National Mineral Policy 2006 - Department of Mines

National Mineral Policy 2006 - Department of Mines National Mineral Policy 2006 - Department of Mines

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permissible activities in order to make the reconnaissance operation more conclusive. Section3 of the MMDR Act specifically excludes pitting, trenching, subsurface excavation, ordrilling (except drilling of bore holes as specified by the Central government) from thedefinition of reconnaissance operations. The Committee headed by the Additional Secretary,Ministry of Mines, mentioned in paragraph 4 of the Introduction, was in agreement with theview that some amount of pitting, trenching, and surface drilling needs to be allowed.However, there is also the view that RPs that permit too much exploration are counterproductivein that they tend to be used as PLs on smaller areas while leaving large areasunexplored. For this reason, prospecting activities such as pitting and trenching wereexcluded from the RP from the beginning. Clearly, RPs that permit any activity beyondregional exploration (such as pitting, trenching, and surface drilling) cannot be non-exclusivein nature as this would tend to produce anarchy on the ground with a number of parties tryingto prospect at or near the same spot at the same time. Further, there are certain technologiesnow available for more intensive regional exploration such as deep imaging andelectromagnetic probing, which are very expensive and not likely to be used by a nonexclusiveRP holder. It is, therefore, necessary to balance the pros and cons of a nonexclusiveRP vis-à-vis an exclusive concession. In this background, it is proposed that inaddition to the non-exclusive RP the earlier concept of an exclusive LAPL be reintroduced,with the conditionality of exploration technology and expenditure being not only severe butalso laid down in great detail in the MCR and applied rigidly. In such LAPLs, not only wouldpitting, trenching, and surface drilling be automatically permitted (as they are PLs meant fordetailed exploration) but also the use of other expensive technical innovations for regionaland detailed explorations would be automatically encouraged. This could include aerialsurvey using technologies superior to those used by GSI. Thus, while LAPLs may not begranted for entirely greenfield areas (except on technology considerations) the reconnaissancedata to be furnished need not go beyond GSI’s P2-level data. The MCR will need to lay downdata requirements in rigorous detail. It goes without saying that in the case of the LAPLholder also the transfer to a ML will have to be seamless and assured as long as it is based onwork done by the LAPL holder in his area. The issue of differential treatment in respect ofarea and duration required for the LAPL is dealt with in subsequent paragraphs.1.42 Since the purpose of the RPs is to supplement the regional exploration work of GSIand other public sector agencies, such RPs would be given for areas on which GSI has notdone any exploration work at all (except geological mapping) or has abandoned the work28

after the P1 or P2 stage. LAPLs, meant for those who would like to collect additional data byway of exploration before applying for a ML or who would like to undertake regional as wellas detailed exploration using expensive technologies, hence would normally be given notonly for greenfield areas (on technology considerations) but also for areas given up by GSIand/or RP holders even after work upto the E1 level.1.43 As regards PLs in RP held areas, in the current dispensation the exclusivity clauseensures that no application for a PL can be entertained where a RP is in operation. However,it is argued that such exclusivity militates against the basic concept of RP, which wasintroduced mainly to invite private sector initiative and investment into regional explorationand, thereby, supplement and add to the work done by GSI. If RPs are granted for areaswhere GSI or a government agency has already completed regional exploration and generatedadequate data warranting detailed exploration then a RP for that area would become counterproductivein that it would not only duplicate reconnaissance work where this has alreadybeen done but also hold up the detailed exploration work for the duration of the RP in the RPheldarea. Conversely, it is argued that the work of regional exploration done by GSI is toosketchy to enable an investor to take the decision to invest in detailed exploration and thetechnologies available for geological information collection are now so advanced that GSIdata is too inadequate at the end of a regional exploration exercise (even up to E2 level) towarrant a PL. While the concept of LAPL can resolve this issue to some extent it is alsosuggested that an applicant be allowed to apply for a LAPL or a PL directly in the nongreenfieldareas allotted to one or more RP holders under the ‘open sky’ policy. Nongreenfieldareas refers to those areas that are given up by GSI after P1 or P2 work and also toareas relinquished by other RP holders whose data is put into the public domain after thelock-in period. Since a PL applicant has to prove the existence of a mineral occurrence notonly in law but also to justify the investment in prospecting no investor will risk an RPactivity in an area which has already been adequately explored by GSI, just as no LAPL/PLapplicant will risk investment unless adequate regional exploration data is available. Itfollows that the protection afforded to the LAPL/PL holder would need to be veryconsiderable. This is dealt with later in the subsection dealing with security of tenure.1.44 In the light of the discussions above, the following changes in respect of explorationlicences are recommended:29

permissible activities in order to make the reconnaissance operation more conclusive. Section3 <strong>of</strong> the MMDR Act specifically excludes pitting, trenching, subsurface excavation, ordrilling (except drilling <strong>of</strong> bore holes as specified by the Central government) from thedefinition <strong>of</strong> reconnaissance operations. The Committee headed by the Additional Secretary,Ministry <strong>of</strong> <strong>Mines</strong>, mentioned in paragraph 4 <strong>of</strong> the Introduction, was in agreement with theview that some amount <strong>of</strong> pitting, trenching, and surface drilling needs to be allowed.However, there is also the view that RPs that permit too much exploration are counterproductivein that they tend to be used as PLs on smaller areas while leaving large areasunexplored. For this reason, prospecting activities such as pitting and trenching wereexcluded from the RP from the beginning. Clearly, RPs that permit any activity beyondregional exploration (such as pitting, trenching, and surface drilling) cannot be non-exclusivein nature as this would tend to produce anarchy on the ground with a number <strong>of</strong> parties tryingto prospect at or near the same spot at the same time. Further, there are certain technologiesnow available for more intensive regional exploration such as deep imaging andelectromagnetic probing, which are very expensive and not likely to be used by a nonexclusiveRP holder. It is, therefore, necessary to balance the pros and cons <strong>of</strong> a nonexclusiveRP vis-à-vis an exclusive concession. In this background, it is proposed that inaddition to the non-exclusive RP the earlier concept <strong>of</strong> an exclusive LAPL be reintroduced,with the conditionality <strong>of</strong> exploration technology and expenditure being not only severe butalso laid down in great detail in the MCR and applied rigidly. In such LAPLs, not only wouldpitting, trenching, and surface drilling be automatically permitted (as they are PLs meant fordetailed exploration) but also the use <strong>of</strong> other expensive technical innovations for regionaland detailed explorations would be automatically encouraged. This could include aerialsurvey using technologies superior to those used by GSI. Thus, while LAPLs may not begranted for entirely greenfield areas (except on technology considerations) the reconnaissancedata to be furnished need not go beyond GSI’s P2-level data. The MCR will need to lay downdata requirements in rigorous detail. It goes without saying that in the case <strong>of</strong> the LAPLholder also the transfer to a ML will have to be seamless and assured as long as it is based onwork done by the LAPL holder in his area. The issue <strong>of</strong> differential treatment in respect <strong>of</strong>area and duration required for the LAPL is dealt with in subsequent paragraphs.1.42 Since the purpose <strong>of</strong> the RPs is to supplement the regional exploration work <strong>of</strong> GSIand other public sector agencies, such RPs would be given for areas on which GSI has notdone any exploration work at all (except geological mapping) or has abandoned the work28

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