Lok Sabha approved a Bill aimed at facilitating the tapping of India's offshore mineral resources. This amendment bill, associated with the Offshore Areas Mineral (Development and Regulation) Act of 2002, aims to establish a transparent and equitable mechanism for allocating operating rights to those involved in offshore mineral extraction.

Mines Minister Prahlad Joshi, while introducing the Bill, expressed his belief that it would resolve the on-going challenges in the sector.

The primary objectives of the Bill, as stated in its statement of objects and reasons, are to empower the central government to formulate rules for conserving and systematically developing minerals in offshore regions. Additionally, it strives to protect the environment by preventing and controlling pollution resulting from exploration or production activities.

Minister Joshi emphasised the urgency of introducing an auction-based method for allocating operating rights in offshore areas, ensuring a transparent and non-discretionary process for their allocation.

Moreover, the Bill proposes the establishment of an Offshore Areas Mineral Trust, similar to the District Mineral Fund, which will maintain a non-lapsable fund in the public account of India. This fund's purpose is to ensure sufficient financial resources for exploration, mitigating adverse impacts of offshore mining, disaster relief, research, and initiatives for the welfare of people affected by exploration or production operations.

Under this legislation, production leases will be granted to the private sector exclusively through auction, while operating rights in mineral-bearing areas can be allocated to public sector entities through a nomination process without competitive bidding.

Furthermore, the Bill introduces a composite license, a two-stage operating right that allows exploration followed by production operations. These composite licenses will also be granted only through auction by competitive bidding for the private sector.

Regarding atomic minerals, the grant of exploration licenses or production leases will be restricted to public sector entities exclusively.