The state's independent Planning and Assessment Commission (PAC) has rejected the Drayton South Coal Project.
Anglo American owners of the Drayton open cut mine had proposed to continue their operations into the southern part of their existing mine lease once current production ceased in 2015.
Their development known as the Drayton South project would have utilised existing Drayton infrastructure and equipment as well as their 500 employees and over the life of the mine deliver $950million in royalties to the state government.
But the expansion of the mine brought it close to two of the country’s biggest thoroughbred horse studs Coolmore and Darley (Woodlands) near Jerrys Plains.
In the PAC review on the project the Commission concluded that the open cut mine should not proceed at the planned scale in this location.
“The Coolmore and Woodlands horse studs should be recognised as essential to the broader Equine Critical Industry Cluster and given the highest level of protection from the impacts of mining, “ the review states.
“The mine plan proposed for the site should not be approved.
“Any open cut mining contemplated on the site should be required to demonstrate that its impacts will not affect the viability of the Coolmore and Woodlands horse studs.”
The PAC review covering some 120 pages including two expert reports on the project came to the same conclusion as a previous PAC review of May 2010 into the Bickham Coal Mine near Murrurundi ‘that international scale thoroughbred breeding and open cut coal mines are incompatible land uses.’
PAC was requested by the NSW Planning Minister Brad Hazzard to assess the potential impacts on the two studs from Drayton South Coal project and recommend any additional mitigation measures.
In the review the two studs are described as being the core operations that support the entire Upper Hunter Critical Industry Cluster – Equine (CIC) and therefore they need protection from the mine and this would require a buffer of at least several kilometres not the proposed 500metres.
Such a buffer it is suggested may make the mine unviable because it would sterilise more coal reserves and create problems with the sequencing of the dragline operations.
One of two expert reports was prepared by Terry Short, La Tierra Pty Ltd, Brisbane and it was highly critical of the mine’s Environment Assessment due to its failure to address the issue of protection for the CIC and the importance of the two studs to the operations of the CIC.
The two studs produce almost half of the country’s stallion fees and they are the core businesses of the Upper Hunter CIC – the region’s iconic industry that complements the wine and tourism industries.
Mr Short’s advice to PAC is to provide protection to the studs similar to that afforded to areas overseas such as Kentucky in the USA and Newmarket in England.
Anglo American expressed disappointment with the PAC report into the Drayton South project which recommended significant changes to the mine plan.
Anglo American’s Coal business, chief executive officer, Seamus French, said this decision was a severe blow to the 500 people who work at Drayton mine and the families they support.
“We have followed all the rules, consulted extensively and made $6 billion worth of compromises to reduce project impacts through revised mine designs,” Mr French said.
“Significantly, we have forgone 53 million tonnes of coal, worth more than $5 billion, to move the mine behind the ridgeline to negate the visual impacts on our neighbours.
“This decision is disappointing for the people of New South Wales.
“The PAC’s decision puts an annual $35 million in State Government Royalties and $70 million a year with local businesses in serious jeopardy,” Mr French said.
Mr French said Anglo American would now work through the PAC’s recommendations to better understand their implications and consider the options moving forward.
In contrast Cameron Collins, president of the Hunter Thoroughbred Breeders Association welcomed the PAC's recommendations, that Coolmore and Darley horse studs should be given the highest level of protection and the Drayton South mine plan proposed for the site should not be approved.
"Our entire industry welcomes this report. Without Darley and Coolmore our critical industry cluster in the Hunter Valley would be at risk along with hundreds of jobs, our support and supply industries and our status as one of only three international Centres of Thoroughbred Breeding Excellence in the world", Dr Cameron Collins said.
"The PAC has undertaken a comprehensive assessment process and has engaged experts of their own to advise them. We thank the PAC for taking the time to understand our industry, the considerable threats to our future, to our employees and to our globally recognised critical equine cluster posed by the Drayton South mine proposal" Tom Magnier, principal Coolmore Australia said.
"It is reassuring that the PAC took the time understand the importance of our industry and the impact this mine would have on our businesses and our employees, many of whom permanently reside on our farms. No amount of written material could substitute for a first hand appreciation of these matters" Mr Henry Plumptre, Darley's managing director said.
In a media statement from the Department of Planning and Infrastructure says this is one step in a comprehensive assessment of the proposal – albeit an important one – and no final decision has been made.
The Department of Planning and Infrastructure's assessment of the project is ongoing and the department will now give careful consideration to the PAC report, alongside other important input such as public submissions, stakeholder input and the company's response to issues raised.