Rio Tinto’s Bengalla mine has been granted approval by the Planning Assessment Commission.
The miner had applied to extend the mining lease at Bengalla beyond 2017 for a further 24 years.
This will allow the extraction of 316 million tonnes of coal over the project’s life time, or 15 million tonnes of coal per year.
In its assessment, PAC found the mine, located four kilometres west of Muswellbrook, would increase the dust, noise, blasting and visual impacts of the existing mine, as mining operations moved further to the west.
It said these impacts, combined with the impacts of other mining operations in the region, would impact 19 privately-owned properties.
A total of 168 properties are expected to experience significant exceedances of relevant standards.
However PAC found that measures put in place by Rio to minimise the noise and dust emissions from the project are reasonable and feasible, recommending the company acquire the 19 significantly impacted properties at the request of the landowner at any stage during the life of the project.
PAC also placed strict conditions around water resources, biodiversity impacts and traffic.
The mine is expected to generate $778 million of royalties for the state government, and $509 million to the federal government.
Around 300 people will be needed to construct the extension, with the mine set to employ 900 people once fully operational.
NSW Minerals Council chief executive, Stephen Galilee, said Bengalla’s approval was good news for families living in the Hunter Valley.
"The 362 mining workers and their families at Bengalla now have a certain future,” Galilee said.
Others are not happy about the approval, which comes on the same day as Yancoal’s Moolarben coal mine was granted a 24 year life extension.
Greens spokesman Jeremy Buckingham claims the NSW government has approved 1.3 billion tonnes of new coal mine capacity since September.
"The flurry of coal mine approvals is negligent and represents a suicidal approach to climate change," Buckingham said.
"Approving hundreds of millions of tonnes of new coal mining is globally significant and undermines efforts to avoid dangerous climate change.”