The Ministry of Mines (MoM) on January 23, 2026, issued the Draft Mineral (Auction) Second Amendment Rules, 2026, further to amend the Mineral (Auction) Rules, 2015.
The following has been stated namely: -
• The draft aims at streamlining auction processes, facilitating mining in forest-involved blocks, and digitising procedures. A key amendment provides for automatic issuance of the Letter of Intent (LoI) through an online unified mining portal upon receipt of upfront payment and performance security, eliminating manual issuance and making certain earlier sub-rules inapplicable.
• The draft also introduces flexibility where forest land is involved in a mineral block, allowing either exclusion of small forest portions (up to 20% of estimated resources) or execution of part mining leases for forest and non-forest areas separately, with a requirement that such part leases be amalgamated later and without any reduction in upfront payments.
• The amendments rationalise upfront payment provisions, prescribing that for blocks containing minerals other than those listed in Part D of the First Schedule or Seventh Schedule of the MMDR Act, the upfront payment shall be 1.5% of the estimated resource value, payable in three instalments and fully adjustable against auction premium upon commencement of production.
• Further, the draft removes fixed percentage references for certain instalments, enables automatic LoI issuance in additional scenarios upon receipt of performance security or upfront payments, and omits mineral-specific limitations in certain rules to broaden applicability.
• Overall, the amendments seek to enhance transparency, ease of doing business, and efficiency in mineral auctions while addressing challenges related to forest land and procedural delays.
• Comments/Suggestion to the draft rules may be sent via email at [email protected], by February 23, 2026.
[Notification no. - M.VI-16/6/2026-Mines VI]
