Mining Permit System

The other widespread system of land tenure is the permit system. In this scheme, the government controls the mineral rights and licenses the prospector to explore a certain area, The permit — also called the concession, license, or contract area, expires after a specified period; usually the prospector can renew the permit but must drop part of the area it covers. This provision ensures that the holder works continuously on exploration in order to know which parts of his contract area to keep at the next renewal. The exploration permit may also specify minimum amounts of work that must be done, or money that must be spent, on the area to keep the mineral rights.

The claim system, because it allows prospectors to stake open ground without requiring applications or prior agreements, rewards companies and individuals that move quickly to pick up mining rights. The permit system’s requirement for a formal exploration agreement rewards large groups with the backing to carry out the plans.

Both the claim system and the permit system give the holder the exclusive right to explore and develop an area. To keep that right the holder is required to perform work; if the work is not done, the ground falls open for someone else.

It is also usual that holders of mining property must submit technical reports to the government as proof that the exploration work has been done. The reports are opened to the public and become useful information for future prospectors.