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Govt has no plan to extend tenure of non-captive mines, to auction 48 soon

Surya Sarathi Ray
As on date, 281 of these merchant mines are non-operating.

The government has "absolutely no plan" to extend the lease period for the 329 non-captive iron ore and manganese ore leases beyond March 30, 2019, an official source told FE.

Instead, preparations were underway in the mines ministry to issue notices inviting tenders (NITs) to auction 48 operational leases among these to ensure uninterrupted production, he added.

The expiry date for these merchant mines was pre-determined as per the provisions of the Mines and Minerals (Development and Regulation) Amendment Act, 2015. As on date, 281 of these merchant mines are non-operating.

The official said extension of the lease period for these mines are neither desirable nor in accordance with the law. Any extension would warrant amendment to the Act. Lease holders were aware of the fact since the time the Act was amended in 2015. Delaying the process would also send a wrong signal to the investors.

The operational mines annually produce around 45 million tonne of both the raw materials, mostly iron ore. Half of these mines are located in Odisha, six each in Jharkhand and Karnataka, five in Gujarat, three in Andhra Pradesh, two in Rajasthan and one each in Himachal Pradesh and Madhya Pradesh.

In order to facilitate auction of the working mines even before the expiry of leases, the government has already brought in an amendment to the Mineral Concession and Development Rules (MCDR) in March last year, mandating existing lessees to complete G2 level of exploration to establish main geological features of a deposit over the entire mineralised area before April 2019.

The mines ministry also initiated talks with the environment and forest ministry to allow continuation of mining operations for these mines beyond March for the new owner with initial approvals. Formal environment and forest clearances can come later. The early auctioning of these mines will benefit steelmakers such as JSW Steel and RINL which have been fearing disruption in supply of the key raw material.

The extant law, however, grants a lessee a total of seven months after the expiry of the lease to remove any ore mineral excavated during the lease period and the plant and machinery.