Coal mine overturned (news story with case similar to ours)

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It's official: Shenhua's Breeza coal mine plan extinguished

The 15-year battle forged by farmers on the Liverpool Plains to stop Shenhua's open-cut coal mine is finally over after the NSW Government announced on Wednesday it will buy out the Watermark mining lease for $100 million.

Announcing the agreement in Breeza, NSW Deputy Premier John Barilaro said the decision was made to strike the right balance between protecting prime agricultural land and mining.

The decision means that Shenhua will have to relinquish over 22,000 hectares of mainly farm land, bought from local farmers at heftily inflated prices.

Many of the 32 farms bought were leased back by their former owners. Some of the land is also expected to be designated to protect aboriginal sacred sites, koala habitat, and renewable energy projects.

Mr Barilaro said the NSW Government will cancel Exploration Licence 7223, releasing Shenhua from its obligations under the exploration licence.


"The NSW Government is committed to making NSW the number one investment destination for mining in Australia, but we need to find a balance, and this decision will deliver certainty to farmers and the Liverpool Plains community, while guaranteeing protection to parcels of land with high value biodiversity," he said.


NSW Treasurer Dominic Perrottet said the NSW Government was committed to supporting "the common sense, responsible development of our high-quality coal resources, however we are a balanced government, and we also need to protect prime agricultural land".


"The cancellation of this project will mean that no open cut coal mining can occur in the area. Coal will of course continue to be an important part of our economy and is essential to supporting jobs, and the NSW Government continues to support coal exploration in areas where it makes sense," Mr Perrottet said.


The Government said the agreement also includes:

  • The acquisition of more than 6,000 hectares of high biodiversity land to be managed by Local Land Services including the protection of habitat for koalas and other endangered species

  • Protecting significant Indigenous cultural sites and artefacts

  • Ensuring that water that would have been taken by the mine can continue to be used for agriculture and other productive uses

"The NSW Government thanks Shenhua for its cooperation in reaching this agreement," Mr Barilaro said.


The company had only started exploration drilling in January last year after holding the exploration licence since 2018, with that due to expire in October this year. The project has been on the table for 15 years.


Shenhua had been planning to extract 10 million tonnes of coal a year over 30 years.

Lock the Gate Alliance NSW spokesperson, Georgina Woods, said, "Farmers and Traditional Owners have lived with the threat of this mine for more than a decade. It's essential that Liverpool Plains farmers can now focus on doing what they do best - growing food and fibre for Australia."


"While we would like to see the Berejiklian Government's sudden desire to protect prime farmland and cultural heritage sites from inappropriate coal mining applied elsewhere in the state where similar battles continue, today is indeed a day for celebration.


"The government must be congratulated for taking this opportunity to end the uncertainty this mine created for the community and protecting this incredibly important area. It's a very significant step.


"It's crucial that the government now works with the local community on a process for returning the land owned by Shenhua, including providing ownership of cultural sites to Gomeroi Traditional Owners and facilitating a shift back from mining to farming."


Ms Woods also commended the Berejiklian Government for announcing a $25M per annum "Royalties for Rejuvenation" fund for communities faced with economic disruption as demand for coal declines around the world.


Farmers on the black soil rich Breeza Plains have been concerned the new mine would cut their groundwater supplies, including John Hamparsum, Drayton.


"We have been very concerned at what effect the mine would have on our groundwater supply as we depend on that for our crops." Mr Hamparsum said.


"This will be a big relief. As far as I see it it will be a win-win for the government."

He said he hoped things would return to where they should have been in the early 2000s when there was a massive reallocation of groundwater entitlements.


If there was a land sale he hoped the farmland would be put back on the market, that sacred sites for the local aborigines would be protected or handed back, and some area could be used for renewable energy projects.


Some of the farmers who had sold their farms to Shenhua, had leased their country back. Shenhua had paid top market value for the land. The Government had already agreed in 2017 to pay Shenhua $262 million to hand back 51 per cent of the exploration licence. The large Chinese mining company had paid $300 million for the exploration licence in 2008.

Shenhua released a statement on Wednesaday about the agreement: "Shenhua Watermark Coal (Shenhua) confirms that it has reached an agreement with the New South Wales Government to cease its Watermark Project through the cancellation of Exploration Licence (EL) 7223.

"While the project obtained state and federal government consents through rigorous merit-based approval processes, this decision reflects shifting economic and social circumstances since the project first commenced in 2008.


"The State has agreed to pay Shenhua $100 million for the cancellation of the EL. We appreciate the NSW Government's willingness to work with Shenhua to reach an acceptable financial outcome.


"We would like to express our sincere gratitude to the local community for working closely with Shenhua during the project's consultation process."


A report released in May last year found NSW and Queensland coal mines are using about 383 billion litres a year. Mr Hamparsum said he was very concerned at the wastage of water on coal mines and the possible loss of underground water.


"The concern for us in agriculture is that burning coal is adding to climate change," he explained.


"Its a double whammy for us. We are seeing this wastage of water, and to then be wasting it on something that is making our climate worse."


National Farmers Federation president Fiona Simson who has a property nearby has been a vocal critic of the Shenhua project, urging government to protect prime farming country.

In 2019, she hit out at the NSW Government changing the planning process, which she said lacked transparency, and was "another example of the government moving the goal post to suit the mining company that had failed to meet numerous deadlines".


Jamieson Murphy reported in 2019 for The Land that the changes allowed Shenhua to commence pre-construction works before it has submitted studies on the mine's impacts to vegetation and groundwater.


"The feeling on the ground at the moment is absolute frustration and disappointment," Mrs Simson said.


"This has further eroded our confidence, and the transparency, of the planning and assessment process."


At Drayton, the Hamparsums grow everything from canola, cotton, sorghum to radish.

Also read: Caroona Coal Action Group's Susan Lyle slams wait over Shenhua Watermark mining application


The NSW Government also made another two announcements today in relation to the coal industry, revealing a new fund from coalmining royalties to help coal mining communities.

Mr Barilaro said the new Royalties for Rejuvenation fund will see $25 million set aside each year to ensure coal mining communities have the support they need to develop other industries in the long-term.


"Make no mistake, coal mining has a strong future in this state, but to ensure stability for the long haul we are setting aside funds so those coal mining communities, who produce such a valuable resource for our state, can plan what their future looks like," Mr Barilaro said.

"Today we are announcing a future fund, for future generations and future jobs, to ensure long-term prosperity in regional NSW.


"The NSW Government's Future of Coal Strategy is a roadmap for the coal industry in NSW, but we understand that mines have a lifespan, and we need to ensure coal mining communities keep quality high-paying jobs in their towns for the next generation and the generation after that."


NSW Treasurer Dominic Perrottet said the NSW Government "recognises that the coal mining industry is the economic backbone of this state and in turn coal mining communities need certainty for their future".


"Hundreds of millions of dollars will be invested in these communities over coming years to ensure jobs and investment in our vital regional areas," Mr Perrottet said.


"We want to ensure mining towns continue to have highly skilled well-paid jobs in growth industries that will lock in their economic security long into the future, so young people have the opportunity to remain in the town where they grew up."


This initiative follows the NSW Government's introduction of the highly successful Resources for Regions program in 2012 which has seen $345 million invested in local mining communities.


Meantime, Deputy Premier John Barilaro said the NSW Government will release the Wollar area for potential coal exploration, with interested parties to be invited to apply for an exploration licence.


Mr Barilaro also said the NSW Government's Future of Coal Statement will also be amended to show that open cut coal mining at the Dartbrook site would not be supported.


"Release of the Wollar area follows an assessment under the Competitive Allocation Framework and opens it up for potential exploration activities, to investigate the viability of mining," Mr Barilaro said.


"Applicants with suitable technical and financial qualifications will be invited to participate in a tender process, with the winner able to proceed with exploration for coal in the Wollar allocation area.


"It is clear in the Upper Hunter locals do not oppose the underground mine at Dartbrook, however an open cut mine is not in line with extensive community consultation. By amending the Future of Coal map we will rule out open cut mining, without impacting the proposed extension for the underground mine."


"Last year, I announced the Future of Coal Statement to provide certainty to industry and communities by mapping out where coal projects will or won't continue and both of these decisions reflect that commitment," Mr Barilaro said.


"We want to make sure that coal mining can take place in areas where it makes sense.

"Coal mining generates jobs for communities and royalties that can be used for essential public services and infrastructure and regional economies will depend on coal mining as a key industry for decades to come.


"The support mining provides to our regions should not be underestimated, it provides career opportunities for young people, brings families into towns and keeps money flowing to support other businesses."

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