Rio Tinto's plan to expand a coal mine in New South Wales (NSW), Australia, has been put on hold after the NSW Land and Environment Court overturned the state government's approval of the project, a decision which will put 1,300 jobs at risk.
The court rejected the expansion plan of Mount Thorley Warkworth mine, which is owned by Rio's unit Coal & Allied, citing environmental and social concerns.
The expansion would have cleared 766 hectares of forest, placing the mine within 1.6 miles of the town of Bulga, and extended activities at the mining complex by nearly 13 years to 2033.
The Warkworth Extension Project had been approved following a rigorous and transparent process spanning two and half years.
The NSW Department of Planning had recommended approval and then referred the project to an independent Planning Assessment Commission, which conducted public hearings before approving the project on behalf of the NSW Government in February 2012.
Coal & Allied acting managing director Darren Yeates said that the outcome is a blow to the company's plans for the mine at a time when the Australian coal industry is under pressure to remain globally competitive.
The company is planning to conduct a review of this judgement to determine its options, and will also undertake a review into the viability of the Mount Thorley Warkworth operation, he said.
"This will include looking at other development options, however this would require a significant capital investment in an environment where many Australian coal mines are struggling to survive," Yeates added.
Coal & Allied added that the court ruling demonstrates the failure of the planning process in NSW to deliver timely and predictable outcomes.
The Warkworth Extension Project was the continuation of operations at Mount Thorley Warkworth mine and was critical to the ongoing employment of the project's existing workforce.
Coal & Allied said the extension would have created an additional 150 jobs over the life of the mine.
Mount Thorley Warkworth mine, which has been in operation since 1981, supplies international and domestic markets with up to ten million tonnes of semi-soft coking coal and thermal coal per annum.
In May 2003, the mine was granted an approval to extend mining until 2020 with a maximum annual capacity of 18 million tonnes of run-of-mine coal.
Image: Mount Thorley Warkworth supplies international and domestic markets with up to ten million tonnes of semi-soft coking coal and thermal coal per annum. Photo: Rio Tinto Coal Australia.