ANDHRA PRADESH STATE MINERAL POLICY 2013

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1 ANDHRA PRADESH STATE MINERAL POLICY 2013 INDEX S.No. Subject Introduction Objectives 1. Survey & Exploration 2. Estimation of Mineral Resources 3. Strengthening of Mineral Administration 4. Grant of Mineral Concessions 5. MoUs & JVs enter into by State Government & Public Sector Undertakings 6. Scientific and Systematic Mining 7. Minor Minerals 8. Prevention and Control of Illegal Mining and Transportation 9. Mineral Based Industries 10. Implementation of the Policy Page I. INTRODUCTION: Andhra Pradesh occupies an area of about 2,76,800 Sq.Km and has a long coast-line of 960 Km spreading from Ichapuram in Srikakulam District in the North to Tada in Nellore District in the South. The State is bounded by Latitudes and North and longitudes and East. Physiographically, the State is divisible into three natural units from East to West. These are i) Eastern Coastal plain interspersed with Delta (ii) Eastern Ghats, the Nallamala and Erramala Hill Ranges and (iii) Deccan plateau dotted with hill ranges in the North. Administratively, the State is divided into 23 Districts and regionally into Coastal, Rayalaseema and Telangana Regions. Minerals are valuable natural resource being the vital raw material for infrastructure, capital goods and basic industries. The endowment is finite and non-renewable. Hence, the exploitation of minerals has to be guided by long term National Goals and Perspectives. The State Mineral Policy is an integration of National Mineral policy. The

2 main aim of the State Mineral Policy is to serve as a guiding force to translate the State s Mineral Potential into reality with the objectives of eco-friendly and sustainable mining. II. GEOLOGICAL CONTEXT: Geologically, the State forms a part of Peninsular India and is one of the most ancient land masses. The geological formations of Andhra Pradesh range from the most ancient to the recent. The State consists of igneous, Metamorphic & sedimentary formations. The Peninsular Gneissic Complex consists of Archaean Group covered by complex group of Gneisses and Schists. The Precambrian Sedimentary formation of the Cuddapah Super Group, Pakhal Super Group and Kurnool Group found in Kurnool, Cuddapah, Ananthapur, Chittoor, Nalgonda, Mahabubnagar, Guntur, Krishna and Khammam Districts. The Bhima s are found in the western part of Rangareddy District. The Gondwana Super Group is found in Khammam, Warangal, Karimnagar and Adilabad Districts. The Deccan Traps are found in Rangareddy, Nizamabad, Medak, Adilabad, East and West Godavari Districts. Outcrops of Tertiary formations are found in East and West Godavari and Visakhapatnam Districts and the Quaternary sediments as thick blankets of alluvium are found in the River Valleys, Deltas and along the East Coast. III. MINERAL RESOURCE: Andhra Pradesh s varied geology has rich and wide variety of minerals for many mineral specific industries. It is a store house for 48 minerals and more specifically for Gold, Diamond, Bauxite, Beach Sand, Limestone, Coal, Oil & Natural Gas, Manganese, Dolomite, Quartz, Feldspar, Precious & Semi-precious stones, Clays, Calcite, Steatite Iron Ore, Base Metals, Barites, Uranium, Granite, Limestone Slabs, Marbles, Dimensional Stones and other Building Minerals. The State with vast mineral potential has worked out certain strategies to explore, exploit and develop the mineral sector with the constructive co-operation of both private and public sectors. The State has focused on the inventory of mineral resources, key issues of legislation, objective & strategies in tune with the National Mineral Policy in accelerating the growth in the liberal regime and thereby leading to overall development of the Mining Sector. 1. OBJECTIVES: THE STATE MINERAL POLICY 2013 The Andhra Pradesh Mineral Policy has the following objectives: To create favorable environment for value addition of the minerals in the State. To enhance employment opportunities.

3 To explore mineral wealth of the State by adopting modern exploration techniques with a priority for strategic minerals like sand, iron ore, limestone and base metals. To promote mechanized and scientific mining keeping in view the environmental measures and mineral conservation. To promote development of human resources for meeting the requirements of mining and mineral based industries. To de-mystify procedures and achieve greater transparency in decision making. To strengthen infrastructural facilities in mineral bearing areas with special emphasis on linking existing infrastructure. To promote prospecting and mining of noble and base metals, fertilizer and industrial minerals. To simplify the rules and procedures to remove the hurdles and bottlenecks and to provide clarity in the interest of mineral development. To implement welfare measures for the Mine Workers. To introduce e governance. To encourage utilization of mine wastes/beneficiation of low grade minerals / ores. To meet the above objectives, the state will undertake the following jobs: 1. I. SURVEY & EXPLORATION : 1.1 The Directorate shall be equipped with State of the art technologies for exploration of minerals. 1.2 The Technical staff of the Department shall be trained in latest techniques and technologies, applicable for exploration of minerals within a time frame. 1.3 The State shall ensure the establishment of training schools in each District to develop Technical Resource persons having knowledge of Mining Laws and Regulations for their Employment in the Mines/Quarries to follow the Rules and Regulations. 1.4 To exploit the State Geological Potential, it shall be ensured that regional and detailed exploration shall be carried out systematically in the entire geologically conducive mineral bearing area using the State of the art techniques in a time bound manner. 1.5 State Geological Programming Board shall be responsible for drawing up action oriented plans in respect of geological mapping and regional resources assessment of the State in close co-ordination with all other agencies engaged in this task. 1.6 In the next decade, seabed mining is going to be the prime area for exploitation of various mineral resources. The State of A.P. endowed with longest coast line of about 960 Km. Though seabed mining subject falls in the administrative

4 jurisdiction of Government of India to draw the spin off benefits from seabed mining, the State Government shall initiate efforts The State Geological Board shall direct all efforts in materializing the opportunities that can be derived from seabed mining The Department shall formulate annual and five year rolling plans for exploration on regional scale to include the plans in CGPB The SGPB shall review the work done so far relating to the activity domain of marine sciences with special references to coastal Andhra Pradesh The SGPB shall coordinate the exploration work conducted by Government and private agencies as per the defined plan objectives and priorities The Director shall take active participation in CGPB committee on Marine Geology and Exploration and Coastal Geosciences. 1.7 State shall strengthen linkages and interactions among the various institutions engaged in research and development in the mineral sector to derive maximum benefit. 1.8 State shall give emphasis on the use of advanced geophysics and remote sensing techniques to detect deep seated mineralizations. 1.9 State shall encourage private investments in exploration particularly deep seated mineralization using advanced state of art technologies Attention shall be given to the survey and exploration of strategic minerals. 2. ESTIMATION OF MINERAL RESOURCES 2.1 It shall be ensured that the applicable United Nations Framework classification (UNFC) System is fully adopted and utilized for reporting mineral reserves. 2.2 The State Directorate shall liaise with Geological Survey of India and Indian Bureau of Mines in order to ensure the best possible synergy from the data base. 2.3 The key to attract investment in the mining sector is marking available relevant information in a way most useful for investment decision making. The State Directorate shall create and constantly update a website in order to ensure information regarding. State policies, Legislation and executive instructions make available to prospective investor and mining community. Availability of areas for prospecting and mining through creation of a Mining Tenement Registry and Resource Inventory.

5 Geological and Geophysical data in spatial as well as non special formats including data gathered during reconnaissance and prospecting after lock in period is over. 2.4 The state will create its own inventory of mineral resources in digitized form by uploading all the available exploration data in coordination with GSI and IBM. Resource inventory shall be in accordance with the latest version of the United Nations Frame work of Classification (UNFC) system. Detailed reports shall also be made available to the interested investors on cost recovery basis 3. STRENGTHENING OF MINERAL ADMINISTRATION 3.1 The Directorate, Regional and District Offices shall be modernized for better efficiency and good governance. 3.2 On-line processing of mineral concession applications shall be introduced. 3.3 The rules, policies, important circulars and orders issued from time to time will be made available at department s website etc. 3.4 The Regulatory Environment shall be made more conducive to investment. Deduction of Seigniorage Fee by the User Agency under G.O.Ms.No.23 issued by I&CAD Dept., shall have to be taken up with the concerned Engineering Departments at Government level by evolving suitable procedure to ensure accountability of mineral usage and regulation of mineral mining activity. 3.5 Transparency in allocation of Mineral Concessions shall be assured with security of tenure a concessionaire. 3.6 State shall actively encourage private investment in exploration and exploitation of mineral resources. 4. GRANT OF MINERAL CONCESSIONS 4.1 Disposal of mineral concession applications within prescribed time frame of rules shall be ensured. 4.2 First in time and continuity or seamlessness principles shall be fully recognized. 4.3 Principal of seamless transition from reconnaissance permit to prospecting license and prospecting license to mining lease shall be honored strictly. However, Exemption of pre-requisition of PL for minerals like Gravel, Ordinary Earth, Morrum, Building Stone and Road Metal may be considered.

6 4.4 State shall frame and implement a transparent system of notifying the promising areas for grant of mineral concessions, and grant concession as per equitable and just criteria published in the notification. 4.5 In order to ensure that selection of concessionaries in notified areas follows as transparent and equitable system, it shall be ensured that Areas will be notified in a manner so as to reduce fragmentation and sterilization of reserves. To introduce Mining Zone Concept to avoid Urbanization near to the Mining areas and protect the long term Investments made by the Mining Sector. In case of large areas, manageable parcels shall be made. Selection of concessionaire shall be made in addition to capacity and capability, on the basis of captive requirements. 4.6 Priority under Section 11(5) of Mines and Minerals (Development & Regulation) Act, 1957 shall be on the following grounds: Priority shall be given, in sanctioning of minerals concession, to applicants having mineral based industries in the state but not having leases to feed the industry. Who has signed MOU (Memorandum of Understanding) with the State Government or Undertaking of State Government to establish unit for value addition of minerals in the State of Andhra Pradesh. Mining of mineral resources by using modern technique for minimal losses of minerals. Mineral Specific Exhaustion of captive capacity Ownership of the land of the recommended area Considering an adjoining area for mining in the interest of scientific and systematic mining and reduction in barrier loss. Large investment Value addition Long term ore linkage etc., 4.7 To resolve the problems of lessees / licenses in time, joint meetings will be held by the DMG at the level of concerned JDMG and ADMGs with the mining entrepreneurs once in 3 months. A special interdepartmental cell will be created in the secretariat to redress grievances of the mining entrepreneurs. 4.8 Delays in grant of clearances by the Revenue/Forest Departments will be minimized by monitoring through State Level Co-ordination Empowered Committee on quarterly basis.

7 5. MoUs and JV s enter into by State Government and Public Sector undertaking. The Memoranda of understanding and Joint Ventures constituted an important aspect of the proposals recommended by the State Government in respect of both notified and nonnotified areas. Joint Venture is also an important feature in cases relating to reservation in favour of PSU. 5.1 State shall ensure not to enter into MoUs for exploitation of mineral resources at a specific location in anticipation of a concession or a reservation. 5.2 In order to ensure that MoUs and Joint Ventures are not misused and in order to be eligible to be cited as special reasons, the MoUs and joint ventures related to Section 11(5) of MM (D&R) Act, 1957 should have a general clause in relation to Prohibition on assigning, sub-letting, mortgaging or in any other manner transpiring the concession rights without prior approval of Central Government Prohibition on change in terms and conditions of the MoU and JV s without prior approval of Government of India State shall ensure not making changes in management composition and control of the parties except in accordance with the provisions of the Act and prior approval of the Government of India In case of MoUs where an industry has been setup on the basis of MoU but mineral concession has not yet been granted as per the MoU, the State shall consider. All the MoUs shall be treated as single class for the purpose and first in time shall be recommended. The first in time principle in the case of MoUs will be reckon on the basis of date of MoU. 5.3 The Reservation of Mineral bearing areas for exploration by PSUs will be subjected to the condition that in case the PSU does not itself under take subsequent exploitation then State Government shall ensure application of following options: The Mineral Concessions granted through notification of the reserved area, the application of Section 11(2) & 11(3) of MM(D&R) Act, 1957 shall be ensured The Mineral Concession may be granted infavour of public sector undertaking and involve private sector for exploitation of minerals For the Mineral deposits explored by PSUs, the mineral concession may be disposed of through public auctions.

8 5.3.4 During the finalization of MoUs/JVs, bidding may be conducted. 6. SCIENTIFIC AND SYSTAMATIC MINING 6.1 There is a need to enforce scientific and systematic mining practice so that, the precious natural resources are not left un-utilized. For this purpose, the State Directorate. Shall endeavor to develop expertise in mining plans and mine closure management plan. Shall ensure that mining activities adhere to the approved mine plans. However, substitution of mining proposal in place of Mining Plans for less than 5 Hectares areas may be considered. Further, the Minor Mineral lease holders may be permitted to get the Mining Plans revised or altered at lower office levels during the period of validity of the said plans. Shall develop expertise in more beneficiation technique and preparation of techno economic feasibility reports. 7. MINOR MINERALS The State shall frame a scheme for the proper exploitation of minor minerals addressing environmental concerns. The indiscriminate Sand quarrying and soil for making earthen bricks are prime concern in respect of environmental degradation, depletion of ground water and loss of biologically rich top soils. 7.1 Sand bearing areas of Godavari, Krishna, Penna and their immediate lower order streams are the main source of quarrying of sand in the State. In delta regions, the Ground Water exists in unconfined aquifer state, removals of sand have direct and immediate effect on Ground Water recharge regime. There is no substitute for sand in construction activity except the sand manufactured artificially which is popularly known as Robo Sand. For the rough estimates the revenue collected for the year on sand is about Rs.120 Crores which is equivalent to about 30 million Tonnes or about Mts depth. It is the pertinent question does that much sand is replenished annually through floods. On any account the sand available in the State is going to exhaust in near future and introduction of substitution for sand at an early date will safeguard the ground water regime. Otherwise the State is going to invest huge amounts even on supply of drinking water to the public On account of exhaustion of sand year after year and ensure sustainable development the state shall initiate measures for substitution. The State shall promote artificial sand manufacturing industry through promotional incentives to entrepreneurs.

9 The State shall identify and declare exclusive mining zones for sand manufacturers. The Directorate shall identify suitable mineral bearing areas for steady supply of raw material in major urban centers such as HMDA, Visakhapatnam, Tirupathi and other non riverline districts. The Directorate shall make efforts to validate the vast deposits of quartzites of Kadapa basin and sand stones of Gondwanas in manufacture of artificial sand as sand become an exportable commodity in the neighboring states as well as island nations surrounding the Indian Peninsula. State shall ensure usage of manufacture sand in all Government and quasi Government works as an alternative to natural river sand in a phased manner depending on capacity building of manufacture sand units Since inception of Harappa civilization the Burnt Earthen Brick become a building stone in construction activity. But, in modern times, the construction activity has grown in many folds and to meet the demand, it obliges to remove top soil over hundreds of acres of fertile agricultural lands which is going unaccounted till to date. Fly ash brick possess all engineering as well as aesthetic values as good as earthen brick. Fly ash bricks are perfect substitution for conventional earthen bricks. In the absence of sufficient promotional campaigns, the usage of fly ash brick in construction activity not gained momentum. There is a misnomer in the eyes of the public that the hollow bricks and fly ash bricks are one and the same. Because of this misconception, the fly ash bricks not gained sufficient demand. Keeping in view of the ash generated from the existing as well as Coastal Green field thermal power projects, promotion of Fly ash brick industry become more eco-friendly measure to attain the goal of sustainable development. To protect the productive top soils and for clean environment, the State shall initiate measures in promoting substitution of fly ash bricks replace of conventional bricks. The State shall promote fly ash brick industry through promotional incentives for entrepreneurs. The State shall ensure promotional campaign and use every platform in the public domain for promotion of fly ash brick industry. The State shall ensure all administrative measures for study supply of raw material (Fly ash) to the manufacturers as a protective measure from cement industry. 8. PREVENTATION AND CONTROL OF ILLEGAL MINING AND TRANSPORTATION

10 8.1 Existing rules shall be made more stringent. 8.2 Granting and Renewal of Mineral Concessions to Defaulters and offenders shall not be consider. 8.3 Mineral Concessions shall not be granted to the persons having criminal background and antecedents are to be obtained before grant of Lease. 8.4 Identification of mineral bearing regions which are persistently prone to illegal mining for deploying special squads. The Integrated Check Posts shall be planned at Vulnerable places containing Mining, Commercial Tax, Transport and Police Departments as they are inter-related in terms of Revenue earning Departments to the State. 8.5 Weighing machines and check posts shall be setup in coordination with other departments on main routes of the State to ensure effective vigil. 8.6 System of e-permits shall be developed in the phased manner for transportation of minerals. 8.7 High-Level resolution satellite data shall be used to detect illegal mining. 8.8 Auditing of mineral reserves shall be initiated in case of bigger mines/quarries by charted accountant. 8.9 State shall convey State Empowered Committee and State Level Task Force periodical meetings without fail. 9. MINERAL BASED INDUSTRY 9. The State shall make efforts to attract mineral based industry into the state to add value and increase economic activity. 9.1 Application from new industries for areas notified for prospecting of mining shall be considered in an equitable manner with the following criteria to the extent specified in the notification. Non-availability of adequate ore linkage. Pioneering nature of the industry in a location. Induction of High end sophisticated technology. Beneficiation or value addition at ore stage. Better utilization of run of the mine. 9.2 New mineral based industries shall be encouraged for setting up of units in or near mineralized areas through appropriate tax and other incentives.

11 9.3 The State shall enter into equitable arrangements for supply of water, power and other infrastructure inputs. 9.4 The State shall ensure proper allocation of funds collected through cess on mineral bearing areas to the development of infrastructure in the mineral bearing areas. 10. THE IMPLEMENTATION OF THE POLICY Implementation of the policy will be ensured through the twin mechanism of the State Geological Programming Board and the State Empowered Committee.

*** The following Notification shall be published in an extra-ordinary issue of the Andhra Pradesh Gazette dt

*** The following Notification shall be published in an extra-ordinary issue of the Andhra Pradesh Gazette dt GOVERNMENT OF ANDHRA PRADESH ABSTRACT Mines and Minerals Punitive Measures to control Illegal Mining and Transportation of Minor Minerals Amendments to A.P. Minor Mineral Concession Rules, 1966 - Orders