Rio’s debated Warkworth coal mine extension approved with conditions

Rio’s debated Warkworth coal mine extension finally approved

Mount Thorley Warkworth mine. (Image by Jeremy Buckingham MLC)

Global miner Rio Tinto (ASX, LON:RIO) scored a major win in its battle to extend its debated Mount Thorley-Warkworth coal mine in Australia, after New South Wales authorities announced the approval of a revised plan submitted last year.

The Planning Assessment Commission (PAC) report, however, notes that the Warkworth mine "will undoubtedly have a range of adverse impacts on [the nearby] Bulga village and its community", adding that Rio needs to give "serious consideration" to compensation being paid to residents.

It also says that Rio will have to provide additional information on a number of matters before authorities can make a determination and impose rigorous environmental conditions.

“While the PAC’s recommendation is a positive step for Mount Thorley Warkworth, it is absolutely critical that a final decision is now made as quickly as possible,” the mine’s general manager, Mark Rodgers, said in a statement.

Long-dragged debate

Mount Thorley-Warkworth’s expansion had been repeatedly knocked back in the courts in the last two years. First, the Land and Environment Court rejected the commission's initial verdict that the project’s economic benefits outweighed the environment damage. Then, the Supreme Court dismissed Rio’s appeal upholding the earlier decision in favour of the residents of Bulga — a village near the mine and 180 km north of Sydney — who had claimed the company’s pit expansion would wreck their community.

The area to be cleared by the extension includes part of the endangered Warkworth Sands woodland ecosystem that the miner had pledged to protect as an offset when it obtained approval for the original mine in 2003.

Rio’s debated Warkworth coal mine extension finally approved

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

John Krey, spokesman for the Bulga Milbrodale Progress Association, said Thursday's PAC approval was “confirmation that the legal and regulatory system that governs mining is broken and that NSW residents cannot count on it to serve the public interest or protect our precious land, water and heritage.”

In a statement, Rio welcomed the decision as it will allow the company extract up to 18 million tonnes of coal a year over 21 years and secure the jobs for nearly 1,300 people currently employed in the area.

The Warkworth open-pit operation is part of a larger mining complex producing about 12 million metric tons a year of thermal and coking coal for the local market and customers in Asia.