Hume Project: Sutton Forest Coal Exploration Licence EL 349. Groundwater Study

Transcription

1 Hume Project: Sutton Forest Coal Exploration Licence EL 349 Groundwater Study April 2014

2 Table of Contents 1. Groundwater Study: Background and Synopsis Southern Highlands Coal Action Group, 23 March Three Dimensional Groundwater Model of Hume Coal Prospect, Southern Highlands NSW Pells Consulting, 24 September Peer Review of 3D Groundwater Model (Revision 2) The University of New South Wales, Department of Environment and Civil Engineering, Water Research Laboratory, 13 December 2013

3 Groundwater Study: Background and Synopsis Executive Summary The Southern Highlands Coal Action Group (SHCAG) commissioned a groundwater study of the Hume Coal licence area (EL349) in Sutton Forest in the Southern Highlands of NSW. The licence area is within the Sydney water catchment. The study was undertaken by industry consultants and water scientists Dr. Philip Pells and Steven Pells of Pells Consulting and John Lee of Hydroilex Pty Ltd. The study was to assess the impact on the highly productive groundwater in the area of the proposed underground mine proposed by Hume Coal. The study produced a 3-dimensional model of the geology and the groundwater resource in the area. This enabled the calculation the inflow of groundwater into the mine under 3 conservative sets of assumptions. The base-case in the model predicts that the inflow of groundwater into the mine will be 13 billion litres (GL) per year 20 years after commencement of mining. It shows a range of between 4GL and 22GL per year. This is quite extreme and is due to the highly unusual geology in the area where the Hawkesbury sandstone aquifer sits right on top of the coal seam. Removal of the coal seam allows the aquifer to drain into the mine. The model estimates that the drawdown of the water table is estimated to be around 120 metres in all cases. This will far exceed the Minimal Harm Criteria of the NSW Government s Aquifer Interference Policy. The model also predicts that the drawdown impact will be felt over an area of over 150 to 200 square kilometers, reaching well outside the mine licence area. These findings are consistent with the real life experience at the Berrima Colliery owned by Boral Ltd that is approximately 4 to 6 kilometres away in an area of similar geology. Boral s own studies and a recent court case have shown that the groundwater has been drained in the area in and around the mine. Landowner s water bores are dry down to the mine level, 130metres underground. Hume Coal will be required to obtain a Water Licence to extract these huge volumes of water from the mine under the provisions of the Water Management Act Given that the irrigation water allocation to the entire Nepean district is 16.3GL and the licence area is but a small fraction of this, Hume s ability to obtain the water licence required is regarded as extremely doubtful. 1

4 1. Introduction The Southern Highlands Coal Action Group (SHCAG) is an organisation established more than three years ago and which now has over five thousand supporters. Our organisation opposes the development of an underground coalmine in the Hume Coal exploration licence EL349 in Sutton Forest, NSW. EL349 contains hundreds of properties including many listed heritage properties and features that could be affected by mining activity. A critical concern is the impact that this project will have on the groundwater resources in the area. Hume Coal has set up a Water Advisory Group (WAG), which includes some members of the community in However the information presented to this committee over the 24 months of its existence has been concerned primarily with process, and very little meaningful data has been forthcoming. This is despite Hume having drilled over 130 boreholes across the licence area. In addition they access to data from over two hundred exploration holes drilled by others since 1965 all on the government s DIGS database and hundreds of water bores. Given the lack of information and transparency from Hume, there is a growing concern that the Hume Coal WAG is merely a cosmetic exercise with no intention by Hume to provide meaningful information for consideration. Given these circumstances, SHCAG commissioned its own study of groundwater and related issues more than 12 months ago. This work is now complete and has been peer reviewed by the Water Research Laboratory of the University of NSW. Related background information on the district and a synopsis of the methodology and the results of the water study are the subject of this paper. 2. Current status of the Hume Project The project is still in the exploration phase with over 130 exploration boreholes having been drilled to date. Additionally, in late July 2013, Cockatoo Coal, who had ownership of 30% of the Hume Project, sold their share to their partner POSCO, a major South Korean steel producer, which is now the sole shareholder. As part of the sale process a paper was presented to Cockatoo shareholders, which contained a fairness opinion from the respected consultants Lonergan, Edwards and Associates Limited. This analysis, entitled Profile of Hume Coal Pty Limited provided the first formal insights as to the mine design. It appears that a prefeasibility study was completed by Cockatoo in March 2013 and from the details of this work that have been included in the Lonergan Edwards opinion, the preliminary mine design looks to be as 2

5 follows: The mine will use the long wall method with an assumed production level of 4.1 million tonnes per annum (MTA) over a 20-year life. However established reserves can support operations for a much greater period of time; The yield of saleable coal will be 78%, which infers that the mine will produce 900,000 tonnes per annum of coal washery tailings; The best estimate of the capital cost of the project at this time was $1044 million; and The surface facilities are likely to be located at the northern edge of the lease near the Hume highway, given the parameters disclosed for proximity to the Berrima rail siding and the Moss Vale power substation. The Hume Coal project is therefore a major industrial project and the release of this information has confirmed the need for the Southern Highlands community to have an independent view of the impact of the proposed mine on the local environment, of which the groundwater resource is a critical element. 3. Contributors to the SHCAG groundwater study The study reflects the efforts of three independent consultants, John Lee of Hydroilex Pty Ltd and Steven and Phillip Pells of Pells Consulting. Mr. Lee is a hydro geologist with several decades of experience in the coal industry and a broad portfolio of work in the Southern Highlands over the past 20 years. His work for the Study focused on the evaluation of bore logs and pumping data within, or adjacent to, the lease area, to enable cross sections correlating the geological and hydrogeological data to be developed. Dr. Phillip Pells is a geotechnical engineer, with extensive experience in analysis of the impact of mining developments. Steven Pells is a hydro geologist who specializes in the 3 dimensional modeling of groundwater systems. The team assembled data from a number of sources covering 333 individual actual drill holes and developed a numerical model to reflect the pre-mining groundwater situation. The model used Schlumberger s Visual Modflow TM software, an industry standard. Results were derived based on several assumed mining scenarios. 3

6 4. Structure of the groundwater model The three-dimensional groundwater model was established to assess probable impacts from underground coal mining in the Hume Coal prospect. It was necessary to design a groundwater model domain covering an area well beyond that of the lease with well-defined hydrogeological conditions at the boundaries. The boundaries of the model were therefore set about 10 km away from the locations of anticipated mining, and were chosen to be largely defined by surface hydraulic features: Wingecarribee River along the northern boundary; Wingecarribee and Fitzroy reservoirs along the eastern boundary; Black Bob s creek along the western boundary; and Bundanoon Creek ( the Grand Canyon ) along the southern boundary. Fig. 1 Relationship between EL349 and the model boundaries 4

7 5. Boundary conditions Rivers or creeks bound the perimeter of the chosen model terrain. The groundwater was assumed to reflect the river stage at these locations. A constant head boundary was assumed in accordance with these values to act around the perimeter of the model domain. Standing water levels (in metres below ground) as reported in the NSW Office of Water groundwater database, were obtained from 885 bores within and around the model domain. Contours of the water table were produced from this bore data and the perimeter river stages. These water level data were used irrespective of seasonal fluctuations but are taken as broadly representative of the regional water table. The recharge was chosen as a value, for each scenario, that resulted in a steady state water table elevation that resembled the water level elevation that had been calculated. 6. Interpreted Geology and Stratigraphy The stratigraphy of the area was derived from the following source data: 216 exploration boreholes by Austen & Butta and Bellambi Coal, drilled prior to 1982; 28 groundwater bores installed, logged and tested by Hydroilex. 82 selected groundwater bores on the NSW Office of Water (NOW) database; 7 boreholes in the Belanglo area drilled by Hume Coal; Contours and isopachs of stratigraphy prepared by McElroy Bryan and Associates, for Austen & Butta Ltd; Geological mapping by the geological Survey of NSW from 1973 and onwards; and Geological cross sections prepared by Hydroilex. Contours were produced by digital and hand contouring techniques, of: The top surface of the Wongawilli Seam; The base of the Hawkesbury Sandstone (in 90% of the bores the logging shows this to be the same as the top of the Wongawilli coal seam); and The base of the Wianamatta Shale. 5

8 7. Analysis of well logs and pumping test data John Lee of Hydroilex undertook this work as the first phase of the SHCAG groundwater study, and presented this material to the Hume Coal WAG at its March 2013 meeting. Using information he had developed over some years, he was able to construct 4 geological cross-sections over the lease area, 2 roughly N-S and the others E-W. To reflect the different qualities of the Hawkesbury sandstone at increasing depths, this stratum was divided into 3 horizons The C layer: an upper horizon of relatively high mass-permeability; The B layer: a central horizon of relatively low mass-permeability; and The A layer: a basal horizon of high permeability. The assumed permeability in the break-up of the Hawkesbury Sandstone layer is based on the well logs and the pumping tests that Mr. Lee had undertaken on these bores which consistently showed that the primary aquifers in the Hawkesbury sandstone resided within the section just above the coal seam, i.e. the A layer of the Hawkesbury sandstone. A reference table of hydrogeological and stratigraphic information and a chart showing the cross-sectional analysis performed by Mr. Lee are provided in Attachments 1 and Determination of Hydrogeological Parameters Using John Lee s categorization of the Hawkesbury sandstone into 3 stratigraphic units, a model of the overall geology was developed, based on a structure of 8 stratigraphic layers. In order of increasing depth they are: Wianamatta shale; Hawkesbury sandstone C; Hawkesbury sandstone B; Hawkesbury sandstone A; The Illawarra coal measures (including the target Wongawilli seam); Shoalhaven sequence B; Shoalhaven sequence A; and Base The Hydroilex pump-test transmissivity data were interpreted to generate equivalent horizontal coefficients of permeability. Values for the Hawkesbury sandstone and the other units were also referenced against data from the Southern coalfields and from tunneling projects in the greater Sydney region as published earlier by Pells Consulting. 6

9 9. Numerical Modelling The groundwater model was assembled using Visual Modflow TM software by Schlumberger. The stratigraphy used in the model assumed 8 layers, constructed according to the following parameters: Hawkesbury Sandstone unit is defined between contours of the base of the Wianamatta and top of the Illawarra Coal measures. Hawkesbury Sandstone subdivided into three layers: o Hawkesbury Sandstone Layer C taken 30% of the thickness of the total Hawkesbury Sandstone o Hawkesbury Sandstone Layer A taken as 25% of the thickness of the total Hawkesbury Sandstone o The remained comprising Hawkesbury Sandstone Layer B Base of the Shoalhaven B at 30 m below base of the Illawarra Coal measures Base of the Shoalhaven B at 100 m below base of the Illawarra Coal measures Base of the model at 0 m AHD. A finite difference grid was assembled over the model domain comprised cells approximately 270 m x 270 m around the periphery, but refined by a factor of 3 (i.e. approximately 90 m x 90 m) in the vicinity of the mine. 10. Modeling the impact of mining The mine plan that will be adopted by Hume Coal is unknown at this time, but some reasonable assumptions can be made. It was clear from coal isopach data; the locations of faults, and; coal quality data that mining would most likely include the 4.5 km 2 locations marked No. 1 to 4 in fig. 2. For modeling of the initial phase, area No.1 was used. An assumed larger mining area of 45 km 2 (shown with a grey outline in fig.2 was also incorporated in model simulations, which was considered representative of a 20 to 40 year mine life. The impact of the mining was modeled for a large number of cases with the rate of growth of the mine area in km/year estimated from assumptions on the Run-Of-Mine (ROM) coal yield range from 4.1 Mt/year (million tonnes) down to 1.2 Mt/year, and various estimates of coal seam thickness, coal density and extraction ratio. The study also assumed a range of hydraulic conductivity, a standard or most likely set of conditions and an upper and a lower set of assumptions. 7

10 Fig. 2 Assumed Mining Areas 11. Findings In summary, the study finds that at the completion of mining in area 1 (4.5 sq. km.), groundwater inflow into the mine for the standard set of hydraulic parameters would be around 11 megalitres/day (ML/d), with the rate at which the inflow rate builds up to this level depending on the rate of progress of the mine. This is shown in fig. 3 below, where R= rate of progress of the mine in sq. km./year. For the set of higher assumptions of hydraulic parameters the mine inflow rate at the completion of the 4.5 sq.km section is 18 ML/d, while with the lower set of assumptions the terminal inflow is around 5 ML/d. The cases were also run under a set of hydraulic conductivity assumptions that simulate the impact of the fracturing of the Hawkesbury sandstone that will occur as a result of the subsidence caused by the long wall mining. As expected the mine inflow increased when this factor was built in, with the inflow in the standard case rising by 2 ML/d to 13 ML/d and the inflows in the upper and lower cases rising by 3 ML/d and 0.5 ML/day respectively. 8

11 Instant Mine Inflow (ML/d) 10 R = 2.9 R = 1.2 R = 0.6 R = Mine Excavation Area (km 2 ) R = 2.9 R = 1.2 R = 0.6 R = 0.3 N o t e : S t a n d a rd v a l u e s o f h y d ra u l i c c o n d u c t iv i t y I n it i a l 4. 5 k m 2 m i n e o n l y R = 2.9 km 2 /year R = 1.2 km 2 /year R = 0.6 km 2 /year R = 0.3 km 2 /year Years Since Start of Mining Fig. 3 Mine Inflow at various rates of mine progress Longer term mining impact The study also examined the impact of the mine over a longer term, with the mined out area in this case being 45 sq. km. With fracturing of the Hawkesbury sandstone from the mining operation taken into account, the mine inflow at the end of the mine life using the standard set of hydraulic parameters was 35 ML/d. For the upper set of parameters the outcome was 58 ML/d and for the lower set of assumptions the inflow was 13 ML/d. The envelope of possible outcomes over the 3 sets of hydraulic conductivity settings and a high and low rate of mine advance (R= 2.9 sq. km./year and 1.2 sq. km./year) is shown in Fig. 4. 9

12 Drawdown of Water Table Drawdown was calculated across the model domain as the difference between the initial pre-mining groundwater condition, and the groundwater condition following mining. The model results show that the initial effects of depressurisation due to mining move very rapidly across the model domain, with effects observed at the northern and southern boundaries just 2 months after commencement of mining. Drawdown develops across the model region over time, as a result of both the ongoing dewatering, and the increasing mine area. In all cases, depressurisation above the mining region moves down to the mining seam a distance of about 120 metres. This means, for example, the standing water level of any bores located above the mine would decrease by this amount. The extent of drawdown decreases with distance from the mine. While the long-term drawdown is similar for each condition, the assumed hydraulic conductivity and storage values affect the rate at which drawdown occurs, and the mine inflow discharge under which it occurs. The study shows that on completion of the 45 sq. km mine, the water table drawdown of 120 metres extends well beyond the Hume Lease area extending in some situations to the model boundary- an area of approximately 180 square kilometres or more. 10

13 Fig. 4 Estimated inflows for a mine that ceases at 45 km 2 80 Upper values, 45 km 2 mine Standard values, 45 km 2 mine Lower values, 45 km 2 mine Upper forecast, R = 1.2 km 2 /year Lower forecast, R = 1.2 km 2 /year Upper forecast, R = 2.9 km 2 /year Lower forecast, R = 2.9 km 2 /year 60 Mine Inflow (ML/d) Years Since Start of Mining Mine Excavation Area (km 2 ) R = 2.9 R = 1.2 R = 2.9 km 2 /year R = 1.2 km 2 /year Years Since Start of Mining 11

14 12. Case Study: Berrima Colliery The Berrima Colliery lease adjoins the Hume Coal exploration lease and shares the same geology, that is the aquifer laden Hawkesbury Sandstone strata lying directly above the target Wongawilli coal seam. It is a small mine producing around 230 thousand tonnes/year of coal. This compares to the 4.1 million tonnes/year foreshadowed as the production from the proposed Hume mine. The mine has been in operation for 85 years, and on average drains 3 to 4 ML per day of mine inflow water to the Wingecarribee River. Recent legislative changes required Boral, owner of the mine, to apply for a permit for continued operation and as part of this process an Environmental Assessment of the operation was prepared. The groundwater report, prepared by consultants AGE, shows clearly the impact of the mine on the water table in the area. The Planning and Assessment Commission approved the continued operation of the mine and allowed an expansion to 460,000 tonnes/year, while at the same time expressing some misgivings about the adequacy of the data the Boral had presented. SHCAG appealed against this decision in the Land And Environment Court and was successful in winning the appeal. Boral subsequently had this result overturned on technical legal grounds and the original appeal is to be reheard later this year. However this rehearing will take place in circumstances where Boral has ceased production at the mine and placed it in care and maintenance mode. Attachments 5 and 6 show diagrams based on the AGE report showing the extent of the lowering of the water table in the mined area, and the area of depressurisation brought about by the mining operations more than 20 square kilometres. The full extent of the damage is not known because an adequate number of calibration bores are not in place. During the appeal, expert witnesses gave evidence on the state of groundwater in the mined area, and Boral s expert agreed under questioning that the aquifers above the coal seam had been largely dewatered as a result of the coal extraction. It was agreed that there might be sufficient groundwater below the coal seam for stock and domestic use, but that irrigation would not be feasible. Subsequent to the hearing Boral applied for permission to drill a borehole below the Wongawilli coal seam to provide water to a landowner whose existing bore had been impacted by mining (the Renehan Bore Project). This incident confirms the conclusions reached in the hearing, and in the AGE report, that wherever coal extraction has occurred in the Berrima lease, the water table has been essentially lowered to the coal seam. The Berrima mine uses the Bord and Pillar extraction method, which allows some scope for protection of sensitive areas from the subsidence that would 12

15 exacerbate the groundwater loss. Even so there has been some serious subsidence events and daily loss of groundwater into the mine. Hume Coal is proposing to use the Long wall method, which will ensure effective draining of the aquifers in the Sutton Forest area. The evidence from the Berrima mine, now tested in court, strongly supports the findings from the SHCAG water study of the Hume Coal area, and is a clear pointer to the impact on groundwater aquifers that will occur should the larger scale Hume mine go ahead. 13. Major hurdles for the Hume Project Water Licensing: The NSW Office of Water requires that all mining operations have a licence for their take of ground and surface water. Based on the mine inflow calculations developed in this study, a licence of between 4 to 22 GL per year will be required, with the set of most likely hydrogeological parameters yielding a mine inflow of 13 GL/year. Hume Coal has acquired some water rights through the properties they have purchased, but this would amount to less than 0.5 GL per year at this time. The Hume Coal Project is located in Area 1 of the Sydney Basin Nepean Water District, shown in Attachment 4. Area 1 represents approximately 30% of the entire Nepean district. The background document for the Water Sharing Plan for the Greater Metropolitan Region Groundwater Resources 2011 published February 25 th, 2011, records the total entitlement for licensed groundwater users in the entire Nepean district as 16.3 GL/year. The Nepean district currently has 285 licence holders, but this document goes on to note that the in Area 1, no new licences are being issued as the groundwater is considered to be fully allocated. In this area, water allocation can only be acquired by purchase from an existing licence holder. We do not know the allocation of the 16.3 GL/year groundwater entitlement between Nepean areas 1 and 2, but clearly Hume Coal will be required to acquire most if not all existing licences in area 1, even assuming the most favorable set of assumptions. The Aquifer Interference Policy: The Hume Project will be required to meet the requirements of this policy that was introduced by the NSW Government during As well as re-iterating the necessity of a licence for the groundwater extracted, the policy sets specific guidelines for permissible water drawdown that are totally incompatible with the aquifer impact of this mine demonstrated in the study. 13

16 In particular the AIP specifies a maximum water table draw down of 2 metres in highly productive groundwater systems, such as we have in the Southern Highlands. After 2 metres, make good provisions come into force, but with the SHCAG water study indicating that a draw down of 120 metres in the water table is a long-term inevitability inside and well beyond the Hume Coal mining area, make good is not a viable concept. The Federal EPBC Act Water Trigger : An amendment to the Environmental Protection and Biodiversity Conservation Act 1999 (the EPBC Act) passed through Federal Parliament in June The amendment puts into play the so-called water trigger which requires that the impacts of proposed CSG and large coal mining developments on water resources to be comprehensively assessed at the national level. The Hume Coal project will fall under this legislation. The amendment now permits the Federal Minister for the Environment to deal with water resource concerns as a standalone item and set conditions to ensure that significant impacts on a water resource are acceptable. All projects will be referred to the Federal Independent Expert Scientific Committee (IESC) for assessment. In reaching his decision, the Minister will take advice from the Independent Expert Scientific Committee into account. 14. Conclusions The SHCAG Water Study predicts that the Hume Coal proposal will require a Water License to extract between 4GL and 22GL of water a year from the mine under the provisions of the Water Management Act With the overall allocation to the Nepean district for irrigation purposes is 16.3GL, and with Area 1 (in which the project sits) forming only 30% by area of the district, and additional irrigation bores being embargoed in this area, it does not appear feasible that Hume Coal will obtain sufficient water allocation to operate the proposed mine. The model demonstrates that the anticipated drawdown of irrigation bores in the vicinity of the mined area, and well beyond, will far exceed the minimal harm criteria of the Aquifer Interference Policy. This will be taken into to account in any decision to license mining activities. The impact of the water trigger under the EPBC Act is presently uncertain given the changing Federal political landscape. 14

17 15. Peer Review The structure of the groundwater model, and the conclusions of the report, has been peer reviewed by the Water Research Laboratory of the University of NSW. The reviewer, Mr. Doug Anderson, an acknowledged expert on groundwater issues locally and internationally, states in his findings that the numerical model and technical report demonstrate a strong appreciation for the geology and hydrogeology of the area and for effective numerical modeling practice. The peer review makes no recommendations for changes to the model or the final report. The peer review document is attached. 15

18 Attachment 1: Typical Bore Log showing strata and aquifer features 16

19 Attachment 2: Borehole cross sections across Licence Area Figure 14 Cross Section A Figure 15 Cross Section B Figure 16 Cross Section C Figure 17 Cross Section D 17

20 Attachment 3: Drawdown at end of mine life, 20 years, in plan and cross section 18

21 Attachment 4: Nepean Water Sharing Plan Area 19

22 Attachment 5: Berrima Colliery Impacted Area BERRIMA MINE WORKINGS & DEPRESSION OF HAWKESBURY AQUIFER PROPOSED&AREA& OF&EXPANSION& WATER&TABLE&& DEPRESSED& BY&>90m&& """"Impact" ~"20"km2" BERRIMA& LINE&OF& SECTION& 5"km" 20

23 Attachment 6: Berrima Colliery Groundwater Impact (Boral Environmental Assessment) BERRIMA''COLLIERY'CROSS'SECTION' NW SE HAWKESBURY SANDSTONE Water Table NOTE':'Depression'of'the'Water'Table'beneath'the'mine'' Source:(Based(on(Berrima(Colliery(EA(A5.(D(Fig.(7( 21