The New South Wales (NSW) Government has signed an agreement to buy back a majority of a coal exploration licence previously granted to China Shenhua Energy, amid protests by farming groups and environmentalists opposed to mining on fertile agricultural land.  

Under the agreement, the government will reclaim/take back possession of 51.4% of Shenhua’s exploration licence by refunding around $262m from the amount paid by the company.

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The licence, which covers the fertile black soils of the Liverpool Plains, was awarded by the previous Labour administration.

NSW Resources Minister Don Harwin said: “While the previous Labour government granted the original exploration licence, this government has determined there should be no mining on the fertile black soils of the Liverpool Plains.

“Any future mining activity will now be restricted to the ridge lands, with a commencement still subject to further management plans and the ongoing monitoring of strict conditions already in place.”

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"This government has determined there should be no mining on the fertile black soils of the Liverpool Plains."

The reclaimed land will be used for farming.

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Minister for primary industries and regional water Niall Blair said that future mining operations will have to meet the strict water management conditions. 

Shenhua’s proposed activities on the licence have been assessed and will be put through continual monitoring.

In order to start mining operations, the firm has to obtain approval for detailed management plans in relation to water management, biodiversity, and environmental management.

Image: A sign protesting the use of coal in the Liverpool Plains, NSW. Photo: courtesy of Jeremy Buckingham/Wikipedia.