24 critical and strategic minerals to wean away India’s import dependence by capitalising local availability. This list includes Graphite, Platinum, Lithium, and Cobalt among others. Another 29 minerals in the Seventh Schedule such as Gold, Diamond, and Silver can also be explored and bid for by the NEPA after the government nod.According to the published rules, the NEPA may submit an application outlining the details such as area and mineral commodities to the NMET. This proposal will be sent to the GSI and the State government for comments and feasibility report, which are to be submitted within one month. The NMET shall grant an in-principal approval or reject this proposal within 15 days of getting GSI and the state government’s comments.

The NEPA will submit the raw data during prospecting operations to the State government, Geological Survey of India (GSI) and the Indian Bureau of Mines (IBM). A final call on the potential mineral block remains with the centre.


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