India targets advanced exploration of 73 mineral blocks in current financial year

KOLKATA (miningweekly.com) – India has targeted the completion of advanced exploration across 73 mineral blocks during 2017/18 in order for these blocks to be ready for the next phase of provincial government auctions.

This is according to a Mines Ministry document on a review meeting of provinces’ mining preparedness. The document notes that the Geological Survey of India (GSI) has already started the advanced exploration of these 73 mineral blocks.

GSI completed G2 and G3 levels of exploration across 82 mineral blocks during 2016/17, with the Mines Ministry noting that provincial governments should be ready to complete auctioning of these blocks during the current financial year.

According to the Ministry, preparedness of the provincial governments and timely completion of the auction of mineral blocks will be the key to maintaining the growth in mineral production.

It noted that total mineral production, except coal, during 2016/17 was pegged at 192-million tons and “not too far from the highest-ever level of 218-million tons achieved in 2009/10”. However, surpassing the record of that year will depend entirely on provincial governments’ ability to monetise newer assets.

Since the legislative environment changed and auctions became mandatory in 2015, the total revenue generated through the auction of 27 major mineral blocks has been pegged at $18.61-billion. Key to this revenue generation has been the low reserve price, which, in turn, triggered aggressive bidding and higher bid value.

Yet another critical issue facing the provincial governments, flagged by the Ministry, is that 300 mining leases are up for expiry by 2020. As per a federal government directive, the local governments will have to gear up for auction of these expired mining leases.

According to a Ministry official, this would be an “onerous” task for the provincial governments as the Mines Ministry has stipulated that each of the mineral blocks will have to mandatorily go in for fresh exploration up to minimum G2 level before the same block is put up for auction.

The official said that the Ministry has directed each mineral-bearing province to submit a status report by September 17, detailing the plans for these blocks where existing mining leases are scheduled to expire by 2020.