The Indian iron ore industry is expected to see some major changes in 2019-2020 amid mining auctions.
As of now, the auction process is mandated in law due to an amendment to the Mines and Minerals (Development and Regulation) Act (MMDR Act) enforced by the government.
MMDR Amendment Act, 2015 has laid out the guidelines for lease extension of non-captive mines till 31 Mar’2020 following which the leases shall be put up for auction for competitive bidding. Odisha – India’s largest iron ore producing state which also accounts for nearly 50% of share in country’s iron ore production is expected to be impacted the most. Around EC limit of 75-80 MnT pa will be at stake which is currently under possession of Odisha’s merchant miners.
According to All Odisha Steel Federation (AOSF), the Government of India is contemplating some changes in the MMDR Act and the government has asked the AOSF to give suggestions for the same. To expedite the process, the President of AOSF, Mr PL Kandoi urged all the members of AOSF to share their suggestions for amendments in the MMDR Act. This will help in smoothening the running operations of plants and improve the availability of iron ore at comfortable rates. Suggestions can be sent through e-mail at allodishasteelfederation@gmail.com
| Tentative Timeline for Mineral auctions 2020 | ||
| S No. | Activity | Timeline |
| 1 | Exploration of all working mines expiring in 2020 | |
| 1) Submission of exploration plan | Jul, 2018 | |
| 2) Completion of exploration and submission of report | April, 2019 | |
| 2 | Issuance of Notice Inviting tender of identifies mines for auction | |
| 1) Plan of sale and transfer of asset to be included in tender | May, 2019 | |
| 2) Issue of NIT | Jun-July, 2019 | |
| 3 | Declaration of preferred bidder | |
| 1) Holding e-auction | Sept, 2019 | |
| 2) Payment of 1st installment of upfront payment | Oct, 2019 | |
| 3) Grant of LoI | Oct, 2019 | |
| 4 | Approval of Mining Plan | |
| 1) Submission of Mining Plan along with 2nd installment (10%) of upfront payment (IBM to ensure right to inspection for the preferred bidder in the existing lease) | Nov, 2019 | |
| 2) Payment of performance security | Nov, 2019 | |
| 3) IBM inspection & Finalization of mining plan | Dec, 2019 | |
| 5 | Signing of MDPA | Jan, 2020 |
| 6 | Payment of 3rd installment of upfront payment (80%) | Feb, 2020 |
| 7 | Grant and execution of lease | Feb, 2020 |
| 8 | Joint inventory of transfer | Mar, 2020 |
Source: Ministry of Mines, Govt of India
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