Odisha’s Directorate of Mines has sought a clarification from the state government’s Department of Steel and Mines about the commencement of assessment to measure shortfall in mineral dispatches from the auctioned leases vis-a-vis the minimum dispatch requirement specified in the Mineral Concession Rule (MCR), 2016, SteelMint learnt from government sources.
Minimum dispatch requirement
The MCR, amended on 10 Jun’21, will come into effect from 1 Jul’21. The amended MCR stipulates that for mining leases that were executed on or before the commencement of the Mineral Concession (Third Amendment) Rule, 2021 the assessment of shortfall in dispatches shall apply after one year from the date of execution of mining lease or the date of commencement of the MCR (Third Amendment) 2021, whichever is later.
Out of 19 auctioned leases for which lease deeds were executed before the MCR (Third Amendment), 11 leases were executed during Jun’20 and are completing one year before 1Jul’21. These include four iron ore leases of JSW Steel as well as leases awarded to AM/NS India and merchant miner Serajuddin and Co. among others.
The Directorate has asked for clarification on whether the assessment of shortfall under rule 12(A) of MCR would be made on the date of completion of one year from the date of lease execution or the date of the commencement of the amended rule, which is 1 Jul’21.
Authorities seek to ensure compliance
Rule 12A (1A) of the MCR (Third Amendment) specifies that in case of any shortfall in dispatch in view of the minimum dispatch requirement, which shall be assessed on a quarterly basis, the lessee shall pay the amounts payable under rule 13 of the Mineral (Auction) Rules, 2015 for the actual dispatch.
In addition, the lessee has to pay the difference between the amount that would have been payable for the quantity that is stipulated as the minimum dispatch requirement in a particular quarter (on the basis of the weighted average of the grade of mineral dispatched during the quarter) and the amount paid on the basis of the actual dispatch in that quarter under rule 13 of the Mineral (Auction) Rules.
SteelMint earlier reported that Odisha’s Directorate of Mines is keeping tabs on the actual dispatch volumes from the auctioned leases. The state government has also sought compliance from the new lessees on critical issues pertaining to irregularities with stacking at the auctioned leaseholds. These issues surfaced after the regulatory authorities discovered that some new lessees were falling short of dispatching permitted volumes resulting in stockpiling of minerals and ore at mine sites.
Leave a Reply