GoM approves bidding contest for mineral exploring licences

After the opposition from mineral-rich states on Mines Ministry's proposal of 'first come first serve route' for grant of direct prospecting licences in mineralised areas, the GoM has recommended that states can adopt competitive bidding route.

"On the concerns of the State Governnment of Chhattisgarh and Orissa, the GoM (Group of Ministers) agreed to the introduction of suitable provisions on allowing the state Governments to call for competitive bids on areas where direct prospecting licences are filed," the panel recommended in its recent meeting as per an official document.

The panel, headed by Finance Minister Pranab Mukherjee, was of the view that the move would yield to better value for the deposits. The meeting was convened to iron out inter-ministerial differences on new mining legislation - Mines and Mineral Development and Regulation (MMDR) Bill.

States had opposed a provision of the bill, which proposed that 'first come first serve' route will be adopted for granting large area prospecting licences (LAPLs) instead of competitive bidding method. Prospecting License (PL) is granted for undertaking operations for purpose of exploring, locating or proving mineral deposit.

The LAPLs allow companies to prospect for mineral deposits in unknown mineralised large tracts of land