 "Karnataka sets ball rolling for auction of Category 'C' mines")
The Karnataka government has started the process to auction iron-ore mines under Category C by a Supreme Court direction.
The combined capacity of all these mines is five million tonnes a year.
“As directed by the Supreme Court, we have cancelled all the 51 mining leases in Category C. There are a lot of issues to be sorted before we proceed with the reallotment of these mines to end users. We have vested all the mines with the state-owned Mysore Minerals Limited (MML), which will do the auction process,” S Shankar-anarayana, director, department of mines and geology, government of Karnataka told Business Standard.
He said the department would soon approach the Centre for approval. Once this comes, the department will proceed with preparation of auction files, he said.
He added there was no time frame to complete the process. However, sources said reallotting would take more than a year, as it was a ‘first of its kind’ in the history of Indian mining. “Till now, we have not seen auctioning of iron ore mines and Karnataka is set to create an example. There are no set of procedures for auctioning and the state government is yet to put in place detailed guidelines,” R K Bansal, additional secretary-general, Federation of Indian Mineral Industries (Fimi), said.
Tushar Girinath, secretary, mines, government of Karnataka, told a Fimi annual conference last week that the process of allotting mines would take some time as the government was yet to collect penalty from existing owners for large-scale illegal mining, as directed by the court.
The Central Empowered Committee of the court had categorised 166 leases under A, B and C categories by the extent of the illegalities committed. Category A comprised 45 mines that had negligible or no illegalities. Category B comprised 72, where pits were found outside the lease area, and Category C 51 mines that had done mining in area outside their lease boundaries, which was 15 per cent more than their given lease area.
The court had allowed 45 Category A mines and 67 Category B mines to resume mining subject to fulfillment of statutory conditions like implementation of reclamation and rehabilitation plans.
It had directed the state government to reallot Category C through a transparent process of bidding to the highest bidder from among end users. The court also said the floor price for such auctions would be based on market value, and the ore should be used for captive purposes only. It also restricted the export of such ore.
The combined capacity of all these mines is five million tonnes a year.
“As directed by the Supreme Court, we have cancelled all the 51 mining leases in Category C. There are a lot of issues to be sorted before we proceed with the reallotment of these mines to end users. We have vested all the mines with the state-owned Mysore Minerals Limited (MML), which will do the auction process,” S Shankar-anarayana, director, department of mines and geology, government of Karnataka told Business Standard.
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He said the department would soon approach the Centre for approval. Once this comes, the department will proceed with preparation of auction files, he said.
He added there was no time frame to complete the process. However, sources said reallotting would take more than a year, as it was a ‘first of its kind’ in the history of Indian mining. “Till now, we have not seen auctioning of iron ore mines and Karnataka is set to create an example. There are no set of procedures for auctioning and the state government is yet to put in place detailed guidelines,” R K Bansal, additional secretary-general, Federation of Indian Mineral Industries (Fimi), said.
Tushar Girinath, secretary, mines, government of Karnataka, told a Fimi annual conference last week that the process of allotting mines would take some time as the government was yet to collect penalty from existing owners for large-scale illegal mining, as directed by the court.
The Central Empowered Committee of the court had categorised 166 leases under A, B and C categories by the extent of the illegalities committed. Category A comprised 45 mines that had negligible or no illegalities. Category B comprised 72, where pits were found outside the lease area, and Category C 51 mines that had done mining in area outside their lease boundaries, which was 15 per cent more than their given lease area.
The court had allowed 45 Category A mines and 67 Category B mines to resume mining subject to fulfillment of statutory conditions like implementation of reclamation and rehabilitation plans.
It had directed the state government to reallot Category C through a transparent process of bidding to the highest bidder from among end users. The court also said the floor price for such auctions would be based on market value, and the ore should be used for captive purposes only. It also restricted the export of such ore.