The Minerals (Other than Atomic and Hydro Carbons Energy Minerals) Concession (Second Amendment) Rules, 2026

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Dated: 04.04.2026

The Minerals (Other than Atomic and Hydro Carbons Energy Minerals) Concession (Second Amendment) Rules, 2026

The Ministry of Mines, Government of India, has introduced significant amendments to the Minerals (Other than Atomic and Hydro Carbons Energy Minerals) Concession Rules, 2016, through the Second Amendment Rules, 2026. These amendments aim to streamline processes, enhance transparency, and ensure better regulation of mining activities across the country. Below is a detailed overview of the key changes and provisions introduced in the amendment.

Key Highlights of the Second Amendment Rules, 2026

1. Reporting and Inclusion of Discovered Minerals

The amendment mandates that lessees must report the discovery of any mineral not specified in their mining lease to the State Government within six months from the commencement of the amendment or sixty days from the date of discovery, whichever is later. Lessees are prohibited from extracting or disposing of the discovered mineral until it is officially included in their mining lease.

Additionally, lessees can apply to the State Government for the inclusion of other minerals, including minor minerals, in their mining lease. The State Government is required to permit the inclusion within sixty days of receiving the application, provided the provisions of Section 15B are met.

2. Sale of Minerals from Captive Mines

The amendment allows lessees to sell minerals produced in captive mines after fulfilling the requirements of the end-use plant linked to the mine. However, if the end-use plant operates below full capacity, the lessee can only sell a quantity of mineral equal to the amount consumed by the plant in a financial year.

3. Inclusion of Contiguous Areas in Mining Lease or Composite Licence

The amendment introduces Chapter VIII-A, which provides a framework for the inclusion of contiguous areas in existing mining leases or composite licences. Key provisions include:

Application Process: Lessees can apply to the State Government for a one-time extension of their leased area to include a contiguous area. The application must include details such as boundary coordinates, mineral potential, geological continuity evidence, and exploration agency details.
State Government Approval: The State Government must acknowledge receipt of the application within three days and decide on the application within sixty days.
Exploration and Prospecting: If approved, the lessee can engage an exploration agency to conduct prospecting operations in the contiguous area to establish the mineral resource.
Supplementary Mining Lease: Upon successful exploration and compliance with conditions, the State Government will execute a supplementary mining lease deed, co-terminus with the existing lease period.

4. Inclusion of Minerals Other than Minor Minerals in Minor Mineral Leases

The amendment introduces Chapter VIII-B, which allows the inclusion of minerals other than minor minerals in mining leases granted for minor minerals. Key provisions include:

Exploration Requirement: The State Government cannot grant a mining lease for minor minerals (other than sand) over areas larger than two hectares unless preliminary exploration (G3 level) is conducted to establish inferred mineral resources.
Reporting and Application: Lessees must report the discovery of minerals other than minor minerals within six months of the amendment’s commencement or sixty days from discovery. They can apply for inclusion in their lease, subject to compliance with exploration requirements.
State Government Decision: The State Government must decide on the inclusion within sixty days of receiving a complete application. However, atomic minerals with grades above the threshold value cannot be included, and the lease will be terminated upon discovery of such minerals.

5. Payment Obligations for Included Minerals

The amendment specifies additional payment obligations for lessees when contiguous areas or other minerals are included in their mining lease:

Contiguous Areas: Lessees must pay an additional amount equal to 10% of the auction premium for minerals dispatched from the included area (if the lease was granted through auction). For leases granted otherwise, the additional payment will be equal to the royalty payable for the mineral.
Included Minerals: Lessees must pay an additional amount as specified in the Eighth Schedule of the Mines and Minerals (Development and Regulation) Act, 1957, upon dispatch of the included mineral.

6. Enhanced Compliance Requirements

The amendment emphasizes compliance with the Mineral Conservation and Development Rules, 2017 for all included minerals. Lessees must maintain accurate accounts of minerals obtained, waste material excavated, and complete mine plans for both the existing leased area and the included area.

Impact of the Amendments

The Second Amendment Rules, 2026, aim to address several challenges in the mining sector, including:

Improved Transparency: The amendments introduce clear timelines and procedures for reporting discoveries, applying for mineral inclusion, and extending lease areas.
Efficient Resource Utilization: By allowing the inclusion of contiguous areas and other minerals, the amendments promote optimal utilization of mineral resources.
Enhanced Revenue Generation: The additional payment obligations ensure that the State Government benefits from the inclusion of new minerals or areas in mining leases.
Encouragement of Exploration: The requirement for preliminary exploration (G3 level) before granting leases for minor minerals ensures that resources are adequately assessed before extraction.

Conclusion

The Minerals (Other than Atomic and Hydro Carbons Energy Minerals) Concession (Second Amendment) Rules, 2026 mark a significant step forward in the regulation of India’s mining sector. By introducing provisions for the inclusion of contiguous areas and other minerals in existing leases, the amendments aim to enhance resource utilization, improve transparency, and boost revenue generation for the State Government. These changes are expected to streamline mining operations and encourage responsible exploration and extraction practices, contributing to the sustainable development of India’s mineral resources.

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Source: Ministry of Mines

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