India allows inclusion of contiguous areas in mining leases and composite licences
Change
India authorised one-time extensions to include contiguous areas in mining leases and composite licences, capped at 10% for mining leases and 30% for composite licences, and required holders of auctioned leases to pay 10% of the auction premium on minerals dispatched from added areas while non‑auctioned leases must pay an extra amount equal to the applicable royalty on such dispatches.
Why it matters
Leaseholders must use a new one-time, time-bound application process to obtain approval for contiguous-area additions. The rules apply to deep-seated minerals and permit inclusion of associated minerals, making administrative approval and revised dispatch accounting mandatory before production from added areas.
Implications
- • Holders of auctioned mining leases and composite licences must remit 10% of the original auction premium on any minerals dispatched from added contiguous areas and must update dispatch invoicing to reflect that levy, or be non-compliant with the notified rules.
- • Holders of mining leases and composite licences granted without auction must calculate and pay an extra charge equal to the applicable royalty on minerals dispatched from added contiguous areas and must update royalty accounting before dispatch, or be non-compliant.
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