INDUSTRIES DEPARTMENT

MINES AND MINERALS

POLICY NOTE
2022 - 2023

DEMAND No. 27

DURAIMURUGAN
Minister For Water Resources

©
GOVERNMENT OF TAMIL NADU
2022
Printed by Govt. Central Press, Chennai - 600 001.
 INDUSTRIES DEPARTMENT

MINES AND MINERALS

POLICY NOTE

2022–2023

CONTENTS

Sl.
Title Pages
No.
1. Department of Geology and
Mining 1-42

2. Tamil Nadu Minerals Limited 43-50

3. Tamil Nadu Magnesite Limited 51-57

 INDUSTRIES DEPARTMENT

MINES AND MINERALS

POLICY NOTE

2022-2023

1. DEPARTMENT OF GEOLOGY AND MINING

Minerals form the basic resources for

several important industries and contribute
substantially to the economy and to industrial
growth. The developmental activities of the State
and its economic prosperity are reflected by the
availability of mineral wealth and its prudent and
sustainable utilization.

Since, mineral resources are

non-replenishable, it is imperative that the
minerals should be scientifically mined and
utilized with due emphasis on their conservation
for posterity and as common resources, ensuring
appropriate flow of revenue to the public
exchequer.
 Tamil Nadu is endowed with several
industrial minerals like Lignite, Limestone, Garnet
Sand, Silica Sand, Quartz and Feldspar, Graphite,
Oil and Natural Gas, Magnesite, Iron Ore, etc.,
and also minor minerals including Black and
Multi-Coloured Granite and common use minerals
like rough stone etc.

District Survey Reports were prepared in all

the districts and hosted on the district websites.
The survey reports contain holistic information on
minerals available in the district and would be
useful for entrepreneurs for applying mining
leases and for development of minerals.

For the welfare of the people in the areas

affected due to mining activities, the Government
is implementing a plethora of projects through the
District Mineral Foundation Trust Fund in the
sectors of infrastructure, education, drinking
water, health, sanitation, welfare of the aged and

2
differently abled people, welfare of women and
children, skill development, environment and
pollution control and irrigation. A total of 2454
projects have been taken up at a cost of
Rs.709.04 crore upto March, 2022.

The clandestine mining and transportation

of minerals is a big challenge to the society. To
stem this menace depriving the State from the
revenue due to it, the Government has taken a
series of stern measures, such as deployment of
Drone technology, Mining Surveillance System,
flying squads, etc.

Due to the concerted efforts of the State

Government to act against illicit mining, the
revenue from mineral resources, has gone up
significantly from Rs.983 crore in 2020-21 to
Rs.1179.21 crore upto March, 2022.

Exploration agencies including the

Geological Survey of India (GSI), Mineral

3
Exploration Corporation Ltd., (MECL) and
Kudremukh Iron Ore Corporation Limited (KIOCL)
have submitted reports on availability of
Limestone, Dunite, Iron ore, Graphite, Platinum
Group of Elements (PGE), and Molybdenum.

Eight limestone mineral blocks and five

composite license blocks to auction for the first
time as per the provisions of Mines and Minerals
(Development and Regulation) Amendment Act,
2015 is under process and the Government will
get substantive revenue from the upfront
payment to be received from the successful
bidders.

This Government is also taking steps to

bring the Granite bearing Government lands for
auction to revive the Granite industries in the
State.

4
1.1 Vision and Mission
The vision of this department is “to
consolidate the leadership position of Tamil Nadu
in the management of the mineral wealth” and
the mission is “To undertake / facilitate scientific
exploration, optimal exploitation, judicious
conservation and revenue maximization in
industry, eco and a citizen friendly policy
framework.”
1.2 The Objectives
i. Use of modern technologies in the
exploration and mining of minerals in an
eco-friendly basis.

ii. Augmentation of revenue through effective

and efficient administration of mineral
wealth.

iii. Generation of employment opportunities.

iv. Prevention of illegal mining and

transportation of minerals through

5
 appropriate technological measures and
through stringent action.

v. Implementation of projects in the sectors

of drinking water, health, welfare of
women and child care, infrastructure,
welfare of aged and differently abled,
sanitation, environmental and pollution
control, skill development, irrigation,
watershed management for the welfare of
the society in the mine affected area using
District Mineral Foundation Trust Fund.

1.3 Functions

i. The Department has been carrying out

exploration of new mineral deposits with
the aid of the Geological Survey of India
(GSI) and notified agencies such as
Mineral Exploration Corporation Limited
(MECL), Kudremukh Iron Ore Corporation
Limited (KIOCL), Tamil Nadu Cements

6
 Corporation Limited (TANCEM), Tamil
Nadu Magnesite Limited (TANMAG) and
Tamil Nadu Minerals Ltd (TAMIN).

ii. Mineral Concessions are granted to public

sector undertakings such as TAMIN,
TANCEM, TANMAG, Neyveli Lignite
Corporation India Limited (NLCIL), Indian
Rare Earths (India) Limited and to private
sector entities for the development of
minerals. For this, royalty, surface right
compensation and dead rent are being
collected from the lessees of major
minerals; seigniorage fee, dead rent, area
assessment and annual brick mineral fee
are being garnered from the lessees of
minor minerals.

iii. For effective control on the clandestine

mining of minerals and its transportation,
flying squads operating in Salem,

7
 Villupuram, Tiruchirapalli and Madurai
regions are routinely checking the mining
areas and the vehicles transporting
minerals.

iv. The hill areas in Kodaikanal of Dindigul

district and the Nilgiris district are prone to
landslides triggered by rainfall during the
monsoon. Geotechnical Cells in these
districts have been mapping the hilly areas
for identification of weak zones susceptible
to landslides. The Geotechnical Cells
suggest remedial measures to the district
administration to mitigate natural hazards.
The Geotechnical Cells are also process
applications made by individuals and
Government bodies and after examining
the safety and suitability of the areas,
offer technical feasibility assessment
reports for construction activity in the hill
areas.
8
1.4 Details of Major and Minor Mineral
Leases under operation are as follows:

No. of Leases Extent

Mineral
under operation (in Ha)
I. Major Minerals
1.Oil and Natural Gas 13 24378.00.0
2.Lignite 1 25900.00.0
3.Limestone 57 3380.96.0
4.Magnesite 2 80.28.5
5.Vermiculite 1 23.70.5
6. Graphite 1 237.39.5
7.Beach Sand Minerals 2 148.28.7
Sub Total 77 54148.63.2
II. Minor Minerals
1.Multicoloured Granite 83 184.52.2
2.Black Granite 27 151.94.4
3.Roughstone 1353 2646.07.1
4.Gravel 45 101.27.6
5.Earth 20 69.09.7
6.Pebbles 4 5.50.5
7.Quartz and Feldspar 13 25.24.6
8.Limekankar 7 711.18.9
9.Fireclay 5 17.31.0
10.Silica Sand 1 2.77.0
11.Calcite 1 1.94.5
Sub Total 1559 3916.87.5
Grand Total 1636 58065.50.7

9
1.5 Mineral Resources, Production and
Revenue
Tamil Nadu is endowed with major minerals,
minor minerals and oil and Natural Gas. These
minerals are detailed below:

(A) Major minerals

(i) Limestone
It is used in
manufacturing lime,
cement, chemicals,
fertilizers and in
metallurgical industries. It is of two types,
a) Crystalline Limestone, which mainly
occurs in Salem, Tiruchirapalli, Karur,
Dindigul, Madurai, Virudhunagar,
Coimbatore and Kanniyakumari districts.
The reserves of crystalline limestone is
estimated to be 200 million tonnes.

10
 (b) Non-Crystalline
Limestone or Fossiliferous
Limestone: It occurs
predominantly in Ariyalur,
Tiruchirapalli, Perambalur and Thoothukudi
districts. The reserves of Fossiliferous
Limestone is estimated as 670 million
tonnes. 57 leases are under operation over
an extent of 3380.96.0 ha.

(ii) Marl

This Mineral is used in manufacturing

of Cement and Fertilizers.
It occurs as a sedimentary
deposit in association with
Fossiliferous Limestone in
Ariyalur District. Marl is being Mined with
5 existing Limestone leases over an extent
of 174.38.0 hectares in Ariyalur district.

11
(iii) Molybdenum
The MECL has identified economically
viable deposit of Molybdenum in the
districts of Krishnagiri and Dharmapuri. The
reserves of Molybdenum is estimated as
0.699 million ton in Krishnagiri district and
8.350 million tonne in Dharmapuri district.
The Government of India has conveyed the
market price of Molybdenum. The rate of
royalty has been received from the Ministry
of Mines. This blocks will be brought to
auction for developing this strategic
mineral.
(iv) Bauxite
The metal Aluminium is extracted
from this ore. Bauxite is
also used in refractory,
cement, chemical, paint
industries and for
refining petroleum products. The Shervaroy
12
hills in Salem district and Kolli hills in
Namakkal district contain good deposits of
Bauxite. Five leases have been granted
over an extent of 421.04.2 ha.
(v) Magnesite
It is a magnesium carbonate mineral.
It finds wide use in refractories as flux in
sintering, blast furnace,
conditioners, ceramic
filters and abrasives. One
of the World’s best magnesite deposits
occurs in the Chalk hills of Salem district.
The reserves of Magnesite are estimated as
40.5 million tonnes. 2 leases are under
operation over an extent of 80.28.5 ha.

(vi) Graphite
It is a naturally
occurring crystalline
Carbon used in the
crucible industry and also used in insulators,
13
electrode, atomic reactors and foundry
units. Graphite occurs mainly in Sivaganga
and Madurai districts. One lease granted to
Tvl. TAMIN Limited over an extent of
237.39.5 ha is in operation in Poovandhi
village of Sivaganga district.

(vii) Vermiculite
It is a micaceous
mineral, which appears
brownish yellow in
colour. It is used as
insulators and in manufacture of vermitiles.
TAMIN is mining this mineral over an extent
of 23.70.5 ha in Sevathur village, Tirupattur
district.
(viii) Lignite
This energy
mineral is found in three
areas namely Neyveli,

14
Mannargudi and Ramanathapuram. The
total reserves of Lignite in these areas is
estimated at 34,764 million tonnes. The
Neyveli Lignite Corporation India Limited
(NLCIL) has been mining Lignite in Neyveli
over an extent of 25,900 ha in Cuddalore
district.

(ix) Atomic Minerals

Beach sands in Tirunelveli,
Thoothukudi and Kanniyakumari districts
contain atomic minerals such as Monazite,
Garnet, Ilmenite, Rutile, Sillimanite, Zircon
and Leucoxene. Beach sand minerals are
used as abrasives, semiconductors and in
atomic reactors. The Indian Rare Earths
(India) Limited (IREL) has been mining
these minerals in Kanniyakumari district.
Garnet also occurs as placer deposits in
Tiruchirapalli district and as rock forming
deposits in Madurai district.
15
 Ilmenite Zircon Monazite

Rutile Garnet Sillimanite

The Union Government, Ministry of

Mines vide order dated 01.03.2019 notified
that the threshold value of monazite
occurring in beach sand minerals and other
placer deposits is fixed as 0.00%.
Henceforth, any mineral concession of
beach sand minerals shall be granted only
to a “Government Company or Corporation
owned or controlled by the Government”
under the provisions of the Atomic Minerals
16
 Concession Rules, 2016. 2 leases are under
operation over an extent of 148.28.7 ha by
IREL.

(B) Minor minerals

(i) Granite
Tamil Nadu contains rich deposits of
Granite. The hard crystalline rocks that are
amenable to cutting
and polishing are
called Granite. The
quarrying of Granite
in India was pioneered by Tamil Nadu in
1970s.
Granite which is produced in different
sizes such as monuments and tiles has huge
market in the foreign
countries, earning
substantial foreign
exchange. Black Granite
occurs in the districts of Krishnagiri,
17
Dharmapuri, Salem, Villupuram and
Tiruvannamalai. Granites of various shades
occur in the districts of Krishnagiri, Madurai,
Virudhunagar, Salem and Dindigul. Some of
the most popular commercial varieties
quarried in Tamil Nadu are Kunnam black,
Zebra white, Paradiso, Red wave, Tiger
skin, Desert brown and Kashmir white. A
total of 27 black granite and 83
multicoloured granite quarries over an
extent of 336.46.6 ha are under operation
in Tamil Nadu.
(ii) Gypsum
Gypsum is used in the manufacture of
Plaster of Paris and also in industries such
as cement, fertilizer and
pesticides. A total of
16.46.0 ha of land in
Coimbatore, Perambalur

18
and Tiruppur districts have been leased out
for mining Gypsum.

(iii) Fire Clay

The main use of
fire clay is in refractory,
ceramic articles, cement
industries and as
decorative tiles. It is found in the districts
of Ariyalur, Perambalur and Cuddalore. 5
leases are in operation over an extent
of 17.31.0 ha.
(iv) Soapstone
It occurs mainly in the districts of
Salem and Namakkal. It is used in the
manufacture of talcum
powder and decorative
articles. Leases have
been granted for mining
Soapstone over an extent of 3.28.5 ha in
Salem and Namakkal districts.
19
(v) Quartz and Feldspar
The districts of Salem, Karur,
Dindigul, Namakkal,
Tiruppur and Dharmapuri
have good deposits of
Quartz and Feldspar. It is mainly used in
glass, refractory, foundry, ceramic,
electrical, abrasives and
paint industries. 13 leases
over an extent of
25.24.6 ha are under operation in the above
districts for mining these minerals.

(vi) Silica Sand

It is mainly used in glass industries
and in foundaries as
moulding catalysts.
It occurs in the
districts of Villupuram,

20
 Nagapattinam, Chengalpet and Cuddalore.
One quarry over an extent of 2.77.0 ha is
under operation in Chengelpet district.

(C) Mineral oils

Petroleum and Natural Gas
The Oil and Natural Gas
Corporation (ONGC) has
been producing Oil and

Natural Gas in the districts of

Cuddalore, Thanjavur,
Tiruvarur, Nagapattinam,
Pudukottai, Mayiladuthurai, Ariyalur and
Ramanathapuram.

(D) Mineral Production

In Tamil Nadu, the details of production of
major minerals including oil and natural gas and
minor minerals from April 2021 to March 2022
are tabulated below:

21
 (i) Production of major minerals

Production Revenue
Sl.
Mineral (in Metric (Rs. in
No.
Tonne) crore)
1 Lignite 2,36,26,296 296.00
2 Limestone 2,04,56,860 171.52
3 Magnesite 48,349 0.62
4 Vermiculite 670 0.01
5 Graphite 49,233 0.12
6 Marl 6,30,141 4.23
7 Garnet 3,952 0.24
8 Ilmenite 60,154 2.63
9 Rutile 1,959 0.45
10 Zircon 4,328 0.97
11 Monazite 2,030 0.02
TOTAL 4,48,83,972 476.81

(ii) Production of Oil and Natural Gas

Sl. Revenue
Mineral Production
No. (Rs. in crore)
1 Crude Oil 3,66,319 MT 223.41
2 Natural
101,91,92,017 cbm 66.54
Gas
Total 289.95

22
 (iii) Production of minor minerals

Production Revenue
Sl. No. Mineral
(Rs.in crore)
1 Coloured Granite (cbm) 1,03,970 22.93
2 Black Granite (cbm) 21,064 9.01
3 Rough Stone (cbm) 3,99,81,625 212.47
4 Gravel (cbm) 58,84,820 23.91
5 Earth (cbm) 24,84,349 16.21
6 Pebbles (cbm) 14,946 0.40
7 Quartz (MT) 14,323 0.25
8 Feldspar (MT) 73,330 0.73
9 Silica Sand (MT) 2,900 0.04
10 Lime Kankar (MT) 2,56,930 2.18
11 Fire clay (MT) 2,54,370 0.78
12 Calcite (MT) 1,890 0.01
13 Quartzite 225 0.002
14 Clay(MT) 35,000 0.07
Total 4,91,29,742 288.99

(E) Mineral Revenue

The revenue generated from the mineral
resources during the financial year 2020-21 was
Rs.983 crore. During the current financial year
2021-22, the revenue generated is

23
Rs.1179.21 crore. The share of revenue from
major minerals, minor minerals and oil minerals is
shown below.

The revenue realization for the last six

financial years is shown below:

Due to effective enforcement during this

financial year till March 2022, 9,363 vehicles
transporting minerals without valid transport
24
permits were seized. A penalty of Rs.1.13 crore
was levied and collected. In addition, 6,806
criminal cases / FIRs have been filed. Goondas
Act has been invoked against 19 habitual
offenders.

1.6 National Mineral Exploration Trust

The National Mineral Exploration Trust was
established in 2015. The lessees of major
minerals have been contributing 2% on royalty to
this Trust. A sum of Rs.66.15 crore has been
contributed by them to the Trust for the period till
31.03.2022.

This fund is invested

for exploration of minerals
regionally and particularly
for strategic and critical
minerals, development of mineral resources,
extraction of minerals by adopting modern
scientific and technological methods, facilitate

25
geophysical, geochemical, aerial geo-survey of
mineral potential areas and to organize capacity
building programs.

Exploration of Limestone in 5 blocks over an

extent of 655 ha in Ariyalur district has been
taken up at a cost of Rs.6.55 crore in 2019. The
MECL explored Limestone in 4 blocks and KIOCL
in 3 blocks and have submitted their reports. The
Geological Survey of India has identified one
limestone block and submitted the report.
Auction process for eight limestone blocks is
under progress.

The Geological Survey of India has handed

over four limestone blocks and one graphite block
under G4 level. Auction process to bring the
composite licenses for the said five blocks is
under progress.

26
1.7 District Mineral Foundation Trust

The District Mineral Foundation Trust was

established in all the districts except Chennai and
Nilgiris in 2017. The public sector undertakings
and private companies granted with leases for
mining and quarrying of minerals before
12.01.2015 have been contributing 30% on
royalty or seigniorage fee and lessees granted
leases after this period are contributing 10% on
royalty (or) seigniorage fee to the Trust. This fund
is utilized for the implementation of the Pradhan
Mantri Khanij Kshetra Kalyan Yojana (PMKKKY)
and other welfare schemes for areas and people
of the mine affected areas. A sum of
Rs.1027.29 crore has been contributed by the
lessees from the period of establishment of this
Trust since 2017 till 31.03.2022

A minimum of 60% of the fund is

earmarked for taking up projects under the high

27
priority sectors such as health care, drinking
water, education, welfare of women and children,
welfare of aged and differently abled people, skill
development, infrastructure, sanitation,
environmental preservation and measures to
control pollution.

The remaining fund is used for projects that

fall under other priority sectors such as irrigation
development, energy and watershed
development, environmental preservation and
pollution control measures.

A total of 2,454 projects have been taken

upto 31.03.2022 at a cost of Rs.709.04 crore. Out
of these projects, 1,635 projects have been
completed and put into use. The number and cost of
projects that are taken up under high priority and
other priority sectors are shown in the table.

28
(i) Projects under High Priority Sectors
Sanctioned
Sl. No of
Sectors Amount
No. projects
(in crore)
1 Infrastructure 641 160.42
2 Health 557 59.00
3 Drinking Water 424 264.02
4 Education 366 30.24
5 Sanitation 159 11.15
Welfare of aged and
6 106 1.44
differently abled people
Welfare of Women and
7 62 5.38
Children
8 Skill Development 22 2.89
Environment, Pollution
9 20 4.89
Control and Ecology
Total 2,357 539.43

29
 (ii) Projects under Other Sectors

Sanctioned
Sl. No of
Sectors Amount
No. projects
in Crore
1 Irrigation 44 154.52
2 Energy and watershed 41 12.36
development
3 Others 12 2.73
Total 97 169.61
Grand Total 2,454 709.04

30
1.8 Initiatives
1.8.1 Establishment of Green Fund

In the Government Order dated 23.02.2022,

the Government have inserted a new Rule 35-A in
Tamil Nadu Minor Mineral Concession Rules, 1959
for establishment of a Green Fund in each district
for reclamation, restoration, and rehabilitation of
abandoned quarries / mines. The prospecting
license / lease holder of any mineral shall, in
addition to seigniorage
fee contribute to the
Green Fund of the
district in which mining /
quarry operations are to
be done, an amount at
the rate of 10% of seigniorage fee and if the
minerals are to be transported outside the State,
shall pay 20% of the seigniorage fee. An amount of
Rs. 21.73 lakhs have been collected under Green
Fund up to 31.03.2022.

31
1.8.2 Restoration of 436 old abandoned
mines and quarries for public utility
As per the announcement of the Hon’ble
Minister for Water Resources during the year
2021 all the District Collectors have been
addressed to bring the 436 identified abandoned
mines / quarries for public utility such as rain
water harvesting structures in coordination with
the Tamil Nadu Water Supply and Drainage Board
and Local Bodies.

1.8.3 Preventing illicit mining / quarrying

through Drone Technology
The Department will now utilize the Drone
Technology to prevent illicit mining in all the
districts at an
estimated recurring
cost of Rs.25 Crore.
To keep a vigil on
excess mining in the
leased-out areas and
mining of minerals outside the leased boundaries,
32
drone technology is deployed for assessing the
quantum of minerals removed for recovering the
cost of minerals from the lessees and invoking penal
action against them.

In this regard, the Government has already

sanctioned an amount of Rs.50 lakh during the
year 2020-21. In the first phase, as per the MOU
signed with the Anna University, Drone
Technology was utilized in Theni district for
surveying 54 stone quarries for assessment of
quantum of minerals excavated and transported.
This technology is proposed to be extended all
over the State, wherein the quantum mined will
be measured twice a year and the revenue due to
the Government will be collected without any
delay.

33
1.8.4 Protection of Ancient Monuments,
Tamil inscriptions, Samanar Padukai
and Archaeological sites
The Government have amended the
provisions of the Tamil Nadu Minor Mineral
concession Rules, 1959 by fixing 500m radial
distance from the boundaries of an archeological
site or remains and
ancient monument
and one kilometer
radial distance from
the boundaries of
National Parks, Wild Life Sanctuaries, Tiger
Reserves, Elephant Corridors and Reserve Forests or
the protective distance as notified by the Ministry of
Environment, Forest and Climate Change,
Government of India from time to time, whichever
is more. This will pave way for protection of Ancient
Monuments, Tamil Inscriptions, Samanar Padukai
and all Archeological sites of Tamil Nadu from
extensive mining.
34
1.8.5 Augmenting Revenue by disposing the
Granite Waste in quarries
The waste granite generated during the
quarry operations are dumped and stocked at the
quarry site without any usage for the long period
which are exposed to various climatic condition
resulting in quality degradation. There is a huge
demand for granite waste for production of
M-Sand, road metals and other purposes.

Granite wastes may be disposed for M-sand

productions and other various usages after due
amendment in the existing rules by fixing the
seigniorage fee on tonnage basis, thereby the
Government will get substantial revenue from the
above sources. In this regard, amendment in the
Tamil Nadu Minor Mineral Concession Rules, 1959
for disposing the granite waste will be issued
shortly.

35
1.8.6 Formulation of sustainable mining
policy and M-sand policy
The Department of Geology and Mining has
proposed to formulate a sustainable mining policy
to ensure that the mining activity is carried out
without affecting the environment and Ecology.
It is also proposed to formulate a policy to
regulate M-sand in the State.

1.8.7 Establishment of Fossil Geological

Parks at Ariyalur and Perambalur
It is proposed to establish a Geo-heritage
Park in 495.60.0 ha at Perambalur District and
4.01.5 ha of
Government lands
in Ariyalur District.
The badland
topography with
series of conical hills separated by valleys is called
“Karai” formation in Karai village of Perambalur
district with unique lithology and diversity of

36
extinct marine life. These formations consist of
pockets of phosphatic nodules and fossils like
Ammonites, Nautilus, Beleminites, etc. It attracts
a large number of scientists from all over the
world for geo-scientific studies. Its protection and
preservation will not only help in creating interest
about life through ages of Mother Earth in the
minds of common man, but also provides
possibility of unravelling the paleo-geographic and
paleo-environment of the area. In order to
establish Fossil Park to protect these Fossils,
preparation of Detailed Project Report is in final
stage.

37
38
Combined Water Supply Scheme for 9 Panchayats in Panruti and Annagramam Unions of Cuddalore
Districts at the cost of Rs.9.21 crore implemented from DMFT Fund

39

1
Blank page

40
40
Construction of Primary Health Center at Karmangudi Village of Srimushnam Taluk in Cuddalore District
at the cost of Rs.80 lakh
41