China`s Shenhua sticking with Australia coal project despite legal challenges
Source: www.chinamining.org Citation: Platts Date: February 19, 2016
China coal giant Shenhua remains committed to its sole Australian export coal project despite legal challenges from environmental groups the latest this week in the New South Wales Land and Environment Court, an Australia-based spokesman for the company said Thursday.
Seven months have passed since Australian federal environment minister Greg Hunt gave his approval last July for Shenhua`s 100%-owned Watermark project in the Liverpool Plains pastoral region of New South Wales, thereby allowing it to proceed to its development phase.
The project involves the extraction of 133 million mt of metallurgical coal and 26 million mt of thermal coal for shipment through Newcastle port, and has attracted controversy over its potential impact on groundwater supplies including freshwater acquifers and on farmland.
Conservation group the Upper Mooki Landcare group and Shenhua Watermark Coal is listed for a judgment hearing at the Land and Environment Court in Sydney on Friday, according to the court`s website.
The legal challenge by the Upper Mooki Landcare group concerns the potential impact on 850 hectares of habitat for koala bears that stands to be cleared for Shenhua`s Watermark mine project in the Gunnedah Basin coal field of New South Wales.
Shenhua has spent about A$1 billion ($700 million) on its Watermark project since landing an exploration license for the mine site in 2008 for which it paid A$300 million.
The Chinese company has incurred additional costs since such as A$200 million on acquiring land from local farmers, and A$175 milion of infrastructure spending.
The Watermark project will have an estimated capital cost of A$780 million when it eventually goes ahead.
SETBACKS
Shenhua has suffered a number of setbacks in relation to its Watermark project, including having to resubmit -- along with other coal companies -- its application for a mining license after a new planning approvals process was introduced following the 2011 New South Wales state election.
Undeterred, Shenhua said via a spokesman Thursday that it intends to see the project through to its completion.
"The company continues to work on various regulatory requirements since achieving state and Commonwealth government approvals last year," said Shenhua Watermark spokesman Jonathon Moore by telephone from Sydney.
The New South Wales government`s independent Planning Assessment Commission gave Shenhua approval for the environmental aspects of its Watermark project in 2014.
This allowed for the extraction of up to 10 million mt/year of coal at the Watermark site until June 2046.
Thermal and coking coal mined from the project`s three open-cut pits will be transported 282 km (175 miles) via rail to Newcastle port. During the mine`s peak production period, 16 train movements a day will be required, said Shenhua in a submission report to the PAC.
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