New Delhi | Apr 23, 2015:All Odisha Steel Federation (AOSF) has urged the Centre to grant state governments power to reserve end-use in case of composite mining licence too, similar to what is being proposed for mining leases (ML).

The concept of a composite licence, prospecting licence (PL)-cum-ML, for an area where there is inadequate evidence of mineral contents has been introduced for the first time in the recently passed Mines and Minerals (Development and Regulation) Amendment (MMDRA) Act.

PL is granted for exploring, locating and proving mineral deposits. ML is required finally to extract minerals.

According to the draft mineral auction rules under MMDRA Act, “the state government may in its discretion identify a specific end use” as a prerequisite for auction of ML.

According to AOSF, most of the mines which will be put up for auction by the Odisha government will be for composite licenses, considering the fact that Odisha government gave extension to remaining 26 iron-ore MLs a few days ago.

"The eligibility criteria for auction of (composite licence) PL-cum-ML should be the same as that of ML," said AOSF in its letter to the government, adding that if a iron-ore mine is reserved for "integrated steel plant" for ML, it should be reserved for composite licence too.

Most of these steel companies are worried that merchant miners, who are in much better shape, will bid very aggressively making it unviable for steel companies which are already facing a slowdown.

(Source: http://www.business-standard.com/)