MAJOR PROJECT ASSESSMENT Chain Valley Colliery Domains 1 & 2 Continuation Project

Transcription

1 MAJOR PROJECT ASSESSMENT Chain Valley Colliery Domains 1 & 2 Continuation Project Director-General s Section 75I of the Environmental Planning and Assessment Act 1979 January 2012

2 Cover Photo: View of Chain Valley Bay (foreground), Chain Valley Colliery Pit Top Facilities (lake foreshore) and Vales Point Power Station. Crown copyright 2012 Published January 2012 NSW Disclaimer: While every reasonable effort has been made to ensure that this document is correct at the time of publication, the State of New South Wales, its agents and employees, disclaim any and all liability to any person in respect of anything or the consequences of anything done or omitted to be done in reliance upon the whole or any part of this document.

3 EXECUTIVE SUMMARY LakeCoal Pty Ltd (LakeCoal), a joint venture between LDO Coal Limited (80%) and Sojitz Australia (20%), operates the Chain Valley Colliery, an underground coal mine, located approximately 60 kilometres southwest of Newcastle in the Lake Macquarie and Wyong local government areas. Chain Valley Colliery has been operating since the 1960s and was not previously required to obtain development consent for its operations. However, the mine now needs project approval to continue its operations past 31 March Mining is undertaken using bord and pillar, pillar extraction and miniwall methods. About 750,000 tonnes of run of mine (ROM) coal is currently extracted annually for use by local power stations and for export through the Port of Newcastle. LakeCoal is seeking approval for the production of up to 1.2 million tonnes of coal a year until The project is a precursor to LakeCoal s further project application to continue mining for approximately 21 years in total. The project, known as the Chain Valley Colliery Domains 1 & 2 Continuation Project, would allow underground mining operations to continue within existing mining areas (Domains 1 & 2 and Parcel A), while LakeCoal collects data and prepares its application for the continuation of mining over the longer period of proposed mining. The mining reserve of ROM coal is 4.4 million tonnes. Maximum production is planned to increase from 1.1 to 1.2 million tonnes a year. LakeCoal is currently mining in accordance with approved Subsidence Management Plans (SMPs) which apply to all mining areas subject to this application. The Department received 16 submissions on the project, including 9 from government authorities, 2 submissions from special interest groups and 5 public submissions. The public authorities raised issues associated with subsidence impacts, seagrass beds, benthic ecological communities, noise and air quality assessment methodologies, Aboriginal heritage and groundwater impacts. LakeCoal provided additional information that addressed these concerns. Five public and special interest group submissions objected to the project while two provided support. The main cause of objection was the continued use of public roads to haul coal. The Department has carried out a detailed assessment of the merits of the project, in accordance with the requirements of the Environmental Planning and Assessment Act The Department has assessed the project application, the project environmental assessment, public and agency submissions, LakeCoal s Response to Submissions and additional information supplied in response to Departmental questions. This assessment found that, with the implementation of appropriate mitigation measures, the project would result in minimal environmental impacts. The Department has recommended conditions of approval to ensure that the potential impacts of the project are mitigated or managed. These conditions are consistent with other recently-approved underground coal mining operations. Particular regard has been given to the protection of seagrass beds and the foreshore of Lake Macquarie, the implementation of best practice noise management, surface water management improvement opportunities and the strict management and monitoring of road transportation of coal from the mine. The expected impacts of up to 360 millimetres of subsidence within Lake Macquarie are considered to be minor. LakeCoal has committed to continue to apply subsidence and seagrass management plans to avoid potential risks to sensitive features such as seagrass beds and the shoreline of Lake Macquarie, where subsidence would be limited to less than 20 mm (the effective limit of measurement) which is predicted to avoid any subsidence impact at all within these areas. Road transportation of coal is a sensitive issue for the general public, which is reflected by the Government s existing goal to remove coal trucks from public roads wherever reasonable and feasible. LakeCoal has begun to transport coal to the adjacent Vales Point Power Station using a route composed entirely of private roads. This has eliminated all right-turns by laden coal trucks entering Ruttleys Road, which is an important improvement to road safety in the area. However, the Department accepts that transport by public road is the only current economically-feasible method to deliver coal to Munmorah Power Station and the Port of Newcastle. 1

4 The project would have minimal impacts on surface water, groundwater and biodiversity within the site, although improvement opportunities have been identified for the management of sewage effluent and on-site surface water run-off. The project is not expected to have any additional impact on surrounding residences, when compared to the current operations of the mine which have taken place over the last 45 years. However, the Department has recommended conditions requiring LakeCoal to monitor air and noise emissions to control impacts, particularly for neighbouring residents and to pursue long-term noise reduction goals, where reasonable and feasible to do so. The Department s assessment has found that the project represents an appropriate continuation of an existing mine, which would provide for continued social and economic benefits to the Lake Macquarie and Wyong regions and the State, including: direct employment for 120 employees for up to 5 years; capital investment of $25 million; provision of domestic coal for use in Vales Point and Munmorah Power Stations; generation of $85-$136 million per annum in income from domestic and export coal sales; and provision of royalties and payroll taxes for the State Government. Approval of the project would provide for the continuation of an existing mining operation which would make use of existing facilities. The Department considers that the project is in the public interest and should be approved subject to conditions. 2

5 1. BACKGROUND LakeCoal Pty Ltd (LakeCoal), a joint venture between LDO Coal Limited (80%) and Sojitz Australia (20%), operates the Chain Valley Colliery located approximately 60 kilometres (km) southwest of Newcastle in the Lake Macquarie and Wyong local government areas (see Figure 1). Figure 1: Project Location and Coal Transport Routes 3

6 Chain Valley Colliery is a relatively small mining operation, employing approximately 120 people, which has historically mined the Wallarah, Great Northern and Fassifern Seams by underground methods from beneath Lake Macquarie and its foreshores. It typically produces 750,000 tonnes of runof-mine (ROM) coal annually, with a historical maximum of 1.1 million tonnes (Mt). The Colliery began operations in the 1960s and most coal produced is exported through the Port of Newcastle, with a lesser proportion supplied to Vales Point and Munmorah Power Stations and a minor amount supplied to other industrial customers. Myuna Colliery, which also mines the same three seams beneath Lake Macquarie and its foreshores, is located immediately to the north. The project area boundary is shown in red outline in Figures 1 and 2. The existing mining operations are undertaken within the Fassifern Seam, which is located approximately 30 metres (m) below the Great Northern Seam. There are no mineable coal reserves remaining in the uppermost Wallarah Seam. Mining operations are not currently being undertaken in the Great Northern Seam, although mineable reserves remain. Existing surface facilities at Chain Valley Colliery include a number of administration buildings, workshops, water management infrastructure (including 13 pollution control dams), a coal processing plant (CPP), coal stockpiles and a 1200 tonne truck-loading bin. The existing mine access infrastructure includes a personnel-and-materials drift (roadway from surface to seam), a ROM coal conveyor drift and a downcast ventilation shaft. An up-cast ventilation shaft and fan is separately located on Summerland Point. The location of facilities within the Pit Top site is shown in Figure 3. ROM coal is crushed at the CPP prior to being stockpiled and/or loaded onto trucks for transportation to the Port of Newcastle for export or trucked to either Vales Point or Munmorah Power Stations, with the respective transport routes being almost entirely comprised of public roads. Mining at Chain Valley Colliery predates the introduction of State or local environmental planning controls over mining. Development consent under Part 4 of the Environmental Planning & Assessment Act 1979 (EP&A Act) was not required due to provisions in the Lake Macquarie Local Environmental Plan 2004 and Wyong Local Environmental Plan 1991 (and their predecessors), which reflected the Environmental Planning & Assessment Model Provisions 1980, with the effect that consent was not required for development carried out on a mine for the purposes of a mine, and also due to similar provisions then in place under the Mining Act However, due to the introduction of Part 3A of the EP&A Act on 1 August 2005 and the related passage of both the former State Environmental Planning Policy (Major Development) 2005 and amendments to the Environmental Planning & Assessment Regulation 2000, the mine requires either development consent under Part 4 or project approval under Part 3A to continue operations after 31 March LakeCoal therefore lodged a project application under Part 3A in May 2009 seeking approval for continuation of mining operations for the projected life of the mine (approximately 21 years). However, due to the risk that it may not complete all necessary studies for the Environmental Assessment (EA) needed to support this application, LakeCoal also submitted a separate project application seeking approval of continuing mining operations in a much smaller area of the Fassifern Seam, known as Domains 1 & 2 and Parcel A (see Figures 2 and 4). This second project application covers 731 hectares (ha), or approximately 35% of the 2100 ha covered by Chain Valley s mining leases. It is this second application that is the subject of this assessment report. Domains 1 & 2 and Parcel A would provide LakeCoal with access to sufficient coal reserves to enable mining operations to continue for up to five years. The Department of Trade and Investment, Regional Infrastructure and Services (DTIRIS) has already approved Subsidence Management Plans (SMPs) for coal extraction in Domains 1 & 2 and Parcel A in April 2008 and May 2010 respectively. These SMPs govern the mining methods and the proportion of coal that is allowed to be extracted. These SMPs have considered matters such as resource recovery, mining safely beneath the waters of Lake Macquarie, predictions of subsidence effects and impacts and likely environmental consequences. The SMPs provide for protection of the Lake s foreshore and seagrass beds from subsidence impacts and for the protection of mine workers from risks associated with mining beneath tidal waters. If the requirement for development consent had not arisen, then these SMPs would have remained the principal means by which mining within Domains 1 & 2 and Parcel A would have been regulated by the Government. 4

7 Figure 2: Existing Mining Leases and Proposed Mining Areas 5

8 Figure 3: Pit Top Area and Infrastructure 6

9 2. PROPOSED PROJECT LakeCoal proposes to continue existing mining operations at the Chain Valley Colliery in Domains 1 & 2 and Parcel A (see Figures 2 and 4) within the Fassifern Seam as well as passive operations within other sections of the underground workings inside the project boundary (such as mine ventilation and personnel, materials and coal transport). Domains 1 & 2 and Parcel A are located entirely within the footprint of Lake Macquarie. LakeCoal is also seeking approval to increase the maximum amount of coal transported by road to 1.2 million tonnes per annum (Mtpa). The major components of the project are summarised in Table 1. The project is described in full in LakeCoal s EA, which is attached as Appendix 1. Table 1: Project Summary Aspect Summary Project Summary The project consists of: extracting up to 1.2 Mtpa of ROM coal per year from the Fassifern Seam until 2016, from existing mining leases; crushing coal at Chain Valley Colliery s CPP; transporting coal by public roads to the Port of Newcastle for export; transporting coal by public roads to Vales Point and Munmorah Power Station and other customers for domestic use; installation of upgraded ventilation fans at Summerland Point; and rehabilitating pit-top facilities, if the life of the mine is not extended by a subsequent approval. Mining and Mining undertaken as bord and pillar (first workings), and subsequent full and Reserves partial pillar extraction (second workings) using continuous miners, as well as the recently-introduced use of miniwall mining methods (second workings) with extracted panel widths up to 72 m; Extraction height up to 3.5 m, but roadways more generally 3.0 m in height; and Extraction of approximately 4.4 Mt of ROM coal in total. Mining Methods Parcel A continuation of first workings in the Fassifern Seam using bord and pillar extraction (ie first workings) only; and Domains 1 & 2 potential full extraction from the Fassifern Seam using a combination of full and partial pillar extraction and miniwall mining. Project Life Mining operations may continue for five years. Project Staging The project is a precursor to LakeCoal s associated project application to continue mining for approximately 21 years. Existing Surface The following existing surface facilities would continue to be utilised: Infrastructure personnel-and-materials drifts, ROM coal conveyor drift; upcast and downcast ventilation shafts; coal handling facilities for breaking, crushing, sizing and storing product coal; administration and workshop facilities; and water management infrastructure. Proposed Surface Installation and operation of upgraded ventilation fans. Infrastructure Coal Processing Screening and crushing of ROM coal at Chain Valley Colliery. Water Demand and Supply 105 megalitres per annum (MLpa) in water use, proposed to be drawn from Wyong Shire Council s potable water supply mains. Coal Reject No coal reject generated by the project. Management Hours of Operation Mining operations 24 hours a day, 7 days a week; and despatch of coal trucks limited to between 5.30 am and 5.30 pm. ROM Coal Transport Road transportation via public roads to the Port of Newcastle for export and to domestic industrial customers, including Vales Point and Munmorah Power Stations. Mine Access Existing road access from Construction Road. Rehabilitation Socio-Economic Benefits Employment Capital Investment Value Decommissioning of surface facilities and final rehabilitation following mine closure. At maximum production rates, up to $136 million annual sale value for coal; at average production rates, about $85 million annual sale value for coal; and LakeCoal would directly contribute up $42,000 each year to community projects and local infrastructure. Continued employment of 120 existing staff, as well as associated truck drivers. $25 million. 7

10 3. STATUTORY CONTEXT 3.1 Major Project The project was declared to be a major project under Part 3A of the EP&A Act because it constitutes development for the purposes of coal mining, and therefore met the criteria in clause 5 of Schedule 1 of the former State Environmental Planning Policy (Major Development) Part 3A of the EP&A Act, as in force immediately before its repeal on 1 October 2011 and as modified by Schedule 6A to the Act, continues to apply to the project application, since it is a transitional Part 3A project for the purposes of Schedule 6A. Consequently, the Minister for Planning and Infrastructure is the approval authority for the project application. However, the Deputy Director- General, Development Assessment and Systems Performance, may determine the project application under the Minister s delegation of 14 September 2011, as: there were less than 25 submissions in the nature of objections; and neither of the local Councils has objected to the application. 3.2 Permissibility The project is permissible with consent under the Lake Macquarie Local Environmental Plan 2004, Wyong Local Environmental Plan 1991 and State Environmental Planning Policy (Mining, Petroleum Production and Extractive Industries) 2007 (the Mining SEPP). The Mining SEPP prevails over these Local Environmental Plans to the extent of any inconsistency. Any zoning provision in either local environmental plan that would otherwise operate to prohibit the project consequently has no effect. 3.3 Other Approvals Under Section 75U of the EP&A Act, a number of other approvals have been integrated into the Part 3A approval process, and are not required to be separately obtained for the project. These include: authorisation to clear native vegetation under section 12 of the Native Vegetation Act 2003; permits under section 205 of the Fisheries Management Act 1994 for regulation of harm to seagrass beds; and certain water-related approvals under the Water Management Act Under section 75V of the EP&A Act, a number of further approvals are required to be obtained, but must be approved in a manner that is substantially consistent with any Part 3A approval for the project. These include: mining leases under the Mining Act 1992; bore licences under the Water Act 1912; approvals under the Mine Subsidence Act 1961 for improvement works within a Mine Subsidence District; and environmental protection licences (EPLs) under the Protection of the Environment Operations Act The Department has consulted with the relevant public authorities responsible for these other approvals (see Section 4), and considered the relevant issues relating to these approvals in its assessment of the project (see Section 5). These authorities support the project, subject to the imposition of suitable conditions of approval. 3.4 Exhibition and Notification Under Section 75H(3) of the EP&A Act, the Director-General is required to make the EA for a project application publicly available for at least 30 days. After accepting the EA for the project, the Department: made the EA publicly available from 15 July until 19 August 2011 (a period of 35 days); on the Department s website; and at the Department s Information Centre, Lake Macquarie Council s offices in Speers Point, Wyong Shire Council s offices in Wyong and at the office of the Nature Conservation Council of NSW; notified relevant State Government authorities and Lake Macquarie and Wyong Shire Councils by letter; and advertised the exhibition in the Lakes Mail on 21 July and 4 August

11 This satisfies the requirements in Section 75H(3) of the EP&A Act. During the assessment process, the Department also made a number of documents available on its website, including the project application; Preliminary Environmental Assessment; Director-General s environmental assessment requirements; the EA; public and agency submissions; and LakeCoal s Response to Submissions. 3.5 Environmental Planning Instruments Under Section 75I of the EP&A Act, the Director-General s report is required to include a copy of, or reference to, the provisions of any environmental planning instruments that substantially govern the carrying out of the project. The Department has considered LakeCoal s assessment of the project against the relevant provisions of several State Environmental Planning Policies and other environmental planning instruments, and carried out its own assessment of these matters (see Appendix 2). Based on this assessment, the Department is satisfied that none of the relevant instruments substantially govern the carrying out of this project. 3.6 Objectives of the EP&A Act The Minister s delegate should consider the objects of the EP&A Act when making decisions under the Act. The objects of most relevance to the decision on whether or not to approve the project are found in Section 5(a), (i), (ii), (vi) and (vii) of the Act. They are: (a) To encourage: i. the proper management, development and conservation of natural and artificial resources, including agricultural land, natural areas, forests, minerals, water, cities, towns and villages for the purpose of promoting the social and economic welfare of the community and a better environment, ii. the promotion and co-ordination of the orderly and economic use and development of land, vi. the protection of the environment, including the protection and conservation of native animals and plants, including threatened species, populations and ecological communities, and their habitats, and vii. ecologically sustainable development. The Department is satisfied that the project encourages the proper use of resources (Object 5(a)(i)) and the promotion of orderly and economic use of land (Object 5(a)(ii)), particularly as the project is a continuation of mining operations at an existing mine; is a permissible land use; would take place within existing mining leases; the subject coal resource is located adjacent to existing mining activities and power stations; and the project would make efficient use of existing mining facilities and infrastructure at Chain Valley Colliery. The encouragement of environmental protection (Object 5(a)(vi)) is considered in Section 5 of this report. Following this consideration, the Department is satisfied that the potential impacts of the project can be suitably mitigated or managed to ensure an acceptable level of environmental performance. The Department has also considered the encouragement of ecologically sustainable development (ESD) (Object 5(a)(vii)) during its assessment of the project application. 3.7 Statement of Compliance Under section 75I of the EP&A Act, the Director-General s report is required to include a statement relating to compliance with the environmental assessment requirements of the project. The Department is satisfied that the environmental assessment requirements have been complied with. 4. CONSULTATION During the exhibition period, the Department received a total of 16 submissions on the project, from public agencies, special interest groups and the general community, comprising: Office of Environment and Heritage (OEH), part of the Department of Premier and Cabinet; Heritage Branch of OEH; 9

12 NSW Office of Water (NOW), part of the Department of Primary Industries; Roads and Traffic Authority, now part of Roads and Maritime Services (RMS); Division of Resources and Energy (DRE), part of DTIRIS; Mine Subsidence Board (MSB); Wyong Shire Council (WSC); Lake Macquarie City Council (LMCC); Newcastle City Council (NCC); two submissions from special interest groups (Mannering Park Community Precinct Committee (MPCPC) opposing the project and the Construction, Forestry, Mining and Energy Union (CFMEU) supporting the project); and four public submissions objecting and one supporting the proposed project. A copy of these submissions is provided in Appendix 3. LakeCoal has subsequently provided a formal response to the issues raised in the submissions. A copy of the response to submissions report is provided in Appendix 4. Since receiving LakeCoal s response to submissions, the Department has carried out further consultation with relevant public authorities, and incorporated their comments into the recommended conditions of approval where appropriate. A summary of the issues raised during the consultation process is provided below. 4.1 Public Authorities OEH initially did not support the project and raised a number of issues, including: insufficient justification of emissions factors used in air quality modelling; concern about the proposed minimal management of greenhouse gases emitted from the mine; the noise modelling methodology used; the management of on-site sewage and metals in minewater discharged to Lake Macquarie; and subsidence impacts on Lake Macquarie benthic communities. The majority of OEH s concerns were the result of insufficient information about the survey effort and justification of assumptions made in specialist assessments in the EA. LakeCoal then provided additional information in its Response to Submissions which enabled OEH to provide recommended conditions of approval. The Department has also undertaken further consultation with OEH in relation to these recommendations. The Heritage Branch of OEH considered that, as mining operations have occurred on the site since the 1960s, it is highly unlikely that any historic heritage remains within this landscape. NOW raised a number of issues in relation to the project, including: the licensing of groundwater volumes intercepted by mining operations; measures to maximise the beneficial re-use of water captured on the site (both surface and ground waters); and the investigation of measures to reduce potable water use. To address these concerns NOW recommended a number of conditions which the Department has considered in its assessment. RMS did not object to the project provided that LakeCoal addresses, in consultation with the relevant road authorities, the key improvement areas identified in the road safety audit included in the EA. These include upgrades to two intersections and enforcement of appropriate truck driver behaviour to avoid bunching and queuing of coal trucks. DRE supported the continuation of mining at Chain Valley Colliery and recommended that the Department include conditions requiring LakeCoal to update existing Mining Operation Plans. DRE indicated that all proposed mining operations would be contained within areas of the mine that already have approved SMPs and that the project is unlikely to cause additional subsidence impacts to those already assessed under those SMPs. MSB did not object to the project and advised that, as the mine is located within the Swansea / North Entrance Mine Subsidence District, any new surface improvement will require the approval of the MSB. 10

13 WSC raised a number of issues in relation to the project for which it recommended conditions. These issues included: management, monitoring and licensing of surface and ground waters and potable water usage; indirect biodiversity impacts in regards to lighting, noise and dust; road transport of coal from the mine to the Port of Newcastle and Vales Point and Munmorah Power Stations, including impacts to Ruttleys Road; rectification of deficiencies identified in the road safety audit; and funding of road improvements by LakeCoal; noise impacts, including those associated with existing operations at the mine; and increasing the proposed levy on each tonne of coal produced to provide for community facilities in the Summerland Point, Gwandalan, Chain Valley and Mannering Park communities. LMCC did not object to the project but raised concerns about potential impacts associated with subsidence, on-site water management, and land use compatibility and social impacts. LMCC is particularly concerned about potential subsidence-related impacts to the water quality of Lake Macquarie and its associated ecosystems. It considered that impacts to seagrass beds could result from subsidence-related impacts such as increased wave erosion of shorelines and decreased light penetration caused by increased water depth. It also considered that LakeCoal should have provided improved detail on proposed surface water management of the car-park and surrounds and upstream water quality data. NCC raised no objection to the project, subject to adequate conditions of approval being imposed reflecting the conclusions of the EA. 4.2 General Public and Special Interest Groups The primary concern of the four public submissions and the MPCPC submission which objected to the proposal was the continuing transport of coal by public roads to the Port of Newcastle and the local power stations. A coal levy of $1/tonne was suggested in one submission. Other issues raised included: damage to local residents vehicles from coal trucks; spillage of coal to Ruttleys Road; WSC forced to fund maintenance of Ruttleys Road, following damage by coal trucks; Chain Valley Colliery not complying with the existing road transport protocol; environmental damage, and restrictions in public access, to the Crown land reserve adjacent to the mine s settling ponds; noxious weeds inadequately controlled on the site; incorrect location of a water sampling point; impact of coal dust on threatened species; impact on local amenity; and the inadequacy of the proposed voluntary planning agreement. One public submission and the CFMEU submission both supported the project on the basis of continuing employment and wealth for local communities. 5. ASSESSMENT 5.1 Subsidence Existing Mining Operations The three economically mineable coal seams at Chain Valley are, in order of increasing depth, the Wallarah, Great Northern and Fassifern Seams. Mining is currently undertaken in accordance with Clause 88 of the Coal Mines Health and Safety Regulation 2006 and Subsidence Management Plans (SMPs) approved by DRE. Three types of mining system are used: bord and pillar mining ( first workings ); full and partial pillar extraction ( second workings ); and miniwall mining (also a form of second workings ). First workings are undertaken by mining intersecting roadways or bords of 5.5 m width on a rectilinear pattern, thereby leaving a regular array of large blocks of coal or pillars between these 11

14 intersecting roadways. As these large pillars provide support for the overlying rock strata, negligible surface subsidence results from first workings. Where surface constraints allow, secondary extraction of the pillars is subsequently undertaken, with varying degrees of resultant surface subsidence. Full extraction is only undertaken in areas where a higher amount of surface subsidence can be tolerated. Through the appropriate design of secondary extraction panels, using either partial or full extraction of pillars, the amount of surface subsidence can be controlled. Secondary extraction (ie second workings) is substantially more productive than first workings and is essential to the profitable operation of Chain Valley. Miniwall mining (first introduced at Chain Valley in October 2011) involves the use of continuous miners to create a rectangular block of coal several hundred metres in length and up to 61 m in width. Specialised equipment (ie a small longwall shearer) is then used to cut coal back and forth across the short face of this panel in retreat, with the overlying rock strata then collapsing into the mined-out void once the coal has been extracted. This void would then be up to 72 m in width, counting the width of the two adjacent roadways. Planning as to which mining system to employ in a particular area is undertaken on the basis of relatively small areas called mining domains, which allow for day-to-day refinements to the mine plan reflecting operational experience. Mining operations in the vicinity of Lake Macquarie s shoreline have been closely controlled by DRE over the past 30 years to strictly limit the maximum vertical subsidence within a High Water Mark Subsidence Barrier (HWMSB) to 20 mm, which is the effective limit of measureable subsidence (given soil swell and other variables). Subsidence has been limited in this zone in order to protect the shores of Lake Macquarie from inundation. These guidelines are a regulatory response to past mininginduced damage to the shoreline and to adjacent waterfront homes, particularly at Chain Valley Bay in 1986 and shortly thereafter. This damage was not caused by Chain Valley Colliery and it should be noted that revised Guidelines for Mining under Foreshores of Tidal Lakes were developed in the early 1990s by the then Department of Mineral Resources. These guidelines have since been applied by DRE and its predecessors without a repeat of this unfortunate and unpredicted event. Potential Subsidence Impacts The EA includes a subsidence impact assessment (SIA), which includes: discussion and analysis of historical mining conditions at the mine and nearby mines; description of mining operations undertaken in accordance with the approved SMPs for Domains 1 and 2 and Parcel A; application of restrictions to mining operations within the existing High Water Mark Subsidence Barrier (HWMSB) and the existing Seagrass Protection Barrier; and assessment of subsidence impacts and management controls for second workings in Domains 1 & 2, and for first workings in Parcel A. Within the project area the maximum water depth within Lake Macquarie is 6.5 m, with varying sediment depths on the floor of the Lake of up to 10 m. The maximum depth to rock is about 20 m, and the thickness of rock above the roof of the Fassifern Seam is in the order of 175 to 185 m. Importantly, the relatively thick and strong Munmorah Conglomerate and Teralba Conglomerate geological units can act as spans over the mined-out voids, which limit the effects of subsidence in the overlying geological units and at the surface. The project proposes to mine only within the Fassifern Seam. In areas of proposed secondary extraction (ie Domains 1 & 2), no historical extraction has been undertaken in the overlying seams. Consequently, potential subsidence impacts should be assessed on a basis of single seam extraction, rather than multi seam extraction. SMPs have been approved by DRE for Domain 1 (October 2007) and Domain 2 (December 2009). These SMPs include parameters to ensure that the full extraction boundaries for Domains 1 and 2 are: wholly under the surface extents of Lake Macquarie; outside the confines of the HWMSB and Seagrass Protection Barrier; and not subject to previous mine workings in overlying coal seams. 12

15 Parcel A is also located almost entirely within the Lake s footprint (see Figure 4). Figure 4: Proposed Second Workings Panels and Buffer Zones 13

16 The indicative mine plan (shown in Figure 4) is based on these parameters with predicted subsidence levels shown in Figure 6. The maximum predicted vertical subsidence levels are: 20 mm in the HWMSB and Seagrass Protection Barrier; 360 mm in areas subject to miniwall mining; and 510 mm in areas subject to pillar extraction. With the completion of pillar extraction in Panel W6 in June 2011, all proposed pillar extraction has been completed in Domains 1 & 2. Accordingly, the maximum vertical subsidence predicted for the remaining mining is 360 mm, from extraction of the proposed miniwalls (M1 to M7 and M8 to M15). Consequently, no terrestrial natural, heritage or built feature should be affected by any mining-induced subsidence. As a result, the SIA only needs to consider subsidence impacts within a 35 angle of draw from the proposed second workings within Domains 1 & 2. The area of this potential impact is also entirely within the footprint of the Lake (see Figures 4 and 5). Protection of Seagrass Beds Regulators, mining companies and the community are well-aware of the importance of seagrass beds to aquatic health, biodiversity and fisheries productivity. Seagrass beds are commonly present in the shallow fringing waters of Lake Macquarie, including along the shorelines of Mannering Park and Summerland Point, which are adjacent to Domains 1 & 2. LakeCoal has surveyed and mapped these seagrass beds and established that they are densest toward the shore and gradually thin out lakewards until the edge of seagrass growth is encountered at a depth of about two metres below the low water mark (maximum depth recorded at m AHD). LakeCoal has set the width of its Seagrass Protection Barrier within the Fassifern Seam by an angle of draw (to the vertical) of 26.5 from the boundary of the lakeward extent of the seagrass bed to the seam (see Figure 5). The width of its HWMSB is defined by an angle of draw of 35 from the high water mark and the 2.44 m contour (see Figure 5). No second workings are proposed within either of these zones, and consequently surface subsidence within the seagrass beds or at the Lake foreshore is expected to be no more than 20 mm (see Figures 5 and 6). Figure 5: High Water Mark Subsidence and Seagrass Protection Barriers 14

17 Figure 6: Predicted vertical subsidence (dashed line represents the Lake shoreline and solid black line represents the boundary of the HWMSB and Seagrass Protection Barrier measurements in metres) 15

18 LakeCoal is currently required, as a condition of the SMPs in place for Domains 1 & 2, to prepare and implement a Seagrass Management Plan. This plan has been prepared in consultation with NSW Fisheries and DRE. It includes: collection of detailed seagrass community baseline data, including at control sites unaffected by mining; seagrass impact thresholds; a seagrass monitoring program; and a contingency protocol in the event of exceedances of the seagrass impact thresholds. The Department considers that the existing Seagrass Management Plan is an appropriate mechanism to gather and analyse data about seagrass beds and to alert LakeCoal and relevant authorities to any changes in seagrass distribution and health. It also believes that annual surveys should be undertaken to build on the existing database and that this information should then be made publicly available. Benthic Ecological Communities The project has the potential to adversely impact the environment as a result of subsidence-induced impacts to the floor of Lake Macquarie, all of which is defined as Key Fish Habitat under the Fisheries Management Act The extraction of miniwalls is predicted to subside the bed of Lake Macquarie by up to 360 mm. Maximum subsidence is predicted to occur mainly in areas of the lake with over 5 m of water depth. The effects on the benthic communities of the lake are not well-known, although the Department considers that, at depths in excess of 5 m, an increase of 360 mm in water depth is unlikely to greatly change environmental conditions, such as amount of light penetration, water temperature, nutrients or dissolved oxygen levels. It should be noted that 360 mm is substantially less than the tidal range in Lake Macquarie. The EA presents the outcomes of sampling 17 sites for benthic communities and the depth of the Lake at 150 data points. OEH proposed that LakeCoal be required to conduct further investigations into the benthic communities above Domains 1 & 2 and the effects on them of increased depth of water and resultant reduced light and that these studies should be augmented by bathymetric surveys of the Lake s bed. The Department supports OEH s recommendations for further investigations into benthic communities, light penetration of the Lake s waters and the use of bathymetric surveys as a means to assess the impacts of mining on the bed of the Lake. However, the existing database is sufficient to recommend approval of continued mining, while also providing a base for future improved and targeted surveys. In October 2011, the mine commenced production of coal from miniwall operations. As the mine relies on secondary extraction to be economically viable, halting miniwall mining operations at this time would cause severe economic hardship and organisational disruption. If mining were to be restricted to first workings only until the recommended surveys are completed, miniwall mining equipment would be left idle and a new mine plan would be required that would include out-of-sequence first workings. The initial miniwalls to be mined (M1 to M7) are located in the northern portion of Domain 2, where water depths are greater than 6 m. If LakeCoal uses bathymetric and benthic surveys to investigate the effects of these initial miniwalls, the database of subsidence effects will be considerably expanded prior to any miniwall mining occurring in Domain 1, where the lake is shallower. This would allow for any adjustments to be made, such as re-design of the width of mining faces, to control or limit the amount of subsidence for areas possibly more susceptible to changes in the depth of water. The Department agrees with OEH and LMCC that the impacts of subsidence on benthic communities should be fully investigated and has recommended a condition of approval that requires LakeCoal to undertake on-going investigations of the nature of the benthic communities in this part of Lake Macquarie and to establish the impacts, if any, of mining on benthic communities. The Department has recommended conditions including performance measures to require that subsidence impacts do not exceed minor environmental consequences for benthic communities. The Department also proposes that LakeCoal develop a Benthic Communities Management Plan, which would include: surveys of the lake bed to enable contours to be produced and changes in depth following subsidence to be accurately measured; 16

19 benthic species surveys within Domains 1 & 2, as well as control sites outside the mining area (at similar depths) to establish baseline data on species number and composition within the communities; development of a model to predict likely impact of increased depth and associated subsidence impacts and effects, including but not limited to light reduction and sediment disturbance, on benthic species number and benthic communities composition, incorporating the survey data collected; and a program of ongoing seasonal monitoring of benthic species in both control and impact sites. The Department is satisfied that the recommended conditions would appropriately protect benthic communities in Lake Macquarie. Other Potential Impacts OEH and LMCC raised other subsidence-related issues, including that insufficient data was provided in the EA on potential subsidence-related impacts to wave energy and shoreline erosion. The Department does not anticipate that the mining methods and limited surface subsidence proposed would lead to significant changes in the hydrology of Lake Macquarie (eg currents, tidal flows, sites of erosion and deposition). Many of these factors are subject to significant degrees of natural variation, depending on tides, rainfall, droughts and sediment input to the lake. Nonetheless, these factors would have to be taken into account under the proposed benthic communities performance measures and Benthic Communities Management Plan. Potential risks of subsidence impacts for Aboriginal heritage are considered in Section 5.6 below. Conclusion Both the Department and DRE are satisfied that LakeCoal s subsidence predictions are well-founded, but believe that the company should be required to monitor and validate these predictions over the life of the mine as well as the health and distribution of seagrass beds and benthic communities and to undertake bathymetric surveys of the lake bed potentially affected by miniwall mining operations. The Department has recommended conditions of approval requiring LakeCoal to prepare an Extraction Plan which would include: detailed plans of existing and proposed first and second workings; detailed performance indicators for each of the subsidence impact performance measures listed in Table 2 below; measures to ensure compliance with the performance measures in Table 2 and remediation of any subsidence impacts and environmental consequences; procedures for baseline data collection; a subsidence monitoring program, including bathymetric surveys (to validate subsidence predictions); a Benthic Communities Management Plan; a Seagrass Management Plan; and a Spontaneous Combustion Management Plan. Table 2: Recommended Subsidence Impact Performance Measures Biodiversity Threatened species, populations or their habitats and endangered ecological communities Negligible impact or environmental consequences. Negligible environmental consequences including: negligible change in the size and distribution of seagrass beds; Seagrass beds negligible change in the functioning of seagrass beds; and negligible change to the composition or distribution of seagrass species within seagrass beds. Benthic communities Minor environmental consequences, including minor changes to species composition and/or distribution. Built Features Public infrastructure (including sewage pipes; power and telecommunications cables) Always safe. 17

20 Other built features (including jetties and boat moorings) Public Safety Public Safety. Serviceability should be maintained wherever practicable. Loss of serviceability must be fully compensated. Damage must be fully repaired, replaced or fully compensated. Negligible additional risk. 5.2 Traffic and Transport All coal produced at the Chain Valley Colliery is transported by truck on public roads to either the Port of Newcastle (55%) or to domestic customers, almost exclusively Vales Point and Munmorah Power Stations (see Figure 1). A small quantity of coal is dispatched to other domestic customers (approximately 5,500 tonnes in 2010). Considerable public angst has been generated by road transport of Chain Valley s coal over the past three to four years in particular, due to: safety concerns about heavy trucks mixing / merging with local traffic; spillage of coal to roadways, and resultant dust emissions and damage to vehicles; overloading of trucks, resulting in several of the mine s trucking contractors being fined by the RMS; damage to local roads; inconvenience and delays caused by trucks either queuing at traffic lights or travelling in convoys ; and noise generated by trucks. In addition, the State Government has a longstanding policy of requiring coal to be transported by means other than public roads, wherever it is reasonable and feasible to do so. The EA presented a detailed economic analysis of potential alternative coal haulage options, including the use of conveyors, and the combined use of conveyors and rail transport. Some of the assumptions (such as limited availability of train paths and slow train loading times) on which LakeCoal s analysis is based have been questioned, with some justification, in a public submission. However, even assuming that sufficient train paths are available and trains were to be loaded in half the stated time, the Department considers that LakeCoal has demonstrated that, in most circumstances, public road transport is the only coal transport option currently viable. The potential exception to this is the transport of coal to the adjacent Vales Point Power Station, which has historically used conveyors and for which it is possible to utilise private roads. LakeCoal has publicly stated that, as part of its separate application to extend mining operations by 21 years, it will undertake studies into the feasibility of utilising the Vales Point Power Station coal unloader to load coal onto trains for transport to Newcastle. The Department welcomes this approach, while accepting that the required capital expenditure for such a facility would render this proposal uneconomic in terms of the five year project life of the current application. The Department has for many years implemented Government policy aimed at reducing or eliminating the transport of substantial quantities of coal on public roads. Given the proposed 5-year timeframe of the proposed approval, the Department has recommended a condition that requires LakeCoal to provide a report for approval by the Director-General describing reasonable and feasible options to reduce or eliminate the use of public roads to transport coal from the mine. To ensure that LakeCoal remains vigilant to opportunities of reducing truck numbers on roads, LakeCoal would be required to conduct, and report on, such a study every two years. The Department also expects that the Chain Valley life-of-mine project application will address every available opportunity to reduce or eliminate the existing road transport of coal to the Port of Newcastle. LakeCoal currently dispatches up to 260 laden coal trucks from the mine on weekdays between 5.30 am and 5.30 pm. These timeframes allow it to deliver coal to Port Waratah Coal Services between 6.30 am and 6.30 pm. All analysis of traffic volumes and intersection capacity provided in the EA are based on trucking operations being restricted to these hours. 18

21 LakeCoal undertook an assessment of the capacity of the coal haulage routes and intersections to deal with current mine-generated traffic and an increase in maximum laden truck movements from 260 to 270 for any day. The analysis demonstrates that current and projected levels of service and queuing times for roads and intersections are currently at a high standard and would not significantly alter as a result of the project. Currently trucking of coal is managed by an existing Transport Protocol (developed by the then NSW Planning) which was attached by the then Department of Mineral Resources (now DRE) to the mine s mining lease (in the absence of the mine holding or requiring a development consent at that time). The Department s recommended conditions require LakeCoal to develop a completely revised, updated and comprehensive Protocol. This would therefore be an instrument required and regulated under the project approval. The new Protocol must be prepared in consultation with RMS and relevant Councils and has been designed to minimise trucking impacts, safety concerns identified along the route, improve driver behaviour and to address the community s concerns. A Road Safety Audit (RSA) concluded that the routes posed no significant safety concerns that should lead to restrictions on coal transport operations. However, the RSA identified the following four key road safety improvements: improvements to the intersection of Construction and Ruttleys Roads (signage, line marking, kerbing, refurbishment of raised pavement markers, removal of silt build-up, repair of damaged safety barrier and improved seal of a left-turn slip lane); improvements to driver behaviour (elimination of lane straddling at intersections); elimination of trucks arriving in groups at the Sparks Road interchange; and improvements to access to and from Port Waratah Coal Services site at Newcastle. In addition, the RSA identified an intersection with poor sight distances at Mayfield West and deterioration of the road pavement at a number of locations, particularly along Ruttleys Road. In response to the concerns identified in the RSA regarding the intersection of Construction Road / Ruttleys Road in October 2011, LakeCoal re-appraised its transport options to Vales Point Power Station. LakeCoal commenced a trial of using private roads only for both delivery and return truck journeys. This has eliminated the former practice of laden coal trucks exiting Construction Road by way of a right-turn across traffic streams into Ruttleys Road and another right-turn from Ruttleys Road to deliver coal to the power station s coal stockpile. The Department is supportive of this action as it has reduced truck movements at the Construction Road / Ruttleys Road intersection by 25-40%, with resultant improvements to road safety and reduction in wear and tear of the intersection s road surface. To further mitigate impacts to the Construction Road / Ruttleys Road intersection, the Department has proposed conditions requiring LakeCoal to upgrade the Construction Road / Ruttleys Road intersection in general accordance with the recommendations within the RSA, unless the Director-General directs otherwise. This reserve power reflects the fact that a full upgrade requires the concurrence and co-operation of Delta Electricity, which owns Construction Road. The Department expects LakeCoal to use its best endeavours to implement all elements of the upgrade. WSC advocated strongly for LakeCoal to be required to undertake an additional RSA and geotechnical investigation of the Construction Road / Ruttleys Road intersection, a dilapidation study of Ruttleys Road and for LakeCoal to be responsible for any works recommended by these studies. To address Council s concerns the Department has recommended conditions of approval that require LakeCoal to proportionately contribute to the maintenance of both Ruttleys Road and Scenic Drive 1 (local roads maintained by WSC). These road maintenance agreements must take into consideration dilapidation reports prepared at LakeCoal s cost. If LakeCoal and Council cannot agree to the terms of the agreements or their implementation, then the matter is to be settled by a decision by the Director- General. Conclusion The Department considers that the overall standard of road safety and road conditions should be improved, to limit the potential traffic and road safety impacts of continued trucking of coal from Chain Valley, and has recommended conditions of approval that require LakeCoal to: 1 Scenic Drive is the road used for delivery of coal to Munmorah Power Station. 19

22 upgrade the Construction Road / Ruttleys Road intersection by addressing the deficiencies identified in the RSA; include a new revised and comprehensive Transport Protocol to address improvements in driver behaviour and truck management identified in the RSA and alert drivers to the poor sight distances at the intersection at Mayfield West; enter into an agreement with WSC to maintain, in proportion to the wear and tear caused by coal trucks, those portions of Ruttleys Road and Scenic Drive used for coal transport; and bear the cost of unannounced, independent road transport audits to regularly report on LakeCoal s compliance with road transport conditions of approval. 5.3 Water Resources Surface Water Mining operations at Chain Valley are undertaken in accordance with a water management system with established processes for clean water and dirty water management. The dirty water management system includes an oil/water separator and a series of 13 pollution control ponds. These ponds discharge from a single point to an unnamed creek which then flows into Lake Macquarie. On three occasions in 2009, during works associated with the ponds, total suspended solids (TSS) levels have exceeded the EPL criteria. At other times, concentrations of cobalt, copper, mercury, nickel and silver have exceeded the relevant ANZECC water quality guidelines. Water sampling within Lake Macquarie has revealed concentrations of copper, zinc and phosphorus in excess of the relevant guidelines. LakeCoal has identified it could improve management of stormwater draining from its car park and entry road areas. However, more importantly, the Department considers that the mine s use of a septic trench system for treatment of sewage and wastewater generated by its 120-strong workforce is not best practice. In the Department s opinion, several feasible alternative treatment options are available to LakeCoal, such as piping sewage for treatment at the nearby Chain Valley Waste Water Treatment works operated by WSC or installation of a site-based sewage treatment plant. Improvements to sewage treatment would reduce the amount of nutrients that currently find their way into the Lake from the site. The high level of nutrients in the Lake is largely responsible for decreases in light penetration of the water column, which in turn, impacts on the Lake s biodiversity. Reduction in nutrient levels from site based runoff may counteract (or even exceed) any impact on light penetration associated with subsidence. Accordingly, the Department has recommended conditions of approval requiring LakeCoal to: improve treatment and management of wastewater; improve management of stormwater runoff; and investigate the source of any contaminants in water discharged from the site that are in excess of relevant water quality guidelines. Water Balance The water balance assessment determined that Chain Valley would need to increase its use of potable water from the WSC water supply from the existing 72 MLpa to 105 MLpa, due to the need to use high quality water in the hydraulics of the miniwall mining system. LakeCoal has committed to undertaking a potable water use audit to identify any savings it can make and to install rainwater collection tanks to harvest potable water from roofs of offices and workshops. LakeCoal has commenced negotiations with WSC to provide an increased volume of potable water. The water balance indicated that the dominant source of water discharged from the site is groundwater intercepted during mining operations and pumped to the surface. Net groundwater make is about 2,800 MLpa (or 7.8 ML/day), although LakeCoal expects that less groundwater would be encountered by its mining operations in the Fassifern Seam (about 7.1 ML/day). LakeCoal is confident that it would not exceed the discharge limit of ML/day under its existing EPL. Groundwater Historical mining operations at, and in the vicinity of, Chain Valley Colliery have largely depressurised the coal seam aquifers within the Wallarah, Great Northern and Fassifern Seams. Consequently, the proposed underground workings within the Fassifern Seam would only incrementally extend the area of depressurisation. 20

23 Subsidence-induced fracturing has the potential to cause increased inflows to mine workings, should these fractures extend to overlying aquifers or to the sediments underlying Lake Macquarie. The EA concludes that vertical cracking should not extend beyond 65 to 115 m (largely due to the narrow 71 m width of the miniwall voids, coupled with the spanning effect of the conglomerate units) and that aquifers or water bodies greater than 115 m above the mine workings should not be impacted. As the mine workings at Chain Valley are 180 m below the lake bed sediments, there should be no connection to Lake Macquarie, this also being an important safety consideration for mine workers. Seventeen groundwater bores are located within a 5 km radius of the site. All bores are situated in geological strata well above the expected vertical limit of subsidence impacts. They are also low yielding and mainly used for stock and domestic purposes. The Department is satisfied that groundwater users are unlikely to be impacted by the project. No groundwater dependent ecosystems were identified within the project area. Mining operations over the last 60 years at Chain Valley and a number of adjacent and nearby collieries have resulted in widespread impacts to the regional groundwater regime. The incremental impacts as a result of continued mining at Chain Valley Colliery are considered negligible, with no adverse impact predicted for groundwater users or groundwater dependent ecosystems. 5.4 Noise The Noise Impact Assessment (NIA) contained in the EA did not fully assess the noise impacts of the proposal. However, LakeCoal s Response to Submissions contained a revised NIA prepared in accordance with OEH s Industrial Noise Policy (INP). Where issues relating to noise are not addressed in the INP, such as sleep disturbance, the revised NIA references the Interim Construction Noise Guidelines and the Environmental Criteria for Road Traffic Noise. Chain Valley is an existing mine which has been operating for at least 45 years. The key contributors to noise emissions from the Colliery are the mine s surface and ventilation facilities. Underground mining operations make no contribution to noise levels for local residents. Chain Valley Colliery is but one contributing noise source in the area, with Vales Point Power Station and Mannering Colliery being located to the west and south, respectively, of the surface facilities. Operational Noise The NIA included the results of background noise monitoring undertaken in two of the nearest residential areas; Mannering Park to the northwest of the surface facilities, and Chain Valley Bay to the east (see Figure 7) which is also considered representative of the noise climate of the residential areas of Kingfisher Shores and Summerland Point (see Table 3). A key feature of Chain Valley Colliery s operations is its road haulage of coal between 5.30 am and 5.30 pm. With the time taken to prepare for truck loading operations, increased activity occurs at the site from 5.00 am. The NIA assessment has, in accordance with the INP, considered a morning shoulder period from 5.00 to 7.00 am. Operational noise levels from the surface facilities are predicted to exceed the relevant night-time criterion for most of Kingfisher Shores under adverse inversion conditions and to exceed the relevant criteria during all periods at residences located closest to the surface facilities. Some of these exceedances are considered to be significant, and further action in the form of onsite noise mitigation measures is warranted. The NIA recommends that LakeCoal consider implementing particular onsite noise mitigation measures, such as fitting acoustic treatments to mobile equipment, installation of quiet rollers on surface conveyors and acoustic attenuation of the screener/shaker. LakeCoal has not committed to implement these measures, and it is not clear by how much they would reduce noise impacts at nearby residences. Noise emissions in the local area are dominated by a constant hum from the Vales Point Power Station and also occasional contributions from Mannering Colliery. If noise impacts from Chain Valley s operations were intruding on residential amenity on any regular basis, then the Department would expect local residents to have complained about it. However, the Department did not receive a single submission from the public complaining about noise from the Colliery s existing or proposed operations, and the Department is aware of only one previous formal complaint from the community about noise impacts. 21

24 Figure 7: Noise Receiver locations In accordance with the procedures of the INP for existing operations, the Department believes that the focus of management of noise impacts should be on ensuring that LakeCoal is implementing all reasonable and feasible onsite noise mitigation measures. The Department has recommended a condition that would require the noise emissions from Chain Valley to be regularly reviewed by a noise audit, and that LakeCoal should be required to implement any additional reasonable and feasible onsite noise mitigation measures identified in this process. Additionally, the Department expects that LakeCoal will continually seek ways and means to reduce its noise impacts until the long-term goals are achieved. The proposed noise management and monitoring measures should ensure that noise impacts of the continued operation of the Colliery are initially much the same as current and recent impacts; but with the potential to be significantly reduced over the next few years. 22

25 The Department also believes that LakeCoal should be required to comply with strict noise limits (see Table 4) at all surrounding properties, and to carry out regular monitoring of the Colliery s noise impacts against these limits. Table 4 also contains long-term noise goals for those locations where the predicted noise impacts are currently greater than the relevant noise criteria (see Table 3). Sleep Disturbance Noise emissions from the Colliery are predicted to comply with the relevant sleep disturbance goals and the Department has recommended sleep disturbance criteria limits determined in accordance with these goals. Road Traffic Noise The NIA found that road traffic noise generated by coal haulage trucks is predicted to comply with the relevant OEH road traffic noise criterion. The Department believes that a specific traffic noise criterion is not warranted for the project. Table 3: Background Noise Levels and Relevant INP Noise Criteria Location Period Measured Background Noise Levels (L A90 db(a)) Mannering Park Chain Valley Bay, Summerland Point, Kingfisher Shores Table 4: Recommended Noise Criteria Proposed Noise Criteria db(a) LAeq, 15min Day Evening Intrusive Noise Criteria (db(a)) Day Evening Night Day Evening Night Night 10pm -5am Shoulder 5 7 am Day Long-term Noise Goals db(a) LAeq, 15min Evening Night 10pm 7am R R R C C R R R R R R R R1-5, R7, R9, R16, R18, R Construction Noise The Department considers that the most effective manner in which to manage potential construction noise impacts from installing upgraded ventilation fans at Summerland Point is by the implementation of a site-specific Construction Noise Management Plan. The Department has recommended a condition of approval that requires such a plan to be prepared in accordance with OEH s Interim Construction Noise Guideline 2009 and approved prior to the commencement of any construction activities associated with the installation of the upgraded fans. Conclusion Existing potential intrusive noise impacts at Chain Valley are limited, and are expected to be reduced by measures proposed to be implemented in LakeCoal s Response to Submissions. However, the Department considers that they can be further reduced by the imposition of long-term noise goals and the implementation of additional best practice measures over time. The Department has recommended a comprehensive suite of noise management conditions, including strict noise emission 23

26 criteria, long-term noise goals and the development and implementation of a Noise Management Plan to manage noise emissions and ensure that noise impacts on all receivers are minimal. 5.5 Aboriginal Cultural Heritage LakeCoal used the Aboriginal cultural heritage assessment prepared for its Continuation of Mining project (see Section 1), for the current project. LakeCoal justified this on the basis that the area of mining for Domains 1 & 2 and Parcel A are wholly contained within the area of the wider investigations. This process drew criticism from some Aboriginal stakeholders (and OEH), notwithstanding that the assessment had been undertaken in consultation with registered Aboriginal stakeholders, since the consultation process had not been actively pursued in the year prior to the submission of the EA for the current project. LakeCoal addressed this criticism by undertaking a renewed round of consultation in September 2011 and included the results of this process in its Response to Submissions. As all mining will take place beneath the waters of Lake Macquarie, there is almost no prospect of physical impacts occurring to Aboriginal cultural heritage sites. Eleven sites, mostly shell middens and scarred trees, have been identified within the project area, but only one site ( ), a shell midden, is located within the area proposed to be mined. This site is on the shores of Lake Macquarie at Summerland Point and overlies Parcel A, where vertical subsidence is predicted to be less than 20 mm. It also lies within the HWMSB, which provides increased certainty that no measureable subsidence would be experienced at this site. However, in response to concerns expressed by some Aboriginal stakeholders about potential impacts of mining, LakeCoal has committed to monitoring the condition of this site over time, with the involvement of local Aboriginal stakeholders. The Department accepts this precautionary approach and has recommended conditions of approval that require LakeCoal to monitor this particular shell midden and, should unanticipated Aboriginal artefacts be found during proposed site works, such as the ventilation fans upgrade, to cease work and assess the find in consultation with local Aboriginal stakeholders and an archaeologist. The Department is satisfied that, with the implementation of these mitigation measures, the project is unlikely to have any physical impact on Aboriginal cultural heritage values. 5.6 Biodiversity The ecological assessment in the EA draws heavily on previous ecological surveys and ecological assessments undertaken for SMPs prepared for Domains 1 and 2, both for terrestrial and aquatic environments. The project would have negligible to no effect on the terrestrial environment. It involves, at most, the clearing of 0.07 ha of vegetation, for the upgrade of ventilation fans. The implementation of the HWMSB would protect all shoreline vegetation communities, such as mangroves, salt marshes and wetlands, and the shoreline itself from any subsidence impacts or environmental consequences. The effect of minewater discharges on the receiving waters of an unnamed creek and the adjacent Swamp Sclerophyll Floodplain Forest Endangered Ecological Community was raised as an issue by both the OEH and a local resident. The Department considers that these effects should be further investigated and has included a requirement for such studies within a Biodiversity Management Plan, which would also address impacts of the upgraded ventilation fans and matters such as weed control. The Department considers that biodiversity offsets are not required for the project due to the negligible direct vegetation disturbance impacts of the project and the protection provided to the foreshore and seagrass beds from subsidence impacts. 5.7 Other Issues The assessment raised several other issues that are considered in Table 5 below. Table 5: Assessment of Other Issues Aspect Consideration and Assessment Conclusion and Recommendations Soils As the project would only disturb about 0.07 ha of terrestrial land it has a minimal risk of impacting soils and causing erosion. This risk can be controlled by The Department is satisfied that specific conditions of approval are not required to manage the erosion risk 24

27 Air Quality Greenhouse Gas Rehabilitation Non- Aboriginal Heritage Hazards Visual the implementation of standard erosion control measures. Modelling in the EA s air quality impact assessment predicted that the project would not cause any additional exceedances of the 24 hour PM 10 criterion or any exceedances of the annual PM 10, TSP or deposited dust criteria at any sensitive receptor. The project would generate direct and indirect greenhouse gas emissions (GHGEs) that contribute to global warming and climate change. The EA includes a Greenhouse Gas Assessment (GGA) prepared in accordance with the Commonwealth Government s National Greenhouse Account Factors (2008). The GGA determined that the project would generate: Scope 1 emissions 537,000 tonnes per annum (tpa) of CO 2-e, an increase of approximately 202,000 tpa in comparison with existing operations; Scope 2 emissions 71,000 tpa of CO 2-e, an increase of approximately 27,000 tpa; and Scope 3 emissions 2,869,000 tpa of CO 2-e, an increase of approximately 1,304,000 tpa. The 609,000 tonnes of direct GHGEs from the project represent 0.37% of NSW s annual GHGEs. OEH considered that LakeCoal should be required to reduce its emissions of methane, contained within mine ventilation air emitted from the mine. The EA includes a life of mine and rehabilitation assessment. Chain Valley is planned to operate until 2016 before being placed on care and maintenance, should project approval for its continued operation not be in place at that time. The project is not expected to impact on non- Aboriginal heritage items. The EA included consideration of hazards, including hazardous materials management, bushfire and public safety. Chain Valley Colliery s surface facilities are located a significant distance away from local residences and do not impact on visual amenity. However, night lighting could cause a diffuse glow in the night sky. Waste The EA included an assessment of waste management which addressed the management of general wastes, scrap metal, sewage, waste oils/grease and hydrocarbon-contaminated water. LakeCoal operates a waste management system at the site which would continue to be implemented. The project would not generate coal rejects on site as all coal is sold as ROM coal. The Department is satisfied that LakeCoal s conceptual rehabilitation and final land use strategies are consistent with the relevant guidelines and are achievable. The Department is satisfied that no specific conditions relating to non- Aboriginal heritage are required. The Department is satisfied that the small risks to public safety from hazards can be appropriately managed. The Department is satisfied that the project would be unlikely to affect visual amenity in the local area. The Department has recommended a condition of approval that requires LakeCoal to minimise visual impacts, Socio- Economic The EA includes a socio-economic assessment which outlines community consultation undertaken for the project and considers the project s potential social and economic impacts. associated with this project. The Department has recommended conditions of approval requiring the project to: meet relevant air quality impact assessment criteria; implement best-practice dust management on site; establish an air quality monitoring network; and prepare and implement an Air Quality and Greenhouse Gas Management Plan. The Scope 3 GHGEs (which primarily result from the combustion of coal) would continue to occur even if the project were not to proceed, as the power stations supplied by the mine would source coal from other suppliers to fill their fuel needs. Accordingly, the continuation of mining at Chain Valley would not increase Scope 3 GHGEs above those that would otherwise occur. The Department has recommended conditions of approval which require LakeCoal to implement measures to minimise GHGEs from the project. particularly off-site lighting impacts. The Department has recommended conditions of approval requiring LakeCoal to minimise, monitor and manage wastes generated by the project. The Department is satisfied with the socio-economic assessment prepared for the project and considers that the continued operation of Chain Valley 25

28 The EA predicted that socio-economic benefits of the project are: continuation of 120 direct jobs, as well as truck drivers to deliver product coal from the mine; generation of between $85 and $136 million a year from coal sales; generation of export income from the sale of coal through the Port of Newcastle; provision of domestic coal to Vales Point and Munmorah Power Stations to provide for the energy requirements of the NSW population; royalties, State and local taxes, primarily for the State government; and contributions to community groups of up to $42,000 a year. Colliery would be of benefit to the local, regional and state economies. 6. RECOMMENDED CONDITIONS The Department has prepared recommended conditions of approval for the Chain Valley Colliery Domains 1 & 2 Continuation Project. These conditions are required to: prevent or minimise adverse impacts of the project; set standards and performance measures for acceptable environmental performance; ensure regular monitoring and reporting; and provide for the ongoing environmental management of the project. The recommended conditions address the management of mining-induced subsidence (including protection of seagrass beds, benthic ecological communities and the shoreline of Lake Macquarie); surface water and groundwater impacts; review, management and mitigation of existing noise impacts; air quality impacts and GHG emissions; environmental management systems and ongoing environmental monitoring; community consultation and complaints management; environmental performance audits; and mine closure planning. Particular attention has been paid to the on-going transport of coal by road to local power stations and the Port of Newcastle. The Department has recommended conditions requiring the review of the existing Road Transport Protocol, the implementation of regular independent road transport audits, upgrades to improve road safety and contributions to WSC to maintain local roads. LakeCoal does not object to the proposed conditions of approval. The Department believes these conditions reflect current best practice for the regulation of underground coal mines in NSW. 7. CONCLUSION LakeCoal is seeking project approval to extract up to 4.4 Mt of ROM coal at a rate of up to 1.2 Mtpa at the existing Chain Valley Colliery for up to five years, with the intention that an additional long-term project approval for the continued operation of the Colliery is obtained during that time. The Department has assessed the project application, EA, public and agency submissions, LakeCoal s Response to Submissions and additional information supplied in response to Departmental questions, and is satisfied that there is sufficient information available to determine the application. The expected subsidence impacts of up to 360 mm vertical subsidence from the continuation of the recently-adopted system of miniwall mining in the Fassifern Seam are considered by the Department to be minor. LakeCoal has committed to continue with existing subsidence and seagrass management plans which have been developed in conjunction with DRE to avoid potential risks to sensitive features such as seagrass beds and the shoreline of Lake Macquarie, where subsidence impacts are proposed to be limited to less than 20 mm. 26

29 Environ me ntal Assessmenf Repod Road transportation of coal is a sensitive issue for the general public, which is reflected by the Government's existing goal to remove coal trucks from public roads wherever reasonable and feasible. LakeCoal has begun to transport coal to the adjacent Vales Point Power Station using a route composed entirely of private roads. This has eliminated all right-turns by laden coal trucks entering Ruttleys Road and is considered by the Department to be an important improvement to road safety in the area. However, the Department accepts that transport by public road is the only current economically-feasible method to deliver coal to Munmorah Power Station and the Port of Newcastle under the application. The project would have minimal impacts on surface water, groundwater and biodiversity within the site, although improvement opportunities have been identified for the management of sewage effluent and on-site surface water run-off. The project is not expected to have any additional impact on surrounding residences, when compared to the current operations of the mine, and those which have occurred over the last 45 years. The Department has recommended conditions requiring LakeCoal to monitor air and noise emissions to control impacts, particularly for neighbouring residents and to pursue onsite noise attenuation measures, where reasonable and feasible to do so The Department's assessment has found that the project would provide for the continuation of an existing mining operation which would make use of existing facilities and would provide continued economic and social benefits. Overall, the Department considers that the project is in the public interest and should be approved subject to conditions. 8. RECOMMENDATION It is RECOMMENDED that the Deputy Director-General, Development Assessment and Systems Performance: o consider the findings and recommendations of this report;. approve the project application, subject to conditions under section 75J of lhe Environmental Planning and Assess ment Act 1 979; and;. sign the attached Project Approval (see Appendix 5). ú*,. [-^I Howard Reed A/D ((. r.ry' ni g and Industry Projects ú-t.tl Chris Wilson Executive Director Major Project Assessment l,lt, L5 Richard Pearson Deputy Director-General Development Assessment & Systems Performance Department of Planning and lnfrastructure 27