Ministry of Mines has issued a crucial notification, G.S.R. 50(E), dated 21st January 2024, amending the Mines and Minerals (Development and Regulation) Act, 1957. The new rules, titled “Minerals (Other than Atomic and Hydro Carbons Energy Minerals) Concession Amendment Rules, 2024,” introduce significant changes aimed at regulating exploration licenses, extensions, and other aspects of mineral concession.
Mines and Minerals Concession Amendment Rules, 2024, bring significant changes to the regulatory framework governing mineral exploration and exploitation. Stakeholders in the mining industry must carefully review and comply with these amendments to ensure adherence to the revised rules and avoid potential penalties. The amendments aim to streamline processes, enhance environmental protection measures, and promote responsible mining practices.
MINISTRY OF MINES
NOTIFICATION
New Delhi the 21st January, 2024
G.S.R. 50(E).—In exercise of the powers conferred by section 13 of the Mines and Minerals (Development and Regulation) Act, 1957 (67 of 1957), the Central Government hereby makes the following rules further to amend the Minerals (Other than Atomic and Hydro Carbons Energy Minerals) Concession Rules, 2016, namely:—
1. Short title and commencement.—(1) These rules may be called the Minerals (Other than Atomic and Hydro Carbons Energy Minerals) Concession Amendment Rules, 2024.
(2) They shall come into force on the date of their publication in the Official Gazette.
2. In the Minerals (Other than Atomic and Hydro Carbons Energy Minerals) Concession Rules, 2016 (hereinafter referred to as the said rules), in rule 3, for the words, brackets, figures and letters, “and (ii) minerals listed in Part A and Part B of the First Schedule to the Act”, the following clause shall be substituted, namely:—
“(ii) minerals listed in Part A of the First Schedule to the Act; and (iii) minerals listed in Part B of the First Schedule to the Act having grade equal to or more than the threshold value as specified under the Atomic Minerals Concession Rules, 2016”.
3. In the said rules, after rule 9A, the following rule shall be inserted, namely:—
“9B. Exploration licence granted through auction.—(1) The exploration licence deed of the exploration licence granted to a successful bidder under sub-rule (4) of rule 19G of the Mineral (Auction) Rules, 2015 shall be in the format specified in Schedule V-A.
(2) The exploration licencee may, at any time, surrender a part or the entire area to the State Government, subject to following conditions, namely:—
(i) the surrender shall be made only after submission of the report of the operations undertaken upto the date of surrender in the area being surrendered in accordance with the scheme of reconnaissance or prospecting or both, as the case may be;
(ii) the surrender shall be made only after completing reclamation of the area being surrendered;
(iii) the exploration licencee shall state the reasons for retention of the area proposed to be retained by him and the boundaries of the area being retained and surrendered;
(iv) the area retained may be contiguous or non-contiguous area;
(v) the exploration licencee shall undertake reconnaissance or prospecting operations or both in the area retained in accordance with the scheme of reconnaissance or prospecting or both;
(vi) in case no such operations is proposed in any area under the scheme of reconnaissance or prospecting, the exploration licencee shall mandatorily surrender such area;
(vii) the State Government after being satisfied that the surrender of an area is conforming to the conditions specified in this rule, may accept such surrender;
(viii) a supplementary exploration licence deed shall be executed between the licencee and the State Government in the format specified in Schedule V-B for the part of the area retained at each instance of the surrender of area.
Provided that after three years from the date of execution of the exploration licence, the exploration licencee may retain an area not exceeding twenty-five per cent. of the total area covered under the original licence granted to him for the purpose of continuing reconnaissance or prospecting operations and shall surrender the remaining area in compliance of the above conditions and sub-section (11) of section 10BA.
4. In the said rules, after rule 10, the following rule shall be inserted, namely:—
“10A. Extension of period of exploration licence.—(1) An application for extension of an exploration licence under sub-section (10) of section 10BA for the purpose of completing reconnaissance or prospecting operations or both shall be made after three years from the date of its execution but at least ninety days before the expiry of the licence and shall be accompanied by a statement containing the following, namely:—
(a) reasons for seeking such extension beyond five years from the date of execution of the exploration licence deed;
(b) a report of the details of reconnaissance or prospecting operations or both undertaken by the applicant in the format as specified under rule 9 of the Mineral Conservation and Development Rules, 2017;
(c) the details of the area retained by the exploration licencee including the boundaries of that area;
(d) the details of expenditure incurred;
(e) the numbers of man days for which the work was undertaken; and
(f) the justification for the additional period required to complete the prospecting work.
(2) The State Government shall send an acknowledgement of receipt of the application to the applicant in Schedule II within a period of three days of receipt of the application.
(3) The State Government may condone delay in submission of an application made after the time limit specified under sub-rule (1), provided that the application has been made before the expiry of the period of the exploration licence.
(4) An application for the extension of the period of an exploration licence shall be disposed of by the State Government before the expiry of the period of the exploration licence.”.
5. In the said rules, in rule 11,—
(i) in the marginal heading, for the words “and composite licence”, the words “, composite licence and exploration licence” shall be substituted.
(ii) in sub-rule (1),—
(a) in the opening portion, for the words “prospecting licence holder or a composite licence holder”, the words, “prospecting licence, composite licence or exploration licence” shall be substituted;
(b) in clause (c),—
(A) the words “holding a prospecting licence or a composite licence” shall be omitted;
(B) the word “prospecting” shall be omitted;
(c) in clause (e), after the word “prospecting”, the words “or reconnaissance” shall be inserted;
(d) in clause (g), after the word “prospecting”, the words “or reconnaissance” shall be inserted;
(e) in clause (h), after the word “prospecting”, at both the places where they occur the words “or reconnaissance” shall be inserted;
(f) in clause (i), after the word “prospecting”, the words “or reconnaissance” shall be inserted;
(g) in clause (j), after the word “prospecting”, the words “or reconnaissance” shall be inserted;
(h) in clause (k), the word “prospecting”, at both the places where it occurs, shall be omitted;
(i) in clause (l),—
(A) for the words “prospecting operations”, the words “prospecting or reconnaissance operations” shall be substituted;
(B) for the words “prospecting licence”, the word “licence” shall be substituted;
(iii) in sub-rule (3), after the words “composite licence”, wherever they occur, the words “or an exploration licence” shall be inserted;
(iv) in sub-rule (5), after the words “composite licence”, at both the places where they occur, the words “or exploration licence” shall be inserted;
(v) in sub-rule (6),—
(a) after the words “composite licence”, the words “or exploration licence” shall be inserted;
(b) after the words “prospecting licence”, the words “or an exploration licence, as the case may be” shall be inserted.
(vi) after sub-rule (6), the following sub-rules shall be inserted, namely:—
“(7) Surrender of area shall be made in accordance with the provisions of rule 9B.
(8) The exploration licencee shall, within a period of three months of the completion of the operations for which licence has been granted, or from the date of expiry of the exploration licence, whichever is earlier, submit a geological report to the State Government and the Indian Bureau of Mines explaining the result of the reconnaissance and prospecting operations in the form of a geological report prepared in accordance with rule 5 of the Mineral (Evidence of Mineral Contents) Rules, 2015; identifying the area suitable for grant of a mining lease.
(9) The exploration licencee shall not in any manner disclose the information, scheme and reports prepared under these rules or any other geological information related to reconnaissance or prospecting operations to any person other than the Government or authority specified in these rules or any other rules made under the Act, without prior approval of the Central Government.
(10) If the exploration licencee fails to complete the reconnaissance or prospecting operations or both in accordance with the scheme of reconnaissance or prospecting or both, as the case may be, before expiry of the exploration licence for the areas retained by him, or fails to submit the geological report within the period specified in sub-rule (8), then,—
(i) he shall not be eligible to receive any share out of the auction premium of the mining lease granted in the area covered by his exploration licence;
(ii) he shall be debarred from taking part in any auction for grant of exploration licences in any State for a period upto three years; and
(iii) the State Government may forfeit the performance security.”.
6. In the said rules, in rule 12, in sub-rule (1), in clause (k), after the second proviso, the following provisos shall be inserted, namely:—
“Provided also that permission under the second proviso shall be granted only in case where such overburden or the waste rock or mineral below threshold value cannot be used for any of the purposes by reason of which use it can be called a mineral other than minor mineral:
Provided also that permission under this sub-rule may be revoked at any time after giving an opportunity of hearing to the lessee;”.
7. In the said rules, in rule 17, in sub-rule (2), the following shall be inserted, namely:
“Provided that if the mining or mineral processing operations in a mine is discontinued for a period exceeding two hundred and seventy days before the expiry of five years period for which the mining plan was approved on the last occasion; and the holder of the mining lease has sent the notice to the authorised officer and the State Government under rule 28 of the Mineral Conservation and Development Rules, 2017, the holder shall not be required to submit mining plan for review during the period of such temporary discontinuation, but shall submit the mining plan for review and obtain approval of the competent authority on the same before reopening of the mine.”.
8. In the said rules, in rule 23,—
(i) in the marginal heading, after the words “composite licence”, the words “or exploration licence” shall be inserted;
(ii) after the words “composite licence”, wherever they occur, the words “or exploration licence” shall be inserted;
(iii) in sub-rule (3), after the word “prospecting”, the words “or reconnaissance” shall be inserted;
(iv) in sub-rule (11), after the words “the lessee”, the words “or the licencee” shall be inserted.
9. In the said rules, in rule 23B,—
(i) in the marginal heading, after the words “composite licence”, the words “or exploration licence” shall be inserted;
(ii) in sub-rule (1) and (2), after the words “composite licence”, the words “or exploration licence” shall be inserted.
10. In the said rules, Schedule I, Schedule III and Schedule IV shall be omitted.
11. In the said rules, after Schedule V, the following Schedules shall be inserted, namely:—
“Schedule –V-A
[See rule 9A(1)]
Format of Exploration Licence
This deed for grant of an exploration licence (“Licence”) is made by and between the following, namely:—
PARTIES:
1. The Governor of [State], acting through [Department of Mines and Geology of the State] (the “State Government”).
AND
2. [Name of the licencee] [incorporated in India under the Companies Act, [1956/2013] with corporate identity number [CIN], whose registered office is at [address of registered office], India and principal place of business is at [place of business, if different from registered office]] OR [an individual who is citizen of India, having income tax permanent account number [number], residing at [address]] OR [persons listed in SCHEDULE A organised as a [firm/association of persons] in the name of [name of the firm or association of individuals], all of whom are Indian citizens and resident in India] (the “Licencee”).
BACKGROUND:
A. The Licencee had participated in an electronic auction for grant of an exploration licence, pursuant to which the Licencee has become eligible for grant of an exploration licence.
B. Accordingly, the State Government is now executing this Licence for grant of a Licence to the Licencee in consideration of the fee, royalties, covenants and agreements hereinafter reserved and contained on the part of the Licence to be paid, observed and performed.
1. DEFINITIONS
The expressions used in this Licence shall have the same meaning as ascribed to them under the Act and the rules made thereunder.
2. GRANT OF LICENCE
The State Government hereby grants the Licence to the Licencee over an area described in Schedule B (“Licence Area”) for conducting reconnaissance or prospecting or both reconnaissance and prospecting operations for a period of five years, commencing from the date of the execution of the exploration licence with respect to following mineral(s), [name of the minerals].
3. RIGHTS AND OBLIGATIONS
3.1. The rights and obligations of the State Government and the Licencee shall be as specified in the Act and the rules made thereunder, including without limitation the Minerals (Other than Atomic and Hydro Carbons Energy Minerals) Concession Rules, 2016.
3.2. Without prejudice to the generality of the foregoing,
(a) the Licencee shall,—
(i) at all times comply with the provisions of the Act and the rules made thereunder and any other applicable law;
(ii) make prompt payment of royalty and any other payment required to be made by the Licencee;
(iii) pay such compensation as may be assessed by lawful authority in accordance with the law in force on the subject for all damage, injury, or disturbance which may be done by the Licencee in exercise of the powers granted by this Licence and to indemnify and keep indemnified fully and completely the State Government against all claims which may be made by any person or persons in respect of any such damage, injury or disturbance and all costs and expenses in connection therewith;
(iv) take measures, at his own expense, for the protection of environment like planting of trees, reclamation of mined land, use of pollution- control devices, and such other measures as may be prescribed by the Central or State Government from time to time;
(v) without delay send to the Deputy Commissioner or Collector a report of any accident causing death or serious bodily injury or serious injury to property or seriously affecting or endangering life or property which may occur in the course of the operations under this Licence;
(vi) weigh or cause to be measured or weighed upon some part of the Licence Area all minerals from time to time won from the Licence Area, with [number of days] prior notice being given to the Deputy Commissioner or Collector every such measuring or weighing in order that he or some person on his behalf may be present thereat;
(vii) submit to the State Government a full report of the work done by the Licencee and disclose all information acquired by the Licencee in the course of the operations carried on under this Licence regarding the geology and mineral resources of the area covered by the Licence; and
(viii) pay stamp duty and registration charges as may be applicable in respect of this Licence.
(b) the State Government shall:
(i) have the right to, at all times to enter into and upon and to grant or demise to any person or persons whomsoever liberty to enter into and upon the Licence Area for all or any purposes other than those for which sole rights and Licence are hereby expressly conferred upon the Licencee, including without limitation, to make on, over or through the said lands such roads, tramways and ropeways as shall be considered necessary or expedient for any purposes and to obtain from and out of the said lands such stone, earth or other materials as may be necessary or requisite for making, repairing or maintaining such roads, tramways, railways and ropeways to pass and repass at all times over and along such roads, tramways, railways and ropeways for all purposes and as occasion may require;
(ii) have the right to appropriate any performance security provided by the Licencee in accordance with terms of such performance security and require the Licencee to replenish the performance security. In case the performance security has been provided through a security deposit after termination of the Licence and fulfilment of all obligations of the Licencee, such security deposit shall be returned to the Licencee after appropriate deductions without any interest; and
(iii) have the right to carry out or perform any work or matters which in accordance with the covenants in that behalf are to be carried out or performed by the Licencee, but have not been so carried out or performed within the time specified in that behalf, and the Licencee shall pay the State Government on demand all expenses which shall be incurred in such carrying out or performance of the same.
3.3. If the State Government is desirous of exercising its right of pre-emption with respect to any mineral(s) the State Government shall pay the average sale price of such minerals as published by Indian Bureau of Mines prevailing at the time of pre-emption.
Provided that no such amount shall be payable for any mineral(s) other than those specified in the Seventh Schedule.
3.4. In the event of the existence of a state of war or emergency (of which existence the President of India shall be the sole judge and a notification to this effect in the Gazette of India shall be conclusive proof) the State Government with the consent of the Central Government shall from time to time and at all times during the said term have the right (to be exercised by a notice in writing to the licencee or licencees) forthwith take possession and control of the works, plant, machinery and premises of the Licencee on or in connection with the Licence Area or the operations under this Licence and during such possession or control, the Licencee shall conform to and obey all directions given by or on behalf of the Central or State Government regarding the use of employment of such works, plants, premises and minerals, provided that fair compensation, which shall be determined in default of agreement by the State Government shall be paid to the Licencee for all loss or damage sustained by him or them by reason or in consequence of the exercises of the powers conferred by this clause and provided also that the exercise of such power shall not determine the said term hereby granted or affect the terms and provisions of this clause.
3.5. If after the receipt of an offer of compensation for any damage which is likely to arise from the proposed operation of the Licencee, the occupier of the surface of any part of the said lands shall refuse his consent to the exercise of the rights and powers reserved to the State Government and granted by this Licence, the Licencee shall report the matter to the State Government and shall deposit with it the amount offered as compensation and if the State Government is satisfied that the amount of compensation is reasonable or if it is not so satisfied and the Licencee shall have deposited with it such further amount as the State Government may consider reasonable, the State Government shall order the occupier to allow the Licencee to enter upon the said land and carry out such operations as may be necessary for the purpose of the Licence. In assessing the amount of such compensation the State Government shall he guided by the principles of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation & Resettlement Act, 2013.
3.6. Every notice required to be given to the Licencee shall be given in writing to such person as may be nominated by the Licencee and such nomination shall be informed to the State Government in writing. If no such nomination is made then the notice shall be sent to the Licencee by registered post or speed post addressed to the Licencee at the address shown in the application for the Licence or at such other address in India as the Licencee may designate from time to time and every such service shall be deemed to be proper and valid service upon the Licencee and shall not be questioned or challenged by him.
3.7. If in any event the orders of the State Government are revised, reviewed or cancelled by the Central Government in pursuance of proceedings under the Minerals (Other than Atomic and Hydro Carbons Energy Minerals) Concession Rules, 2016, the Licencee shall not be entitled to compensation for any loss sustained by the Licencee in exercise of the powers and privileges conferred upon the Licencee by these presents.
4. GOVERNING LAW
This Licence and all questions of its interpretation shall be construed in accordance with the laws of India. In the event of any dispute in relation to the this Licence and in respect of all matters touching the relationship of the Licencee and the State Government, suits of petitions shall be filed in civil courts at [name of the city]) and it is hereby expressly agreed that neither party shall file a suit or appeal or bring any actions at any place other than the courts named above.
In witness whereof there presents have been executed at the [name of place] on [date].
SCHEDULE A –LIST OF PERSONS*
| Sl. No. | Name | PAN Number | Address |
* To be deleted if the Licencee is not an association of individuals.
SCHEDULE B: AREA OF EXPLORATION LICENCE
(Description of area, including Geo-coordinates, to be provided.)
Schedule –V-B
[See rule 9A]
Format of Supplementary Exploration Licence
This deed for grant of an exploration licence (“Licence”) is made by and between the following:
PARTIES:
1. The Governor of [State], acting through [Department of Mines and Geology of the State] (the “State Government”).
AND
2. [Name of the licencee] [incorporated in India under the Companies Act, [1956/2013] with corporate identity number [CIN], whose registered office is at [address of registered office], India and principal place of business is at [place of business, if different from registered office]] OR [an individual who is citizen of India, having income tax permanent account number [number], residing at [address]] OR [persons listed in SCHEDULE A organised as a [firm/association of persons] in the name of [name of the firm or association of individuals], all of whom are Indian citizens and resident in India] (the “Licencee”).
BACKGROUND:
A. The Licencee had participated in an electronic auction for grant of an exploration licence, pursuant to which the Licencee has become eligible for grant of an exploration licence.
B. The State Government has executed exploration Licence on………………for grant of a Licence over the area described in Schedule B (“Licence Area”) to the Licencee for a period from…………..to……………….. in consideration of the fee, royalties, covenants and agreements hereinafter reserved and contained on the part of the Licence to be paid, observed and performed.
C. On……………./after three years after such execution, the Licencee made an application to retain an area described in Schedule B-I/II/III…stating the reasons for retention of such area.
D. Accordingly, the State Government is executing this supplementary exploration Licence over the [retained area/final retained area after three years] as described in Schedule B-I/II/III..
E. All the other terms and conditions of the exploration licence shall be applicable to this supplementary licence.
1. DEFINITIONS
The expressions used in this Licence shall have the same meaning as ascribed to them under the Act and the rules made thereunder.
2. GRANT OF LICENCE
The State Government hereby grants the Supplementary Licence to the Licencee over an area described in Schedule B-I/II/III…(“Final/ Retained Area”) for conducting reconnaissance/ prospecting/ both reconnaissance and prospecting operations for balance period out of five years (for retained area)/ for a balance period of two years (for final area), from the date of the execution of the exploration licence with respect to following mineral(s), [name of the minerals].
3. GOVERNING LAW
This Licence and all questions of its interpretation shall be construed in accordance with the laws of India. In the event of any dispute in relation to the this Licence and in respect of all matters touching the relationship of the Licencee and the State Government, suits of petitions shall be filed in civil courts at [name of the city]) and it is hereby expressly agreed that neither party shall file a suit or appeal or bring any actions at any place other than the courts named above.
In witness whereof there presents have been executed at the [name of place] on [date].
SCHEDULE A –LIST OF PERSONS*
| Sl. No. | Name | PAN Number | Address |
* To be deleted if the Licencee is not an association of individuals.
SCHEDULE B: AREA OF EXPLORATION LICENCE
(Description of area, including Geo-coordinates, to be provided.)
SCHEDULE B-I: AREA OF SUPPLEMENTARY EXPLORATION LICENCE
(As retained out of the total area granted EL after surrender of part area)
(Description of area, including Geo-coordinates, to be provided.)
SCHEDULE B-II: AREA OF SUPPLEMENTARY EXPLORATION LICENCE
(As retained out of the total area granted EL after surrender of part area)
(Description of area, including Geo-coordinates, to be provided.)
SCHEDULE B-{N}: AREA OF SUPPLEMENTARY (FINAL) EXPLORATION LICENCE
(As finally retained after a period of three years from the date of execution of the EL)
(Description of area, including Geo-coordinates, to be provided.).”.
12. In the said rules, in Schedules IX and X, after the words “composite licence”, wherever they occur, the words “or exploration licence” shall be inserted.
13. In the said rules, for Schedule XII, the following shall be substituted, namely:—
“SCHEDULE-XII
[see rule 54(2)]
AMOUNT OF FINE
|
Rule No. |
Marginal heading of the Rule |
Amount of fine for leases having lease area up to 25 hectare and having per annum approved production capacity up to 2 lakh tonnes (in Rs.) |
Amount of fine for the cases other than those covered in column (3) (in Rs.) |
|
(1) |
(2) | (3) |
(4) |
| Sub-Rule (2) of rule 17 | Modification and review of Mining Plan | 1,000/- per day, subject to maximum 5,00,000/- |
2,000/- per day, subject to maximum 5,00,000/-”. |
[F. No. M.VI-1/3/2023-Mines VI (Part1)]
Dr. VEENA KUMARI DERMAL, Jt. Secy.
Note:—The principal rules were published in the Gazette of India, Part II, Section 3, Sub-section (i) vide number G.S.R. 279(E), dated the 4th March, 2016 and lastly amended vide number G.S.R. 737(E), dated the 12th October, 2023.
