KOLKATA (miningweekly.com) – The Indian government has tasked three government-owned mineral and metal companies to act as specialised geological exploration agencies.
Iron-ore miner NMDC, integrated steel producer Steel Authority of India Limited (SAIL) and iron-ore pelletisation company KIOCL would join the ranks of Geological Survey of India (GSI) and Mineral Exploration Company Limited (MECL) as specialised exploration agencies with a mandate to complete regional geological surveys across the country within the shortest possible time.
An official in the Steel and Mines Ministry said that, for the auctioning of mineral reserves to be expedited, the number of companies mandated to undertake exploration had to be increased, as large parts of the country were yet to be surveyed.
He said that mandating three metals companies to undertake geological surveys was the beginning and that the Ministry was keen to bring private companies, both domestic and foreign, into mineral exploration.
Towards this end, the Ministry had appointed a committee to look into options and create a framework of incentives for private exploration companies to invest in and undertake mineral exploration projects across the country, he added.
The Mines and Mineral Regulation and Development Act was amended earlier this year, offering the legal framework for private companies to undertake exploration, which, until now, had been the exclusive domain of government agencies such as GSI and MECL.
However, the country had fallen behind in completing the exploration projects undertaken by these agencies and lagged in new discoveries of mineral resources in comparison with countries such as China and South Africa, the official said.
According to the Ministry report, GSI identified 571 000 km2 of geological potential across the country but no project had been undertaken to explore this area, owing to a shortage of technological and funding resources available to the government agencies.
Meanwhile, the government earlier this week formally notified the National Mineral Exploration Trust (NMET) of its intentions, operationalising the fund to host its first meeting early next month to decide on norms to fund exploratory projects.
The initial corpus of the fund was expected to be around $76-million and NMET was also expected to provide inputs for a National Mineral Policy, currently on the anvil of the Steel and Mines Ministry, with the objective to raise the contribution of the mining sector to India's gross domestic product to 6%, up from 2% at present.
The NMET would be funded from contributions equivalent to 2% of royalties payable by miners.