Iron Ore Auction: What We Interpret From Indian Minerals Laws Amendment Ordinance 2020?

Iron Ore Auction

India government has notified the amended mining law which allows the seamless transfer of regulatory approvals like forest and environmental clearances to new owners of operational iron ore mines. This ordinance will come in effect from 10th Jan 2020.

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Our Interpretation of the Mineral Law Amendment 2020

1. Ordinances are laws that are promulgated by the President of India on the recommendation of the Union Cabinet, which will have the same effect as an Act of Parliament. They can only be issued when Parliament is not in session. They enable the Indian government to take immediate legislative action

2. State government can auction mining leases before expiry of lease period

3.Successful bidder of the expiring mining leases through auction are deemed to have acquired all rights, clearances, approvals vested with previous bidder for a period of 2 years

4. The transfer is subject to condition that successful bidder will apply and acquire new licenses, clearances and approvals within 2 years from the date of grant of new lease

5. This means successful bidder has to operate at EC limits granted to previous lessee for a period of 2 years (state government has emphasized to produce at-least 80% of previous year’s production)

6. Successful bidder can start operations on the land in which mining operations were carried out by previous lessee for a period of 2 years.

Market expects the amendment to mining law will ease transition of iron ore mines to winning bidder post auction of the blocks whose leases are set to expire in March. This will limit the scope of disruption in iron ore supply subject to things goes as per schedule.

To learn how the mines auction 2020 unfolds, be a part of SteelMint Events’ 4th Indian Iron ore, Pellet and DRI Summit which is scheduled on 2-3 March 2020, in Hotel LaLiT, New Delhi.

9 Comments
  1. Piyush Agrawal

    Expect iron ore prices to fall in domestic market

  2. Rajan Behra

    But there is very tight availability of iron ore at the moment. No Odisha miner is willing to offer before March 2020. I feel prices will sustain at least till May 2020.

  3. Jayajit Nayak

    When is SAIL’s iron ore auction? Heard they will not offer high grade ore.

  4. AK Panda

    There is no clarity of left over inventories post mining auction. Officials say previous lessee can sell with within 6 month and simultaneously new lessee can start production. It is going to be a mess

  5. Bhowmick

    MMDR act says new lessee has to take forest clearance for entire lease, however many leases have clearances for partial land. Can it create some problem

  6. Sanjay Pattnaik

    Odisha pellet makers are not offering pellets below Rs 6,500/t. Shall we buy it at these levels?

  7. John Li

    What are estimates for iron ore imports to India? Can it cross 15 million ton in 2020?

  8. Anand Banerjee

    Heard OMC will increase iron ore production in 2020-21. Can they cross 20 million?

  9. Pankaj Goyal

    OMC got stage-2 clearance for extension of EC for its two mines Daitari and Kurmitar for 6 million tonnes each

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