(1) The preferred bidder shall submit a performance security in the manner specified in sub-rule (1) of rule 19H within fifteen days after being declared as preferred bidder, and upon receipt of such performance security, the State Government shall issue a letter of intent to the preferred bidder within fifteen days of receipt of performance security:
Provided that the State Government may, for the reasons to be recorded in writing, extend the period of fifteen days for submission of performance security by further fifteen days.
(2) In case the preferred bidder fails to submit the performance security within the period or extended period specified in sub-rule (1), the State Government shall,—
(a) forfeit the bid security of the preferred bidder; and
(b) offer the bidder who had submitted second-lowest price offer in the second round of auction to meet the lowest final price offer and if the said bidder agree to the said offer in writing and submit the performance security within fifteen days of receipt of offer, the State Government shall declare the said bidder as the preferred bidder and issue letter of intent to him:
Provided that the State Government may, for the reasons to be recorded in writing, extend the period of fifteen days by further fifteen days.
(3) On receipt of the letter of intent the preferred bidder shall be considered to be the successful bidder upon fulfilment of the following conditions, namely:—
(a) compliance with all the terms and conditions of eligibility;
(b) obtaining all consents, approvals, permits, no-objections and the like as may be required under applicable laws for commencement of reconnaissance or prospecting operations or both; and
(c) submitting the scheme of reconnaissance or prospecting or both in accordance with the Mineral Conservation and Development Rules, 2017.
(4) Upon fulfilment of the conditions specified in sub-rule (3), the State Government shall grant an exploration licence to the successful bidder and such exploration licence shall be subject to the provisions of the Act and the rules made thereunder.
Provided that on expiry of a period of one year from the date of the letter of intent, no exploration licence deed shall be executed and the letter of intent shall be invalidated leading to annulment of the entire process of auction:
Provided further that the State Government may allow a further period of six months for execution of the exploration licence deed, if the reasons for delay were beyond the control of the preferred bidder.
(5) The exploration licencee shall conduct geological exploration (reconnaissance or prospecting operations or both) of the area under the exploration licence so as to ascertain evidence of mineral contents and shall submit periodic reports in accordance with the Act and rules made thereunder, and all reports, studies and other documentation related to the geological exploration of the area under the exploration licence shall be submitted to the State Government with its copy to the Indian Bureau of Mines.
(6) Period of exploration licence shall be in accordance with sub-section (10) of section 10BA.
20 THE GAZETTE OF INDIA : EXTRAORDINARY [PART II—SEC. 3(i)]
(7) The exploration licencee may, at any time, surrender a part or the entire area to the State Government, subject to the conditions specified in rule 9B of the Minerals (Other than Atomic and Hydro Carbons Energy Minerals) Concession Rules, 2016:
Provided that after three years from the date of execution of the exploration licence, the exploration licencee may retain an area not exceeding twenty-five per cent. of the total area covered under that licence for the purpose of continuing reconnaissance or prospecting operations and shall surrender the remaining area after submitting a report to the State Government stating the reasons for retention of the area proposed to be retained by him and the boundaries of that area.
(8) If an exploration licencee,—
(a) fails to complete reconnaissance and prospecting operations within the period permitted under sub-section (10) of section 10BA; or fails to establish the existence of mineral contents as specified in rule 5 of the Minerals (Evidence of Mineral Contents) Rules, 2015 for grant of mining lease and submit the geological report within the period specified under sub-section (12) of section 10BA, such licencee shall not be eligible to receive any share out of the auction premium of the mining lease granted in the area covered by his exploration licence and the State Government may take any action as it deems fit, including imposition of penalty in form of appropriation of performance security;
(b) completes reconnaissance and prospecting operations within the period permitted under sub-section (10) of section 10BA and submits to the State Government and the Indian Bureau of Mines the result of the prospecting operations in the form of a geological report prepared in accordance with rule 5 of the Mineral (Evidence of Mineral Contents) Rules, 2015; identifying the area suitable for grant of a mining lease within the period specified under sub-section (12) of section 10BA, then such licencee shall be entitled to receive the percentage share in auction premium of the mining lease in accordance with these rules.
(9) Exploration licencee shall prepare separate geological report for each block identified for grant mining lease under sub-rule (8).