Auctioning mining rights is the biggest structural change the Law on Geology and Minerals 54/2024/QH15 brings to the sector: in areas with approved exploration results, the extraction right must in principle pass through competitive auction rather than file-based designation. For investors, this changes mine strategy itself — from ‘apply as early as possible’ to ‘identify the area, understand the auction mechanism, and price the reserves before the auction opens’.
Which areas are auctioned, and which are not
The 2024 law’s principle is auction of mining rights in areas with approved mineral exploration results, allocating extraction rights competitively and raising state revenue through the grant-fee rate formed at auction. Alongside that principle, the law keeps prescribed non-auction cases — such as areas without exploration results where an organisation proposes to explore, and special-purpose cases decided by competent authorities. A company must therefore determine which group its target area falls into before any planning: misreading the auction status means misreading the project’s entire route and budget.
How the auction connects to the grant fee
In an auctioned area, the collection rate (R) in the grant-fee formula of Decree 193/2025/ND-CP is precisely the rate formed at the auction, replacing the appendix rate used for non-auctioned areas. The consequence is that an auction-won mine’s grant fee can sit materially above the standard level — a real cost of the extraction right that must enter the financial model before a bid ceiling is set. The auction winner must still complete ordinary exploitation licensing afterwards; winning the auction grants the right to be considered for licensing, it does not replace the licence.
Licence term and extension
The exploitation licence term is set in line with the investment project and the mine’s licensed reserves — larger reserves carry correspondingly longer licence lives — and extension is considered where reserves remain unextracted and the company has fully performed its duties throughout the extraction period. An extension file is therefore more than an application form: it is a compliance summary covering grant fees, resource tax, progressive rehabilitation and occupational safety. Companies that let duties pile up to the final licence year often find their extension file suspended at the very moment they need it most.
Strategy for investors under the auction regime
Three capabilities decide success under the new regime: geological data skill (reading and valuing exploration results of areas coming to auction), valuation discipline (a maximum bid computed from a financial model that already includes grant fees at the expected auction rate), and speed in completing procedures after winning. The largest risk is the winner’s curse — bidding on competitive emotion until the project no longer works at the locked grant-fee level. The investor with a lasting edge builds a target-area portfolio and tracks provincial auction calendars as a standing investment process.
Frequently Asked Questions
Must mining rights always be auctioned?
In principle, extraction rights in areas with approved exploration results must go through auction under the Law on Geology and Minerals 54/2024/QH15. The law keeps prescribed non-auction cases, such as areas without exploration results proposed for exploration by an organisation. Determine the specific area’s status before building the project route.
How does the grant fee differ in an auctioned area?
In an auctioned area, the collection rate in the Decree 193/2025/ND-CP formula is the rate formed at the auction, replacing the appendix rate for non-auctioned areas. The grant fee can therefore exceed standard levels and must be included in the financial model before the company sets its bid.
How long does an exploitation licence last, and can it be extended?
The term tracks the investment project and the mine’s licensed reserves. Extension is considered where reserves remain and the company has fully performed its financial, environmental and safety duties during extraction — a clean compliance record is the practical condition for extension.
This article has been quality-reviewed by the FLAW AI Legal Council