Australian mining company South32 has announced it will not proceed with a plan to extend the life of its Dendrobium coal mine below Sydney’s drinking water intake.
- South32 has notified the Australian Stock Exchange that it will not proceed with an extension
- The company had planned to extract an additional 78m tonnes of metallurgical coal from the underground operation in NSW Illawarra
- Instead, the company will seek to extend the life of the mine within approved domains.
The company had planned to extract an additional 78m tonnes of metallurgical coal from the underground operation, west of Wollongong, by 2048.
On Tuesday morning, South32 notified the Australian Stock Exchange that it would no longer proceed with the project and will instead seek to extend the life of the mine within approved domains.
His original extension application was rejected by the Independent Planning Commission in 2021 and his revised plan was later given State Significant Infrastructure status by the NSW government.
It was under consideration for approval by the state planning minister.
South32 CEO Graham Kerr said he made the decision after extensive analysis of alternatives for the mine.
“Over the past 18 months, we’ve made significant progress actively reshaping our portfolio, and this decision increases our ability to direct capital toward other opportunities,” Kerr said.
“This includes our world-class development options in North America.
“[It has] the potential to underpin a significant growth profile to produce critical metals for a low-carbon future, serving strategically important supply chains.”
The company says mining at its nearby Appin coal mine is expected to continue until at least 2039.
The Dendrobium mine began operations in 2002 and supplies coal to BlueScope Steel and Whyalla Steelworks’ Port Kembla works.
Under its current license, the mine has consent to continue operating until 2030.
The proposal puts “much at risk”
Deidre Stuart of Protect Our Water Catchment welcomed the announcement and said it had been a long fight.
“This is great news, the original Dendrobium proposal should never have been allowed in the basin,” said Dr Stuart.
“There has been a lot of work by many people, community groups who have tried to raise awareness about the impacts of mining in the basin
“There was a lot at risk here.”
Dr. Stuart said that the state government should use this opportunity to create legislation to prevent future mining activities in the water catchment.
Independent MP Justin Field said he was very pleased by the community, raising legitimate concerns about the project.
“It was really going to be very risky for water catchments, and of course the climate impacts were also quite significant,” Field said.
“This is carbon and emissions left in the ground, so that’s a good thing.
“Hopefully it creates the opportunity to accelerate investment to green our steel industry.”
The district vice president of the Construction, Forestry, Maritime, Mining and Energy Union said the decision would affect some 500 direct jobs and hundreds more in support functions.
“We were hoping the project would go ahead, so it was very unexpected news this morning for us and our members,” said Bob Timbs.
“The mine life right now won’t go past 2028 unless they can explore and open up other mining lanes at the current footprint.
“They have said that their expected returns are not supportive of the investment and that is fair, but it is bad news for us, bad news for our members and bad news for Illawarra.”
Timbs anticipated that younger members would begin to consider their exit strategy from the operation, but said the company’s decision did not spell the end of local coal mining.
“Not at all, there’s still a lot of coal in the area to be mined … it’s certainly not the end of the coal industry in the southern coalfields,” he said.
“We have six years to go and hopefully there could be further extensions or expansions at the mine that could last beyond 2028.
“So we have plenty of time to help our members.”