The Committee on Public Enterprises (COPE) has revealed that the government lost more than Rs. 12 million in royalty revenue from a single sand mining project due to lapses at the Geological Survey and Mines Bureau (GSMB). Lawmakers have directed the bureau to tighten monitoring and amend the Mines and Minerals Act to prevent further losses.
The shortfall was uncovered during COPE’s review of Auditor General’s reports for 2022 and 2023 and the bureau’s current performance, chaired by Dr. Nishantha Samaraweera, on Sept. 12 at Parliament.
According to the Auditor General, GSMB granted a private company a license to remove sand at the Mukkutoduwawa Estate in Puttalam District between December 2023 and September 2024. Although an estimated 36,531 to 45,561 cubic meters of sand were removed, royalties were collected for only 1,594 cubic meters, totaling Rs. 686,464. The Committee said the underreporting resulted in a loss of more than Rs. 12 million in state revenue.
COPE also questioned the current practice of calculating royalties for stone quarries based on the amount of explosives issued. Members noted that the system allows for unaccounted excavations, leading to large-scale revenue losses despite extensive quarrying nationwide.
The Committee further examined irregularities in the issuance of Exploration Licenses (ELs). Since 1993, more than 450 licenses have been issued, but only 43 remain active. COPE noted that many licenses are traded at higher prices without exploration work being carried out, while data submitted after exploration often lacks accuracy.
Concerns were also raised about mineral exploration in Mannar Island. Nine licenses had been issued to five Sri Lankan-registered companies, all linked to one Australian-based entity. However, no exploration has taken place for over a decade, blocking 195 square kilometers of land from other potential investors.
On rehabilitation of mined lands, COPE found that as of Aug. 11, 2025, no rehabilitation had been carried out for 3,150 licenses, despite deposits collected for that purpose. Officials said legal action was being pursued against defaulting license holders.
The Committee also highlighted suspected irregularities in quartz exports, including reports that clear quartz is being illegally exported with the support of insiders at GSMB. It recommended transferring the authority for clear quartz exports to the National Gem and Jewellery Authority.
COPE emphasized that the GSMB has historically failed to operate in line with the Mines and Minerals Act and underscored the need for systematic planning to maximize revenue potential. The Committee said it would continue monitoring the bureau’s implementation of recommendations.
Parliamentarians Dayasiri Jayasekara, Mujibur Rahman, Chaminda Wijesiri, Dilith Jayaweera, Prageeth Madhuranga, Jagath Manuwarna, Ruwan Mapalagama, Dharmapriya Wijesinghe, Asitha Niroshana Egoda Vithana and Chandima Hettiaratchi participated in the session, along with Ministry of Environment Secretary Rohitha Uduwawala, GSMB Chairman Saman Jayasinghe and other officials. (Newswire)
