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Offshore Areas Minerals Amendment Bill 2023 Introduced In Lok Sabha

Union Minister for Coal and Mines Pralhad Joshi introduced the bill in the Lok Sabha when the House assembled at 2 pm after an adjournment over the Manipur situation

Critical Minerals
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A bill to provide a fixed fifty-year production lease for offshore minerals was introduced in Parliament on Thursday.
    
Union Minister for Coal and Mines Pralhad Joshi introduced the bill in the Lok Sabha when the House assembled at 2 pm after an adjournment over the Manipur situation.
    
In May, PTI reported that the government is planning to introduce the Offshore Areas Minerals (Development and Regulation) Amendment) Bill 2023 in the monsoon session.
    
As per the statement of objects and reasons of the bill, it proposes to remove the provision for renewal of production lease and provide a fixed period of fifty years for production lease similar to the provisions of the Mines and Minerals (Development and Regulation) Act 1957.
    
The bill also proposes to introduce a composite licence, which is a two-stage operating right granted for the purpose of undertaking exploration followed by production operation. The composite license shall also be granted only through auction by competitive bidding to the private sector.
    
Besides, in the case of atomic minerals, the grant of exploration licence or production lease shall be made only to a government or a government or corporation.
    
The bill also provides a grant of production lease to the private sector only through auction via a competitive bidding process.
    
It aims to introduce a four-year timeline for commencement of production and dispatch after the execution of composite licence or production lease under and timeline of two years (extendable by one year) for re-commencement of production and dispatch after discontinuation.
    
It will enable the central government to frame rules for the conservation and systematic development of minerals in offshore areas and for the protection of the environment by preventing or controlling any pollution which may be caused by exploration or production operations.

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The statement said that India, despite having a unique maritime position with a long coastline touching nine coastal states and four union territories and two million square kilometres of exclusive economic zone, has not been able to tap its vast offshore mineral resources for its developmental needs.
    
Previous efforts of allocation of offshore blocks did not bear desired results due to a lack of legal framework for a fair and transparent mechanism to allocate the operating rights in the act and the stalemate caused due to pending litigations over the allocation of blocks.
    
There is an urgent need to introduce auction as the method of allocation of operating rights in the offshore areas to enable early allocation of operating rights through a transparent and non-discretionary process, it said.
    
"Also, there is a need to adopt other features of the Mines and Minerals (Development and Regulation) Act, 1957, such as the establishment of trusts for mining-affected persons and encouraging exploration, removing process of discretionary renewals and providing uniform lease period of fifty years, the introduction of a composite licence, providing for area limits, easy transfer of composite licence or production lease, etc," as per the statement.

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