Indian Mineral Policy

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In India, there are large numbers of minerals, for which exploration has & is taken & taking place by large number of agencies: government and private, which are under Indian system of classification of resources (In the year 2003, Government adopted the UNFC vide Gazette Notification No.185 dated 17.4.2003, through amendment to Mineral Conservation & Development Rules, 1988. UNFC also takes major  part in new National Mineral Policy, 2008.), and activities are governed by a set of Central and State acts and rules. The database is maintained by the Indian Bureau of Mines (IBM) for non-coal solid minerals, by the Geological Survey of India (GSI) for coal and lignite, and by the Department of Petroleum & Natural Gas for oil and natural gas.

1. MINERAL ADMINISTRATION AND RESOURCE ESTIMATION IN INDIA

Solid minerals Classification: Broadly into two as (1) Minor minerals (Granite, marble, sandstone, slate, bentonite, fuller’s earth, road metals, brick earth etc.) and (2) Major minerals (Coal, iron ore, base metals, bauxite, rock phosphate etc.). According to Indian Constitution State is the owner of mineral resources & Central or The union Government has powers to make laws in regulating exploration and mining.

1.1. ACTS & RULES FOR EXPLORATION AND MINING ACTIVITIES IN INDIA:

·         Mines Act (mainly concerned with safety of workers)

·         Oil Fields (Regulation & Development) Act (mainly for regulation of exploration and mining of oil and natural gas).

o   Petroleum Concession Rules.

·         Atomic Energy Act (Stipulates some special conditions for atomic minerals).

·         Mines & Minerals (Development & Regulation) Act (MMDR Act) (mainly for all solid minerals onshore)

o   Mineral Concession Rules (MCR),

o   Mineral Conservation & Development Rules (MCDR)

o   Granite Conservation & Development Rules (GCDR)

o   Marble Development & Conservation Rules (MDCR)

o   Separate Minor Mineral Concession Rules (MMCRs) of each State.

·         Coal Mines (Conservation & Safety) Act.

·         Offshore Area Mineral (Development & Regulation) Act.

·         Various other Acts concerned with welfare of labor.

1.1. A. MMDR Act:

MMDR act mainly used for Solid minerals regulates the exploration and mining activities. For doing, it provides 3 types of concessions in carrying out exploration & mining activity

·         Reconnaissance Permit (RP),

·         Prospecting License (PL) and

·         Mining Lease (ML).

Free hold areas: The areas not under ML are called “free hold areas” and RPs and PLs are granted only in such areas. But resource assessment may take place at any of the above stages.

Exception from MMDR: Organizations like the GSI, Directorates of Geology & Mining (DGM) of various state governments, etc. can carry out exploration work and resource assessment without formally taking RP or PL.

Mining Plan & Reporting under MMDR: This Act also provides for ‘mining plans’ of which preparation and getting IBM’s approval is the responsibility of the prospective entrepreneur who wants ML. A mining plan must, inter alia, contain estimates of resource properly classified under different categories as per guidelines issued by IBM. So far as non-coal major minerals are concerned, all resource estimations in mines are required to be properly classified, recorded and reported to IBM under MCDR. For coal, there is no such statutory stipulation. So far as minor minerals are concerned, there are specific stipulations for reporting of resource
estimates to IBM in case of granite mines (under GCDR) and marble mines (under MDCR). For other minor minerals, the state governments are solely responsible and the Union Government has no role on this issue. The Offshore Area Mineral (Development & Regulation) Act is a recently notified act (31st January, 2003), and in future, if and when offshore exploration and mining activity starts, it will be the obligation of the licensees and lessees to report to IBM, data on resource estimations.

1.2. ADMINISTRATIVE SYSTEM: There is a multiplicity of governmental agencies concerned with administration of different acts and rules and with different responsibilities related to exploration, mining and resource estimation:

(A) Union Ministry of Mines: Responsible for grant of concessions, regulation and development of mining of all non-coal solid minerals.

·         I.B.M. : Administration of MCDR, issue of guidelines for and approval of mining plans for non-coal non-atomic major solid minerals, resource estimation in non-coal non-atomic major solid mineral mines, preparation and maintenance of national inventories of non-coal solid minerals for both freehold and mining lease areas, maintenance of statistics for mines and minerals. In future, responsibility of regulation and development of mines of all solid minerals in off shore areas.

·         G.S.I.: Geological mapping, preliminary and general exploration in both on-shore and off-shore areas on promotional basis, preparation and maintenance of inventory of coal and lignite.

·         Mineral Exploration Corporation: A public sector exploration company engaged in detailed exploration of selected deposits of solid minerals on both promotional basis and commercial terms.

·         Public sector mining companies: Detailed developmental exploration and mining in a few mines of copper, bauxite.

(B) Union Ministry of Coal: Responsible for grant of concessions, regulation and development of coal mining.

·         Department of Coal: Approval of mining plans.

·         Coal Controller: Collection and maintenance of statistics.

·         Central Mine Planning and Design Institute: A public sector company engaged in detailed exploration of coal mining blocks.

·         Public sector coal mining companies engaged in mining of coal deposits.

(C) Union Ministry of Steel: Public sector mining companies engaged in detailed developmental exploration and mining in the mines of some steel input minerals (e.g. some of the iron ore, manganese ore, limestone, dolomite mines).

(D) Union Ministry of Petroleum & Natural Gas: Responsible for grant of concessions, regulation and development of exploration and mining activities- both onshore and offshore, maintenance of statistics related to oil and gas, partly exploration & production of oil and gas.
(E) Union Ministry of Fertilizer and Chemicals: Detailed developmental exploration (partly) and mining in some mines of pyrites, phosphorite.

(F) Union Ministry of Labor:

·         Directorate General of Mine Safety: Mainly concerned with safety and welfare of all mine workers, but also has some role (jointly with IBM) in approval of mining plans for
non-coal, non-atomic, major solid minerals.

(G) Department of Atomic Energy: Has some special powers related to atomic minerals; also general and detailed exploration for atomic minerals, and mining of some atomic mineral deposits through public sector mining companies.

(H) State Governments: Responsible for grant, regulation, and development of all minor mineral licenses and leases in onshore areas.

·         DGMs or its equivalents: General exploration for all solid minerals.

·         Public sector mining companies: Development and mining of some major and minor minerals.

1.3. SYSTEM OF EXPLORATION AND RESOURCE ESTIMATION: As can be seen from the earlier account, there are at least 5 Union Government agencies, 29 state government agencies, a number of Union and State Government mining companies, besides about 3000 private sector working mines and many idle mines — all are engaged in exploration, development and resource evaluation of solid minerals for different objectives, in either freehold or leasehold areas. The objectives can be preparation of mining plans, fulfillment of statutory
obligations of reporting resource data to IBM, improvement in the knowledge base of the mineral wealth of the country, national planning for resource development and management, etc. Besides, there are dedicated ministry and agency for exploration of oil and natural gas. So far as the solid minerals are concerned, the exploration programmes and activities of all Union and State Government agencies are coordinated through the mechanism of the State Programming Board of each state, and finally the Central Geological Programming Board. Consequently, the same deposit may be explored by different agencies at different stages or by the same agency at different times. This may happen with change of land status from freehold to leasehold or without change. But the net result is that in the same deposit, at any point of time, resources in different parts may be estimated under different categories at different confidence levels. The resource estimation is a dynamic exercise, and the categories tend to progress from “resource” to “proved reserve”, and conceptually, the exercise can never be assumed to be complete until either the entire deposit is explored in details with reserve under the highest category, or the entire deposit is mined out.

National Mineral Inventory: The output of all exploration and mining activities by all agencies at all times goes to form the input for national mineral inventories. In India, the mineral inventories are at present maintained in 3 organizations. The inventory of onshore non-coal solid minerals is the responsibility of IBM (over 16,000 deposits, leases and mines of 64 minerals covered at present and updated quinquennially); that of onshore coal and lignite is of GSI (annual); while that of petroleum and natural gas — both onshore and offshore updated every year by the Ministry of Petroleum and Natural Gas; and the summaries of all the inventories are published by IBM.

An inventory at a particular point of time, reflects the up-to-date results of all exploration and mining activities (which, inter alia, include reserves and resources classified into categories according to the prevailing Indian system) carried out for years and decades, till that point of time. These inventories form the basis of national planning, policy formulation, exploration programming, and also various micro-level decisions (e.g. infrastructure, investment etc.) pertaining to mineral sector. The national mineral inventories serve as the mirror of the resource classification system in vogue in India at any point of time, and any change in this will ultimately have to reflect itself in the inventories.

For Indian & UNFC Classification System to follow this link INDIAN to UNFC system