Balance of Area Availability Auctions

In the first call for proposals, made available in September 2020, around 500 research areas were made available. The areas were for research into minerals used in civil construction, such as sand, clay, gravel and gravel, as shown in the figure below.

The distribution by state was concentrated in São Paulo (20%), Rio de Janeiro (11%), Minas Gerais (8%), Rio Grande do Sul (8%), Santa Catarina (8%), Goiás (7%), Paraná (7%), Bahia (6%) and Espirito Santo (6%), as can be seen in the graph below.

The distribution by state was concentrated in São Paulo (20%), Rio de Janeiro (11%), Minas Gerais (8%), Rio Grande do Sul (8%), Santa Catarina (8%), Goiás (7%), Paraná (7%), Bahia (6%) and Espirito Santo (6%), as can be seen in the graph below.

As a result of the Public Offer stage, 104 areas had only one interested party and therefore did not need to be contested. However, another 73 areas had more than one expression of interest and progressed to the Electronic Auction stage. In this last stage, 60 areas were auctioned off, while 13 were left unbid and unoccupied. All in all, the ANM raised around 1.9 million from this public notice.

For the second call for proposals, published in December 2020, around 6,700 areas were made available for research and 270 for mining concessions, involving various types of mineral substances.

In this public notice, the research areas were concentrated in the states of Bahia, Minas Gerais, Rio Grande do Sul and Goiás, as can be seen in the graph below.

The mining areas were concentrated in Santa Catarina, São Paulo, Goiás, Minas Gerais and Espirito Santo, corresponding mainly to granite, sand, clay, limestone, gravel, gneiss and mineral water. The graph below shows this scenario.

In this 2nd Round, 25 per cent of the areas were awarded in the Public Offer (1,713), 35 per cent of the areas went to the auction stage (2,415) and 40 per cent remained free (2,750). As a result of the auction, announced on 30/03/2021, 430 areas were not bid on, and the free areas were added to the total of 1,985. This round will end in August 2021, when payments for bids and exploration/leasing requirements will be finalised. The amount expected to be raised from this tender is more than 164 million.

For the third call for tenders, published on 31 March 2021, 2,762 areas were made available, 99 for mining and the rest for research. Expressions of interest can be made until 31 May.

The Midwest region accounts for 40% of the offers, followed by the Southeast (21%), South (19%), Northeast (17%) and North (3%). Among the areas for mining, there is a concentration of substances for ornamental stone and construction aggregates.

Area availability is a selection process conducted by the National Mining Agency (ANM) with the aim of selecting those interested in continuing mining projects that had previously been granted, but which have nevertheless been returned to the ANM's portfolio for reasons such as rejection of applications, expiry of titles, abandonment of the deposit or mine, withdrawal and resignation.

The New Mining Code Regulations (Decree No. 9.406 of 12 June 2018) brought with it several changes, including the availability of areas through this Public Offering and Electronic Auction system. Subsequently, Resolution no. 24 of 3 February 2020, of the ANM's Collegiate Board of Directors, regulated this procedure.

As such, it is moulded on Prior Public Offer notices made available by the ANM, followed by auctions when there are two or more interested parties, and is decided by the highest amount offered. Exceptionally, the tie-breaking procedure will use objective criteria of a technical, economic and social nature, at the ANM's discretion.

The competition for areas or blocks of areas is carried out exclusively on the electronic platform of the SOPLE Portal no documents, plans or projects are required during this process. In addition, the documentation and administrative processes must be digitised and sent to the ANM units.

To take part in the procedure to make areas available, you must be a Brazilian citizen or a company incorporated under Brazilian law and with its headquarters and administration in the country. In addition, the participant, an individual or their representative in the case of a legal entity, must be previously registered on the Digital Citizenship Platform, Single Login.

ANM employees, individuals or companies that are related to the employees or members of the Availability Procedure Commission (CPD) are not allowed to participate. In addition, persons convicted of environmental offences, legal entities in bankruptcy or extrajudicial recovery proceedings, and individuals with declared insolvency are also barred.

At the start of each round of areas, the public notice is published with the respective deadlines, minimum bidding rules and numbers of areas for expressions of interest. The procedure itself is made up of two parts: the Preliminary Public Offer and the Electronic Auction.

The first phase consists of the expression of interest on the SOPLE portal, within 60 days of the publication of the notice. The evaluation by the ANM will follow the procedures in the figure below.

After the ANM has analysed the results in accordance with the above procedures, they are published on the SOPLE Portal, listing the participants by name and registration number (CPF or CNPJ).

The second stage corresponds to the Electronic Auction, where the respective participants who have expressed an interest in the area will compete for the right to apply for the area. The SOPLE auction follows the procedures in the figure below.

Finally, once these procedures have been carried out and the bid has been paid, the research or mining application will be filed. Failure to pay the winning bid results in penalties, such as the loss of the right to prioritise the area, as well as a fine of R$1,000.00, or 10% of the value of the bid, as long as this amount does not exceed R$10,000.00. In addition, there is also a temporary suspension of participation in Area Availability procedures for 2 years.

This new system promises to bring several advantages, making the process increasingly agile. It also aims to develop the mining sector by reducing bureaucracy and distributing areas, generating jobs and income for the states.

In short, up until the second call for tenders, we had more than 3,800 areas awarded for research and mining. With this third call for tenders, a significant increase is expected, given the number of areas made available.

In general, the new system has met the expectations of optimising the distribution of areas and reducing bureaucracy. The decision, which sometimes took years, now takes months. However, it is important to monitor and verify the results in the long term, pointing out possible improvements.

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• Portal GOV: www.gov.br/anm/pt-br/acesso-a-informacao/participacao-social/audiencias-publicas/3a-rodada-da-disponibilidade-de-areas/pre-edital-da-rodada3.pdf/
• Investment Partnership Programme - PPI: www.ppi.gov.br/disponibilizacao-de-areas-para-pesquisa-e-lavra-mineral-anm
• William Freire: williamfreire.com.br/publicacoes/artigos/memorando-no-162021-disponibilidade-de-areas-2a-rodada/
• Jazida website: blog.jazida.com/disponibilidade-de-areas-leilao-anm/
• blog.jazida.com/resultado-leilao-2a-rodada-de-disponibilidade-de-areas-anm/