National Mineral Policy 2006 - Department of Mines

per plan should be significantly higher than the prescribed penalties (as of 30June 2006).Mining Leases1.45 MLs cannot not be given unless there is ample evidence of an adequately prospectedore body, i.e. data describing in detail the entire ore body which is the end product of asuccessful PL operation. However, the current dispensation does not lay down thisrequirement clearly, except Section 5(2)(a) of the MMDR Act, which requires only proof ofmineral occurrence resulting from a RP (simple reconnaissance or regional explorationexercise). Of course, the requirement of a mining plan takes care of this issue to a certainextent but the Act needs to clearly lay down this requirement and the MCR should lay downin detail the nature of data to be provided in respect of each parameter. It may be mentionedthat this is one of the main reasons why a large number of leases have remained nonoperational.MLs that have been given on the basis of RP data instead of PL data cannot beoperated as prospecting (detailed exploration) is still to be completed. ML holders who aremostly in the small and medium enterprise (SME) sector have neither the knowledge nor thefunds required for detailed exploration and hence the MLs remain idle.1.46 MLs are granted in two kinds of areas, viz. areas prospected by a PL holder and areasprospected by State agencies with well-delineated, i.e. fully prospected, ore bodies ready formine development and mineral extraction. The issues concerning the former are dealt with inparagraphs 1.58 and 1.59 below, which deal with security of tenure. The issue of grantingMLs in respect of ore bodies fully prospected by public agencies at public expense has alsobeen discussed earlier in paragraph 1.32 above. It has been proposed in the interest oftransparency and for augmenting state revenues that the free distribution of such mineralresources may be done away with and that the ore bodies be disposed of through atender/auction process as a matter of policy. For the tender/auction process to be introduced,it will be necessary to amend the MMDR Act to grant the power to make disposals and alsoamend the rules to provide a transparent procedure for such disposals. At present, the disposalof such ore bodies is done along with other areas on a simple first-come-first-served basis[Section 11(2)] or where an area is notified in terms of Section 11(4) by inviting applicationsand selecting one among several applications on the broad parameters mentioned in Section32