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Mining and the Environment

Mining and the Environment

Advice on legislation or legal policy issues contained in this paper is provided for use in parliamentary debate and for related parliamentary purposes. This paper is not professional legal opinion.
Briefing Paper No. 6/2009 by Stewart Smith

Mining makes a significant contribution to the Australian and NSW economy. This paper briefly places the contribution of mining into the context of the wider economy. It then focuses on the impact of coal mining on both natural and agricultural areas of NSW. The environmental regulatory regime that mining must operate under is reviewed, and the environmental impact of coal mining is presented for both underground and open cut mines.

NSW produces a diverse range of minerals including coal, metals, industrial minerals and construction materials. The total value of this production in 2007-08 was over $14 billion. Coal production contributed the greatest proportion of this value, with an estimated worth of over $10 billion (70% of total). The minerals industry is NSW’s largest export industry, accounting for export revenue of $11.1 billion in 2006-07, which is 39% of total NSW exports. Coal accounts for 56% of the total of NSW mineral and metal exports. The NSW minerals industry is based on:
    60 coal mines (29 underground, 31 open cut);
    12 major metalliferous mines;
    11 significant industrial minerals operations;
    a large number of smaller metallic and industrial mineral mines and numerous construction materials operations.

In regards to the environment, there are two main legislative provisions that relate to the regulation of mining. These are the:
    Environmental Planning and Assessment Act 1979, which covers the assessment and approval of new mines and the extension of existing ones.
    Mining Act 1992. This was significantly amended in 2008, incorporating key environmental provisions.

Proposed mining operations, like other development, must be approved via the Environmental Planning and Assessment Act 1979. This Act has two environmental planning instruments that may apply (depending on the size of proposed development).

The first of these is the State Environmental Planning Policy (Major Projects) 2005.
The aim of this Policy is to identify development to which the development assessment and approval process under Part 3A of the Act applies. Under this part of the Act, the determination of a development application is removed from the local consent authority to the Minister for Planning. Under the Policy, coal mining is subject to Ministerial determination.

The second relevant planning instrument is State Environmental Planning Policy (Mining, Petroleum Production and Extractive Industries) 2007. The SEPP highlights some key natural resource and environmental management issues that must be addressed when assessing new mining, petroleum production and extractive industries proposals.

The Mining Act 1992 was widely amended by the Mining Amendment Act 2008. However, many of the provisions in the amending Act have yet to commence. The Amendment Act included a rewrite of the objects of the Act to include reference to ecologically sustainable development, and in particular to:

(a) to recognise and foster the significant social and economic benefits to New South Wales that result from the efficient development of mineral resources.

The Act includes provisions for the regulation of mineral exploration and mining leases, including environmental management and rehabilitation.

The Environmental Impact of Mining
The environmental impact of mining is dependent on several factors, including the extraction technique and where the mine is situated. For instance, in regards to coal mining, underground mining has different impacts compared to open cut mines. This paper looks at both of these extraction methods and reviews their environmental impact.

Coal resources in the Southern Coalfield, located in the Illawarra region of NSW, is extracted using the technique of longwall mining. This is a method of underground coal mining whereby blocks of coal, known as ‘panels’, are extracted from a coal seam by a shearer moving along the face of the panel. As mining progresses along the length of the panel, the overlying strata collapses behind the advancing longwall face. Subsidence, or the lowering of the land surface is an unavoidable consequence.

There has been significant community concern about the impact of coal mining on the natural features of the Southern Coal Fields. The NSW Department of Environment and Climate Change noted that longwall mining subsidence is frequently associated with cracking of valley floors and creeklines with subsequent effects on surface and groundwater hydrology. Of particular concern is the potential for longwall mining to affect upland swamps on the Woronora Plateau. Upland swamps, particularly peat swamps, are important to catchment hydrology and ecology because they absorb water and allow runoff for long periods after rainfall has ceased.

The Sydney Catchment Authority has noted the lack of scientific data to help assess the precise nature and extent of the damage from subsidence to groundwater systems. Groundwater may play a crucial role in maintaining stream flows during periods of severe drought, and subsidence impacts on system water yield are not well understood.

In regard to the environmental impact of underground mining, the NSW Minerals Council noted that:
    Subsidence from underground mining will have some environmental effects – as do most kinds of development. The question that needs to be answered is one of the acceptability of impacts.
    Environmental impacts may be insignificant in a regional context. The impacts of mining may be localized or temporary, and not as relevant when considered in the context of other land uses in the region.
    The Government must make decisions on the acceptability of impacts by assessing a project’s net benefit or cost to society by taking into account all economic, social and environmental factors.

To help inform it in late 2006 the NSW Government established an Independent Review of Coal Mining in the Southern Coalfield. The Review concluded that with few exceptions, at depths of cover greater than about 200 m coal cannot be mined economically by any mining method without causing some degree of surface subsidence. If mining of hard coking coal in the Southern Coalfield is to continue, then a certain level of subsidence impact must be accepted as a necessary outcome of that mining. In terms of planning approvals for new or extension of existing mines, the Review concluded that the key role of the Part 3A approval under the Environmental Planning and Assessment Act 1979 should be to clearly define required environmental outcomes and to set appropriate performance standards. The subsequent role of the Subsidence Management Plan should be one of management.

On 22 June 2009 the Minister for Planning Hon Kristina Keneally MP made her first Ministerial determination on a Southern Coalfield mine since the release of the Southern Coalfields Review. The Metropolitan Colliery Project approval provided for specific environmental conditions, expressed in terms of performance measures.

The impact of mining on agricultural areas has been the focus of much recent attention. These concerns have arisen due to the granting of coal exploration licences in the in the Gunnedah Coal Field. For instance, in April 2006 the NSW Government issued BHP Billiton a five-year coal exploration licence covering 344 square kms at Caroona in the Liverpool Plains region of NSW. In August 2008 the Government granted an exploration licence to the China Shenhua Energy Company for the Watermark area near Gunnedah for a period of five years.

A major concern of the Liverpool Plains community is the impact of coal exploration and mining on underground and water resources. These concerns are not restricted to this region alone, so it is potentially illuminating to see what restrictions or guidelines on the coal industry have been applied in another major agricultural region, the Hunter Valley.

Open cut mining is the main extraction method in the Hunter Valley. This involves scraping off overburden and digging out a pit to recover the coal. This can result in a whole different set of environmental impacts compared to underground mining.

Open cut mining can have major impacts on streams, alluvial aquifers and alluvial soils. Mining which removes alluvium to reach coal beneath has an obvious impact on an alluvial aquifer, requiring it to be dewatered during mining, and with very little probability of successful restoration afterwards.

Salt occurs naturally in many of the rocks and soils of the Hunter Valley. Some of this salt is leached into groundwater and nearby rivers. During coal mining, salty water collects in mine pits, and has to be pumped out to allow mining to continue. What to do with this saline water is a major management problem for many coal mines.

Underground coal mining close to or beneath alluvial aquifers, or open cut mining close to alluvial aquifers may lead to fracturing of the hard rock layers that confine the ground water. The result is that any significant degree of fracturing will establish additional conduits for increased movement of saline groundwater into the alluvial aquifers, and to surface water features.

In response to these concerns, Government agencies operate under an informal policy that no further open cut mining should take place within the Hunter River’s alluvial floodplain and its prime alluvial aquifer. There has also been a guideline on the management of stream and aquifer systems in the Hunter Valley, which provides for 40m setbacks in the case of underground mines to alluvial aquifers, and a 150m setback for an open cut mine.

On the 14th May 2009 the Hon Lee Rhiannon MLC introduced a Private Members Bill into the Legislative Council. The Mining Amendment (Safeguarding Agricultural Land And Water) Bill 2009 sought to amend the Mining Act to protect prime agricultural land and water sources that feed it from mining operations and mining exploration. The Bill, whilst supported by the Coalition Opposition, was negatived at the Second Reading Speech stage on June 4th 2009. One of the disputed points was how to define and identify prime agricultural land.

In response to community concerns about the impact of mining exploration on the water resources of the Namoi River catchment, the Minister for Primary Industries Hon Ian Macdonald MLC established a water study working group in August 2008. Chaired by former Member the Hon Pam Allan, the Minister told Parliament on 4th June 2009 that the working group had finalised and agreed to a draft terms of reference for an initial water study in the Namoi catchment.

Mining contributes enormously to the Australian and NSW economy. The minerals industry is NSW’s largest export industry, accounting for export revenue of $11.1 billion in 2006-07, which is 39% of total NSW exports. However, this is not without cost. Environmental groups and some sectors of the community would like to see greater environmental protection of natural features from the environmental impacts of coal mining, particularly subsidence. Similarly, the potential impact of mining on water resources of the State has created conflict in agricultural communities. With estimated Australian coal reserves of some 200 years, this debate seems far from over.