Rio’s controversial Warkworth coal mine extension close to final approval

Rio’s controversial Warkworth coal mine extension close to final approval

Bulga's Mount Thorley-Warkworth open cut mine. (Image courtesy of Rio Tinto)

Global miner Rio Tinto (ASX, LON:RIO) has scored a major win in its battle to extend its Mount Thorley-Warkworth coal mine in Australia, after New South Wales authorities said the benefits of the project outweigh any potential negative impacts.

The Planning Assessment Commission (PAC) report, however, says the approval is subject to six conditions, including measures for tighter noise and air-quality management as well as stricter management of the huge "final void" or hole left behind.

This is the second review the long contested project goes through this year. In March, authorities approved it, but subject to 22 conditions. Planning minister Rob Stokes requested a second review in August, asking the body to consider the effects of the government’s interim change to the state environmental planning policy for mining.

The policy now says the social, environmental and economic impacts of the project must be equally weighed up.

Locals disappointed

Residents of the tiny Hunter Valley town of Bulga have long opposed the mine extension, saying it would destroy their community and force many to move away.

In this second report, PAC says it ‘‘carefully considered’’ the impacts of the policy change, and balanced the key areas of concern, including those brought up by locals.

‘‘The commission is satisfied that the project’s benefits as currently understood outweigh its potential impacts, and that on balance the project is approvable,’’ it says.

Commissioned in 1981, the Mount Thorley-Warkworth is an integrated operation of two open-cut mines, located adjacent to each other. It produces about 12 million metric tons a year of thermal and coking coal for the local market and customers in Asia.

New South Wales is seen as the Australian state where it is most difficult to get mining approvals, as it outsources the process to the independent commission.