Plans to expand the Dendrobium metallurgical coal mine have been knocked back in a decision by the Independent Planning Commission.
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The South32 mine had proposed to extend areas five and six of their mining operations in Macarthur, which neighbour Cordeaux Dam.
The IPC found the 'adverse impacts on the environment [were] high and that those impacts [were] not appropriately manageable and [were] likely to be irreversible'.
"After careful examination of all the evidence and weighing all relevant considerations, the commission has found that the longwall mine design put forward by South32 does not achieve a balance between maximising the recovery of a coal resource of state significance and managing, minimising or mitigating the impacts on the water resources and biodiversity and other environmental values of the Metropolitan Special Area," the Commission's Statement of Reasons for Decision reads.
"The level of risk posed by the project has not been properly quantified and based on the potential for long-term and irreversible impacts - particularly on the integrity of a vital drinking water source for the Macarthur and Illawarra regions, the Wollondilly Shire and Metropolitan Sydney - it is not in the public interest."
Georges River Environmental Alliance secretary Sharyn Cullis - who had been a vocal opponent of the expansion plans - said she was thrilled with the determination.
"The result is what I would have hoped," she said.
"It's a victory of drinking water over coal.
"I thought it was outstanding in the IPC's last recommendation, where they say the proposal was not in public interest.
"They clearly thought more of the public interest than about royalties. They say the water security risk was too great and the uncertain consequences too significant.
"On the balance, when they considered the social, environmental and economic factors they determined the extension not in the public interest. They're saying our drinking water is more important than coal."
Wollondilly councillor Matt Deeth said mining jobs were "crucial" in Wollondilly, but water supply was also of vital importance.
"Mining is important to Wollondilly, mining jobs in particular," he said.
"I'm keen to understand what the implications of this are.
"The challenge, which the IPC saw, is that there were issues with this proposal, and now it's time to go back to the drawing board and assess how to resolve the issues that were raised.
"At the end of the day, drinking water supply for Wollondilly and the wider Macarthur region is vital and we need to ensure that any proposal which may impact the water supply is given the utmost scrutiny.
"Once that water supply is impacted, you can't undo it."
Cr Deeth said it was important to ensure the long-term future of coking coal mining in the area as it was important to the steel-making process, while still managing and balancing the risk to the water supply.
"I'm glad to see that South32 will have a future with other expansion in Appin and plans to expand underneath areas north of Douglas Park, and looking into the feasibility of mining under Razorback."
South32 chief executive Jason Economidis said the company was "disappointed" with the refusal.
"We have a long history of operating safely and responsibly in the Illawarra region, creating jobs, investment and opportunities within the community," he said.
"We believe it's in the public interest for the project to proceed, preserving local jobs in the region.
"The NSW government had already deemed this project approvable, taking the view that the project had been designed in a manner that achieved a good balance between maximising the recovery of coal and minimising the impacts on water resources, biodiversity and other environmental values of the Metropolitan Special Area.
"The department's own experts said there was no easy way to improve the avoidance and mitigation measures we had put forward.
"This process creates uncertainty for companies considering large investments in NSW.
"We will now consider our options as we review the report in detail."
A South32 spokesman said the extension project "would not mine beneath dams, named watercourses or key stream features and has been designed to have a neutral or beneficial effect on water quality within water catchment areas".
However, Ms Cullis felt very differently and said the company's offer to offset future water losses with $103 million was far from adequate.
She said the potential water losses could be felt for more than 150 years, and no monetary value could possibly offset the potentially "catastrophic" environmental and social impacts.
The IPC findings noted South32 "was aware of concerns raised by WaterNSW and others regarding its mine design and the associated impacts".
"The applicant has made minor amendments; however, the impacts remain significant," the findings stated.
"The commission notes the applicant has offered mitigation measures for remediation of selected key stream features, financial offsets for water losses and water quality impacts and an upland swamp offset site. However, a number of these measures have not been considered acceptable by the responsible statutory agencies."
Some of the IPC's major findings:
- The subsidence effects resulting from the proposed longwall mine design are likely to be significant with surface-to-seam cracking predicted within areas 5 and 6. This subsidence will result in the degradation of 25 watercourses and swamps in the Metropolitan Special Area and lead to the potential instability and fracturing of up to 40 cliffs located above the proposed longwalls. It would also result in detrimental impacts to biodiversity, threatened ecological communities, such as Upland Swamps, and Aboriginal cultural artefacts and values
- The project will lead to significant surface water losses into the groundwater system as well as impact local ecological processes and potentially contribute to increased concentrations of metals, which may impact water quality
- There is uncertainty about predicting the volume of surface water losses into the groundwater system, with evidence of an increase in the interconnectivity of surface and groundwater sources resulting from longwall mining in the catchment
- The project would increase the area affected by subsidence, including undermining upland swamp and first, second and third order streams.
- The predicted Scope 1, Scope 2 and Scope 3 greenhouse emissions from the project would be significant.
- The project would have positive contributions to local, regional and state economy
Read the full statement of reasons for refusal here.
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