Comments
In a bid to attract private sector investment into exploration of non-fuel and non-coal minerals, the Union Cabinet on Wednesday approved the National Mineral Exploration Policy (NMEP).
To implement the NMEP in totality, an amount of ₹2,116 crore is required over five years, said Minister for Steel and Mines Narendra Singh Tomar.
The NMEP envisages acreages to be auctioned to private companies on a revenue-sharing model. Exploration companies will recoup their investments from a share of the revenue accruing to States after the mineral reserves are proven, the acreages are auctioned and production begins.
If no mineral reserves are found, the exploration expenditure will be reimbursed on a normative cost basis.
“After the amendments to the Mines and Minerals (Development and Regulation) Act, all explored mines were to be auctioned. [But] without the National Mineral Exploration policy, activity in exploration could not happen. While we have Geological Survey of India and Mineral Exploration Company Ltd, they have limited capabilities. Therefore, to attract the private sector, some steps are required,” Tomar told the media after the Cabinet meeting.
The policy also provides for the creation of a National Geo-scientific Data Repository. The government will also carry out National Aero-geophysical Programme for acquiring baseline data for targeting concealed mineral deposits.
“In the first phase, we have identified 100 blocks of roughly 100 square metre area, each of which will be auctioned. SBI Capital Markets has been engaged as a consultant to come up with the modalities of the auction. The entire process will take about six months to begin,” said Balvinder Kumar, Secretary, Ministry of Mines.
He added that exploration companies will be given an option of annuity or upfront payment to collect their revenue share. The Secretary said it would be the State governments that would hold the auctions, and the Centre will ‘hand hold’ the States in the entire process.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.