Just weeks after it was approved by the NSW Government, Federal Environment Minister Greg Hunt has “stopped the clock” on Shenhua’s Watermark coal project.
The $1.2 billion open-cut coal project, located near the Liverpool Plains, plans to produce 10 million tonnes of coal per annum for 30 years, and has come under intense scrutiny from some local farmers in the region who are concerned over water and agricultural impacts.
Hunt said it was these concerns, coupled with requests from local and federal MPs that led to the decision to halt the approvals process.
The project has been referred to the federal advisory body, the Independent Expert Scientific Panel (IESC), for a review after being approved by the NSW Planning Assessment Commission on January 30.
"I have presented a request for advice to the Independent Expert Scientific Committee, in short I stopped the clock on the Shenhua project to seek additional advice on protecting water resources and aquifers from the best experts in ground water in the country" Hunt said.
"You never take risks with water, not just for children and grandchildren but for centuries hence.”
Hunt said he was not able to provide a timeline for the completion of the review, stating that the connectivity of aquifers would be a key line on enquiry for the panel.
"It will take as long as it takes to get the best advice and the complete advice,” Hunt said.
"I want to know everything that we need to know about connectivity, about whether or not there is adequate modelling, about whether or not we have adequate proof, and my decision rests on understanding and protecting the water resources that come under the Federal Environment Act.”
State MP for Tamworth Kevin Anderson welcomed Hunt’s decision.
"I was uncomfortable and feeling challenged by what the PAC were putting forward – they were saying there's no interconnectivity between the hard rock and the alluvial and I'm challenging that," he said.
Meanwhile, New England MP Barnaby Joyce, who has spoken out against the mine previously, also said an independent review was the right path to go down.
"[Minister Hunt has] now said that he's stopped the clock, he's now said that he'll take the time that is required to diligently go through the decision as regards the water issues," Joyce said.
"This was requested by the people of the Liverpool Plains, and on this issue, we have delivered."
The decision to halt the approvals process comes just days after the chairman for Shenhua Australia criticised the government for delays in approving the mine.
Liu Xiang said he was sceptical about the process which has now been ongoing for over eight years.
“To date, after eight years, Shenhua has spent $700m and has little tangible progress to show for this investment in NSW. The process has been challenging and we have faced many delays and changes to the approvals system which nobody could have foreseen when we first entered the public tender process.
“As an international investor, we have found this experience to be inconsistent with the often proclaimed enthusiasm for offshore investment in this country, particularly in the mining sector.”
Shenhua was advised by government officials on February 12 that no additional information was required and that a decision on the mine would be made by March 13.
Commenting on the most recent delay, Shenhua said it stands by the scientific assessments undertaken to date and has “every confidence this additional review will re-confirm the conclusions reached in NSW assessment process”.