Mines ministry proposes partial lease execution to speed up production from auctioned blocks, ETEnergyworld

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<p>India's mines ministry is proposing new rules to speed up mining operations. These changes will allow companies to start production in parts of mineral blocks even if forest clearances are pending. </p> — India’s mines ministry is proposing new rules to speed up mining operations. These changes will allow companies to start production in parts of mineral blocks even if forest clearances are pending.

New Delhi: The mines ministry has proposed expediting production from auctioned mineral blocks by permitting partial execution of leases for both forest and non-forest sections, a senior official told ET. This is expected to allow state governments to give speedier clearances for mines.

To streamline the process, a unified mining portal will be established to enable the execution of various procedures under the Mineral (Auction) Rules, the official said.

The ministry also proposes to reduce the time period from the issuance of the letter of intent (LoI) to the execution of the mining or composite lease.

These changes have been proposed under the draft Mineral (Auction) Second Amendment Rules, 2026.

“The state government may allow a preferred bidder to exclude the portion of mineral block containing forest area,” the official said, adding that this will allow mining activities to begin in the “good-to-go parts” of the blocks.

According to the draft rules, this provision can be allowed if the forest portion is at the edge of the block. Also, the estimated quantity of minerals in such portions should be less than 20 per cent of the total estimated quantity of mineral resources.

Under the proposed draft rules, a state may also allow preferred bidders to separately execute part of mining leases for non-forest and forest areas. “In case of execution of part mining lease, there shall be no reduction in the amount of upfront payment,” the draft rules said, adding that the Mine Development and Production Agreement shall be signed in two parts-one for the non-forest part and subsequently for the entire block area after obtaining all permits and “no objection” for the respective parts.

It has also been proposed to automatically issue the LoI through an online unified mining portal if required payments are made. This portal will be set up by the Centre in consultation with the state governments.

These are the latest changes proposed in the mining framework of the country. ET had reported earlier this month that India plans stricter rules for auction of mineral blocks, potentially including provisions to cancel leases if miners fail to start production and dispatch within two years of signing. At the same time, the Centre also plans to remove area curbs to draw more licensing-bid participants.