Rules for off-shore mineral block auctions under preparation: Mines Secretary

Abhishek Law Updated - March 22, 2024 at 08:54 PM.
V. L. Kantha Rao, Secretary, Union Ministry of Mines | Photo Credit: H S MANJUNATH

The Mines Ministry has begun the process of framing rules for the auction of the first-ever offshore mineral blocks in the country. Some 10-odd mineral blocks are to be put up for auction sometime in June-July.

The Ministry has also appointed SBI Caps as consultant for overseeing the process.

Typically, offshore mining or deep sea mining refers to the process of retrieving mineral deposits from the ocean below 200 metres — the deep seabed.

According to VL Kantha Rao, Secretary, Ministry of Mines, inter-ministerial consultations are underway and “over the next 30 days” the NoCs are expected across Ministries like Defence and others.

The Ministry has also sought comments and inputs from Ministries/Departments concerned on the availability of offshore blocks for the grant of operating rights to avoid any overlapping of projects.

The blocks are located on both the east and west coast with typical minerals under identification being construction sandlime, mud and poly-metallic nodules.

Blocks identified

Incidentally, the Ministry has so far identified 35-odd offshore mineral blocks and 10 have been shortlisted for the first round of auctions. The Ministry has identified some blocks in the exclusive economic zone, that is, beyond territorial water (12 nautical miles), for sand lime, mud and polymetallic nodules.

Some years ago, the GSI had referred to lime mud deposits in the Arabian Sea. The mineral, primarily imported, finds usage as a raw material in steel, paint, pharma and glass industries. On the other hand, marine sand deposits (used in the construction industry) were reported off the coast of Kerala.

Draft Rules

“The first round of auctions is likely later this year. And right now, we are in the process of framing the rules for the auctions. In the next 30 days or so, we hope to receive the clearances from across ministries and other departments. Consultations are on,” Rao told businessline on the sidelines of an event by FICCI.

Rules under discussion state, the auction for production leases can be made at G3 level (detailed ground geophysics l work) of exploration.

Composite licences

The draft rules propose that composite licences and production leases can be granted at least G2 level of exploration (general exploration level) for considering a block. Composite licences are proposed to be granted at the G4 level of exploration or reconnaissance when the mineral potentiality of the block is identified.

According to Rao, the Ministry is expected to announce the names of winners of the first tranche of the auction of critical mineral blocks “over the next 10 days”.

Tepid response

Initially, 20 blocks had been auctioned, but seven of these — which include one block of lithium in Jammu and Kashmir — received less than three bids. They were put up for the third round of auction on March 14.

The first round saw bids from over 50 companies which include the likes of Vedanta, JSW, Jindal Power, Rungta Group, Ola, Shree Cement, Dalmia Group, Coal India and NLC.

Some of the critical minerals put up for auctions in the first tranche include lithium, graphite, glauconite, molybdenum, nickel, copper and potash.

Published on March 22, 2024 13:13

This is a Premium article available exclusively to our subscribers.

Subscribe now to and get well-researched and unbiased insights on the Stock market, Economy, Commodities and more...

You have reached your free article limit. Subscribe now to and get well-researched and unbiased insights on the Stock market, Economy, Commodities and more...

You have reached your free article limit. Subscribe now to and get well-researched and unbiased insights on the Stock market, Economy, Commodities and more...

TheHindu Businessline operates by its editorial values to provide you quality journalism.

This is your last free article.