Punjab launches auctions for mining sites across state

Chandigarh, Jan 11 (PTI) The Punjab government has launched fresh auctions for mining sites across the state and notified major reforms to the auction framework under the amended Punjab Minor Mineral Rules.

Reiterating the government's commitment to transparency and responsible resource management, Mining and Geology Minister Barinder Kumar Goyal on Sunday said, "Our government is committed to ending opacity in mining and ensuring that natural resources are used for the benefit of the people.

"By shifting to transparent online auctions, we are protecting state revenue, creating a level-playing field for genuine operators, and curbing illegal mining." In Phase 1, the government has auctioned 29 new Commercial Mining Sites (CMS) through an open and competitive online bidding process.

These auctions, floated in October-November, resulted in 16 successful bids and generated Rs 11.61 crore in revenue.

These are the first mining auctions conducted by the state in the last three years.

The state cabinet-approved reforms mark a decisive break from earlier volume-based auction systems, where bidders competed by offering to operationalise the maximum share of a site, an official statement said here.

In practice, many bidders quoted identical volumes, often 100 per cent, leading to selection by draw of lots. Over time, this approach resulted in reduced revenue realisation, proliferation of non-serious bidders, limited investment commitment, and delays in operationalising mines, as environmental clearances were the government's responsibility, it said.

To address these systemic flaws, the Cabinet has approved a series of structural reforms aligned with best practices followed across India.

Auctions will now be based on competitive price bidding, ensuring fair allocation and improved revenue outcomes. Bidders will be required to make upfront payments to demonstrate seriousness, and royalty payments will be collected in advance to ensure steady revenue flows.

Responsibility for obtaining environmental clearances has been shifted to bidders, a move expected to significantly reduce delays in making mines operational.

"Clear dead rent provisions have also been introduced to prevent speculative bidding by ensuring minimum payments even if mines are not operationalised.

"Additionally, lease tenures have been extended from three years to five years, providing greater stability and planning certainty to operators," the statement said.

The government has clarified that while 29 sites have been auctioned in Phase 1, nearly 100 additional sites will be brought to auction in staggered phases.

These reforms are expected to expand the legal supply of raw materials, accelerate operational timelines, strengthen regulatory clarity, and substantially increase government revenues.

The government affirmed that the combined impact of policy amendments, auction reforms and other steps represents a comprehensive overhaul of Punjab's mining sector, aimed at eliminating opacity, preventing monopoly, curbing illegal mining, and ensuring that natural resources are utilised for public benefit. PTI SUN HVA