Centre increases mining area boundaries to boost critical minerals

19 Jul 2024 CW Team

"The Central Government, exercising the powers conferred under the proviso to clause (b) of sub-section (1) of section (6) of the MMDR Act, 1957, hereby increases the area limit for prospecting licence and mining lease for each of the 24 critical minerals listed in Part-D of the First Schedule to the MMDR Act, 1957, to 100 sq km and 50 sq km, respectively, for each of the States," the order stated.

This change comes after the Centre faced challenges in its initial auction of critical mineral blocks earlier this year. The source had previously reported on July 14 that 28 out of the 38 blocks announced in the first two auctions were annulled due to a lack of interest from potential bidders.

The policy shift is designed to address the unique challenges of mining critical minerals, which are often located in deep-seated deposits and have a lower recovery rate compared to bulk minerals like limestone and iron ore.

Initially, the area limits were established under the Mines and Minerals Development and Regulation (MMDR) Act to prevent cartelisation within the mining sector. However, recognising the strategic importance of critical minerals for various industries and national security, the government has decided to revise these limits.

"Critical minerals require extensive exploration and extraction efforts due to their deep-seated nature and low recovery rates from ore. Increasing the permissible area for mining and prospecting is crucial to make these operations economically feasible," an official said, noting that the decision falls within the provisions of the MMDR Act.

The MMDR Act allows the Centre to increase the area limits if it serves the interest of mineral development or the industry.

As the Centre expands the area limits for individual players, sector experts stress the importance of advancing technology to fully extract these minerals from the mines.

?There is an alarming trend of using broad terms such as ?strategically important? and ?national security? to support certain sectors or industries, and then selectively relaxing environmental compliances and public scrutiny,? commented Debadityo Sinha, Lead- climate & ecosystems, Vidhi Centre for Legal Policy, in a statement to the source. (Source: BS)

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In a strategic move to enhance the mining of critical minerals, the Centre has increased the permissible area for individual mining leases more than fourfold. According to an order issued, the area limit for mining leases has been expanded from the current 10 sq km to 50 sq km. Similarly, for prospecting licences, which are granted in the case of composite licences, the limit has been increased from 25 sq km to 100 sq km. The Central Government, exercising the powers conferred under the proviso to clause (b) of sub-section (1) of section (6) of the MMDR Act, 1957, hereby increases the area limit for prospecting licence and mining lease for each of the 24 critical minerals listed in Part-D of the First Schedule to the MMDR Act, 1957, to 100 sq km and 50 sq km, respectively, for each of the States, the order stated. This change comes after the Centre faced challenges in its initial auction of critical mineral blocks earlier this year. The source had previously reported on July 14 that 28 out of the 38 blocks announced in the first two auctions were annulled due to a lack of interest from potential bidders. The policy shift is designed to address the unique challenges of mining critical minerals, which are often located in deep-seated deposits and have a lower recovery rate compared to bulk minerals like limestone and iron ore. Initially, the area limits were established under the Mines and Minerals Development and Regulation (MMDR) Act to prevent cartelisation within the mining sector. However, recognising the strategic importance of critical minerals for various industries and national security, the government has decided to revise these limits. Critical minerals require extensive exploration and extraction efforts due to their deep-seated nature and low recovery rates from ore. Increasing the permissible area for mining and prospecting is crucial to make these operations economically feasible, an official said, noting that the decision falls within the provisions of the MMDR Act. The MMDR Act allows the Centre to increase the area limits if it serves the interest of mineral development or the industry. As the Centre expands the area limits for individual players, sector experts stress the importance of advancing technology to fully extract these minerals from the mines. ?There is an alarming trend of using broad terms such as ?strategically important? and ?national security? to support certain sectors or industries, and then selectively relaxing environmental compliances and public scrutiny,? commented Debadityo Sinha, Lead- climate & ecosystems, Vidhi Centre for Legal Policy, in a statement to the source. (Source: BS)

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