Minerals Option/Lease Process (excluding Mines Royal)
The Crown Estate owns onshore land and mineral rights throughout England and Wales.
Wardell Armstrong is Mineral Agent for the Crown Estate and manages the onshore minerals portfolio and related procedures and processes. This note sets out the steps for awarding options and leases for mineral sites in England and Wales. A separate note is available in respect of applications for Mines Royal Options.
The Option/Lease Process
Companies wishing to take an option or lease for onshore mineral extraction purposes are invited to contact Wardell Armstrong to discuss their proposals. The applicant company will be asked to submit information supporting its proposals including but not limited to: financial standing and experience of the company, environmental credentials and track record, potential marketing outlets for the mineral, operational and restoration proposals, and timescales for progressing its proposals. The Crown Estate also requires that its legal and mineral agent’s fees for each option/lease are paid by the applicant company.
Where other property interests are required to deliver a mineral site (e.g. where surface access rights are required), the applicant company should also demonstrate the steps it has taken to secure those interests.
For greenfield sites, the Crown Estate will usually grant an exclusive option to take a lease, which will normally be conditional upon the grant of a satisfactory planning permission for mineral extraction. Options will usually be granted for a maximum duration of 10 years. A draft lease will be attached to the option, but some changes may be required prior to accommodate individual site circumstances.
Where satisfactory planning permission for mineral extraction already exists or a site is already operational, the Crown Estate will usually grant a lease.
Option and lease terms will be subject to private negotiation and will reflect relevant commercial market circumstances having regard to location, scale, operational life, and nature of the proposed mineral to be extracted. Where the Crown Estate considers best value would be obtained through seeking competitive bids, Wardell Armstrong may invite site specific offers from appropriate companies through a formal tender process.
If minerals remain unworked at the end of a lease or if there is potential to extend an existing mineral operation from or into Crown Estate land, and where the incumbent tenant has demonstrated satisfactory performance, that company will normally be invited to apply for a new lease.