Tepid interest for Brazilian auction of mining areas

The auction of five mining areas, conducted by Brazilian geological service SGB this week, attracted tepid interest, with no bids made for three areas of the areas offered. 

The Natividade gold project in Tocantins state, the Santo Inácio diamond project in Bahia state and Capim river kaolin project in Pará state failed to attract offers and the SGB will look into holding a new bidding process for them, it said in a statement.

Meanwhile, local company Gesso Integral won the auction for the Agrominerais Aveiro asset, in Pará state.

The firm made the winning bid ahead of five other proposals and will assume mining rights for resources of an estimated 326Mt of gypsum and 588mt of limestone. 

Its bid for Aveiro included offering the government 25.5% of the monthly gross revenue from the minerals mined as a production bonus. In addition, it will pay a 5mn-real (US$1mn) one-time fee to the federal administration.

The Miriri phosphate project, in areas of Paraíba and Pernambuco states, received a single bid from an unnamed company. "However, there were pending issues in the documentation and the special bidding committee (CEL) gave five days for [the firm] to regularize them," the SGB said in a statement. 

The bidding process was the first in the sector conducted by the administration of President Luiz Inácio Lula da Silva after taking office in January 2023. Auctions of mining areas were common under the government of president Jair Bolsonaro (2019-22).