KOLKATA (miningweekly.com) – India’s Mines Ministry will soon be inviting bids for at least 20 mineral exploration blocks from domestic and international agencies to kick-start the New Mineral Exploration Policy (NMEP).

The bidding process will mark the maiden entry of private domestic and international exploration companies under the newly unveiled NMEP.

The 20 blocks will be the first lot from the 100 mineral blocks which have been selected for exploration by private domestic and international mineral exploration companies.

Last month, the Central Empowered Committee under the Mines Ministry met with all stakeholders, including provincial governments, to remove roadblocks to sharing geological data with prospective bidders.

The NMEP provides for launching mineral exploration projects through private agencies and, subsequently, the government will auction off the identified explored mineral blocks on a revenue sharing basis if "auctionable" resources are discovered.

Should exploration agencies not find auctionable resources, the policy provides for exploration investments and expenditures to be reimbursed on a normative basis.

Mines Ministry officials pointed out that the start of bidding was significant in as much as it would be government's first step towards its purported goal of achieving 22% growth in mineral production and, in turn, ramping up the mining sector’s contribution to gross domestic production to 2% from 1% at present.

As far as the government is concerned the Achilles Heel of Indian mining has been gross underexploration of potential mineral reserves. More so with exploration having until now been the sole domain of government agencies such as Geological Survey of India (GSI) and Mineral Exploration Corporation of India.

An indication of tardy exploration is evident from data sourced from the Mines Ministry, which reveal that these agencies have grossly missed drilling targets during 2015/16.

Government data show that GSI drilled 102 814 m during the year, against a target of 121 286 m for minerals such as iron-ore, manganese, rare earths and precious metals.

According to the data, a drilling target for iron-ore of 12 500 m was set, of which only 5 150 m were completed. For base metals, only 12 022 m of drilling was completed against a target of 17 100 m. For limestone, the target was 11 200 m and 9 850 m were achieved, while for coal the target was 47 500 m and 45 149 m were achieved.

It was also in this context and as reported by Mining Weekly Online on September 9, that besides inviting specialised domestic and foreign exploration agencies, the government was also pushing its State-owned mineral companies to transform into integrated ‘resource majors’ by undertaking mineral exploration projects.