determination of the stratford extension project (ssd 4966 ... · the final assessment report...

COMMISSION SECRETARIAT Level 13, 301 George Street SYDNEY, NSW 2000 GPO BOX 3415, SYDNEY, NSW 2001 TELEPHONE (02) 9383 2100 FAX (02) 9299 9835 [email protected]

29 May 2015

Determination of the Stratford Extension Project (SSD 4966)

1. BACKGROUND 1.1 Site description The Stratford mine is operated by Stratford Coal Pty Limited, a subsidiary of Yancoal Australia Limited. The mine is located approximately 100 km north of Newcastle and 10 km south of Gloucester, within the Gloucester Local Government Area. Stratford is one of two mines in the Gloucester Valley region, though operations ceased in 2013. The other mine, Duralie Coal Mine, is located about 20 km south of the Stratford mine (see Figure 1). Both mines are owned by Yancoal Australia Limited. The southern portion of the Gloucester Valley is located within the Great Lakes Local Government Area. Whilst the project is not within the Great Lakes Local Government Area the haulage routes are located within this region. The Bucketts Way is the main road through Gloucester Valley which connects to the Pacific Highway, approximately 12km north of Raymond Terrace. From the Pacific Highway to Gloucester the road winds for approximately 80km through a number of small villages including Stroud, Craven and Stratford. Stratford mine is located on the eastern side of The Bucketts Way, near the villages of Stratford and Craven. 1.2 Existing Operations Stratford mining complex has been operating since 1995 under two Ministerial development consents, which allow extraction of up to 3.1 million tonnes per annum (Mtpa) of run-of-mine (ROM) coal. This includes up to 2.1 Mtpa from the Stratford pits and 1 Mtpa from Bowens Road North Open Cut (BRNOC), though neither of these pits are currently active. Open cut mining has previously been conducted in a number of other areas at the mining complex (Stratford Main, Roseville, Roseville Extended and Parkers/Bowens Road West Pits). These pits have either been filled and rehabilitated, or are used for waste rock and water storage. Coal from the mine is delivered by haul trucks from the pits to a coal pad, prior to being transferred to the Coal Handling and Preparation Plant (CHPP) for processing. The CHPP is approved to operate 24 hours a day, 7 days a week and has capacity to process up to 4.6 Mtpa of coal. When the mine was operating, the plant processed approximately 2.9 Mtpa. Product coal from the CHPP is stockpiled on site before being transported by rail to Newcastle for export. Loading and transporting of coal operates 24 hours a day. The CHPP facility also processes ROM coal from the nearby Duralie Coal Mine, which is blended with the Stratford coal to produce higher quality coking coal. The shuttle train from Duralie is not permitted to operate between 1.00am and 6.00am.

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Figure 1: Location map

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1.3 Commission’s Review (2014) On 6 December 2013 the then Minister for Planning and Infrastructure, the Honourable Brad Hazzard MP, requested the Planning Assessment Commission to conduct a review of the development application for the Stratford Extension Project. The Minister’s Terms of Reference were as follows:

1. Consider the Department of Planning and lnfrastructure's preliminary assessment of the merits of the Stratford Extension Project, including the EIS for the project, submissions, the response to submissions, and any other additional information provided to the Department during the assessment process or the PAC during the review process;

2. Review the merits of the Stratford Extension Project, paying particular attention to the potential night-time noise impacts of the project;

3. Hold public hearings during the review as soon as practicable after receiving the Department of Planning and lnfrastructure's preliminary assessment of the project; and

4. Submit its final report on the review within one month of holding the public hearings unless the Department of Planning and Infrastructure agrees otherwise.

The Commission conducted its Review in accordance with the Terms of Reference, which included holding a public hearing. The public hearing was held in Gloucester on 19 February 2014 and a total of 36 verbal submissions were made. The Commission finalised its Review Report in April 2014. The Commission found that the residual impacts of the project could be reduced to a low level if the recommendations contained in the report were adopted. These recommendations addressed the following issues:

Road funding contributions;

Noise impacts;

Compensation to neighbouring property owners;

Economic assessment of the project;

Biodiversity impacts and Yancoal’s proposed biodiversity offset strategy;

Air quality impacts;

Water;

Heritage concerns;

Improvements to environmental monitoring of the project;

Improvements to the draft conditions of consent, to improve clarity and certainty and addressing areas that were omitted; and

Areas for policy review by government agencies. The Commission’s conclusion was that if the recommended actions and/or commitments are in place, the project could be considered for approval (subject to conditions). 2. PROJECT APPLICATION The proposed extension seeks approval to extract up to 21.5 Mt of ROM coal over 11 years, at a rate of up to 2.6 Mtpa. The proposed extension is shown in Figure 2 and consists of three new mining areas:

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UAvon North PitU (located to the north east of Stratford Main Pit). It is proposed to develop the pit to the north-east of completed Stratford Main pit, which would yield approximately 4.3 Mt of ROM coal from the Avon seam. Following completion of mining, the void would be used for water storage and then for the co-disposal of fine and coarse CHPP rejects.

UStratford East Pit U(located to the south of Stratford Main Pit). It is proposed to develop the pit to the east and south east of the Stratford waste emplacement area, to produce approximately 9.6 Mt of ROM coal.

URoseville West Extension Pit U(located to the south west of BRNOC). It is proposed to extend open cut mining to the west and south of the existing pit, which would yield approximately 7.3 Mt of ROM coal. It is also proposed to excavate the previously backfilled Roseville Pit to further mine the Roseville seam.

A summary comparing the existing and proposed operations of the Stratford mine is included below: Table 1: Comparison of existing/proposed operations at Stratford (taken from the PAR)

Aspect Existing Proposed

Rate of production Up to 2.1 Mtpa (Stratford pits). Up to 1 Mtpa (BRNOC).

Up to 2.6 Mtpa.

Mine life Mining operations ceased in 2013. Processing and export to end in 2019.

Mining operations to end in 2025. Processing and export to end in 2025.

Hours of operation Seven days a week:

BRNOC: 7am - 7pm

Roseville Pit: 7am - 10pm

CHPP: 24 hours;

Loading and despatch of product by rail - 24 hours;

Unloading of coal from the Duralie shuttle train: 7am - 12 midnight.

Seven days per week:

No change to BRNOC

Roseville West Pit Extension: 7am - 6pm

Recovery of CHPP rejects for re-processing: 7am - 6pm

Avon North Open Cut: 24 hours

Stratford East Open Cut: 24 hours

No change to CHPP operation

No change to rail operation.

Coal trains Average of 2.5 product coal trains per day with a peak of 5 product coal trains per day.

Average of 2.5 product coal trains per day with a peak of 6 product coal trains per day.

Final voids Two final voids:

BRNOC final void

Stratford Main Pit final void

Three final voids:

Avon North Open Cut final void

Roseville West Pit Extension final void

Stratford East Open Cut final void.

Waste Rock Emplacement (including backfill)

Combination of in-pit and out-of-pit waste rock emplacement.

Continued placement of mine waste rock to in-pit and out-of-pit emplacements including:

extension of the Stratford Waste Emplacement until reaching a maximum elevation of 196 m AHD; and

extension of the Northern Waste Emplacement until reaching a maximum elevation of 165 m AHD.

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Figure 2: Existing and proposed mining areas

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3. DELEGATION TO THE COMMISSION

On 13 April 2015 the Deputy Secretary of Planning Services at the Department of Planning and Environment referred the Final Assessment Report to the Planning Assessment Commission for determination under the terms of the Minister’s delegation. Ms Lynelle Briggs AO, Chairperson of the Planning Assessment Commission, nominated Ms Robyn Kruk AM (chair), Mr Gordon Kirkby and Dr Andrew Stoeckel to constitute the Commission to determine the application. 4. SECRETARY’S ENVIRONMENTAL ASSESSMENT REPORT

In considering the justification for the modification, the Department’s assessment considers the conclusions and recommendations contained in the Commission’s Review. The key considerations relate to:

Economic benefits of the project;

Contributions to maintain and/or upgrade The Bucketts Way;

Biodiversity impacts and proposed mitigation measures;

Noise impacts;

Potential compensation for “lifestyle properties”; and

Air quality impacts.

The Final Assessment Report concluded that the significant and real economic benefits of the project deserve substantial weight in assessment of the application. The Department adopted 18 of the 31 recommendations contained in the Commission’s Review Report and has incorporated additional management, mitigation and reporting mechanisms in its recommended conditions of consent to address these issue. The Department has applied alternative mechanisms to address a number of other recommendations contained in the Review. It considers these recommendations improve outcomes for all parties, reflect recently updated government policy and address the Commission’s intentions made in the Review. The Department’s report concluded that it was satisfied that its recommended conditions were based on contemporary policy and best practice. It was satisfied that, on balance, the project is in the public interest and recommended it be approved, subject to the conditions outlined in the draft Development Consent. 5. SITE VISITS AND MEETINGS

5.1 Department of Planning and Environment

The Commission met with the Department on 23 April 2015 and 12 May 2015. The following matters were discussed:

Background to the application;

How the Commission’s recommendations contained in the Review have been addressed;

Noise impact, including night time rail noise;

Road issues, including existing obligations and upgrades;

Biodiversity offset strategy;

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Aboriginal heritage management zone;

Applicant’s Cost Benefit Analysis (CBA); and

Development contributions.

5.2 Applicant

The Commission met with Yancoal on 1 May 2015 for a briefing on the project and to undertake an inspection of the mine site and surrounding area (accompanied by the applicant). The company accepts the majority of the Department’s proposed conditions, with the exception of those outlined under Section 7 of this report. 5.3 Gloucester Shire Council

The Commission met with the General Manager of Gloucester Shire Council on 1 May 2015. The General Manager explained that in principle, the Council continues to support the expansion of the mine. However, it does have a number of concerns and believes that the Department’s recommended conditions do not adequately address the concerns raised by Council during the Review. These concerns remain and are summarised below:

The proposed contribution from the applicant towards the upgrade of The Bucketts Way is inadequate;

The proposed 24 hour operation and the impacts this may have on residents;

The size and future of the final voids;

Dust and noise impacts;

Water quality impacts on Stratford; and

Cumulative impacts of mining on the region.

5.4 Office of Environment and Heritage (OEH)

The Commission had a teleconference with officers from the OEH on 12 May 2015. The following points are a summary of the points made in this discussion:

The OEH is generally supportive of the Department’s recommended conditions of consent, including the Biodiversity Offset Strategy, timing of the Biodiversity Management Plan and tenure of conserved lands.

The OEH was under the impression that one of the properties surrounding the mine site (property 44) was part of the offset package. It is now aware that this is incorrect, which is unfortunate as this property would have added to habitat conservation. Notwithstanding this, the OEH is still satisfied with the Biodiversity Offset Strategy.

The OEH provided suggested wording to Condition 36, which relates to the establishment of Cabbage Gum Open Forest within the biodiversity offset area and biodiversity enhancement area.

5.5 Roads and Maritime Services (RMS)

The Commission had a teleconference with officers from the RMS on 12 May 2015. The following points are a summary of the points made during this discussion:

The RMS noted that its requests for road upgrades have not been included in the Department’s recommended conditions of consent. This includes the upgrade of The Bucketts Way / Wenham Cox Road intersection to minimum standards.

The RMS considers the Department’s recommended approach to road contributions is fair.

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The RMS has no immediate safety concern regarding the intersection of The Bucketts Way with the mine’s access road.

6. PUBLIC SUBMISSIONS The Commission invited those who previously made submissions or spoke at the Public Hearing to provide final comments on the application by 4 May 2015. A total of 43 submissions were received, all objecting to the project. The submissions were received from special interest groups, individuals, and government agencies. The key issues raised by the community fall under several different themes, which are summarised as follows: ULocal issues in proximity to the mine (potentially impacting land values, health and amenity)

Noise impacts, including low-frequency noise and rail noise.

24 hour operation (associated impacts and lack of economic justification).

Air quality impacts and consequent health impacts, including on children.

Contamination of domestic rainwater tanks.

Lifestyle and quality of life impacts. ULocal issues affecting the Gloucester Shire (infrastructure, environment and amenity)

Impact on Squirrel Glider population.

Impact on fauna and flora not adequately addressed in the biodiversity offset package.

Water quality and groundwater impacts.

Impact on The Buckett’s Way.

Small economic benefits, with a high cost to the community.

Implications on the “take or pay” coal transport contracts.

Final voids and risk of future salinity.

Loss of character to Gloucester Shire and surrounding area. UState issues

Overstatement of the benefits of the mine.

Poor history of mine rehabilitation.

Cumulative environmental impacts. UGlobal issues

Climate change impacts.

UIssues of process

Lack of confidence in the assessment process.

Disregard of the Commission’s recommendations.

Proposed conditions of consent do not address expected impacts.

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7. ADDITIONAL CORRESPONDENCE FROM THE APPLICANT On 28 April 2015, Yancoal sent the Commission correspondence to be considered as part of the assessment of the application. The correspondence refers to the Department’s recommended conditions of consent and requests a number of changes to conditions as outlined 3 below:

Delete Schedule 3, Condition 6(e) “Noise Management Plan

Delete Schedule 3, Condition 9 “Real Time Noise Monitoring Review”

Amend Schedule 3, Condition 40(a) “Biodiversity Management Plan” to provide flexibility with the timing.

Delete Schedule 3, Condition 50 “Transport Monitoring”. The Department and relevant agencies were given the opportunity to review to the applicant’s correspondence. The Commission’s consideration of these issues is contained in this report. 8. COMMISSION’S CONSIDERATION

The Commission has considered the application and reviewed the Department’s assessment report, associated documents and additional information provided by the Department and applicant. The Commission has also considered submissions made by the public and government agencies. The key issues considered as part of the assessment of this modification are addressed below: 8.1 Economic rationale Under Clause 12AA of the Mining SEPP, a consent authority must consider the significance of the resource that is the subject of a mining application. The consent authority must have regard to:

the economic benefits, both to the State and the region in which the development is proposed to be carried out, of developing the resource; and

any advice from the Department of Trade and Investment (DTI) as to the relative significance of the resource in comparison with other mineral resources across the State.

These criteria are considered below: UEconomic benefits of the mine In its Review Report, the Commission concluded that the benefits of the project are likely to be considerably less than those claimed by the applicant. The Commission recommended reduced levels of benefits to be used for further assessment, however noted that even the revised benefits would be optimistic. The Department has reconsidered all relevant information available and sought clarification about the economic impacts of the project from the applicant, the DTI and other relevant parties. DTI concludes that the project will deliver substantial benefits to Gloucester Shire, and to the economies of NSW and Australia; and that these benefits are actually greater than those recognised in the Review Report . In summary, the revised economic benefits generated by expansion of Stratford Mine include:

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Extraction of up to 13.8 million tonnes of thermal and coking coal at a maximum rate of 2.6 Mtpa until 2025.

The direct employment of 250 people.

The payment of $10 million in royalties on average or $106 million in total. This equates to $62 million on a Net Present Value (NPV) basis.

The Commission notes that the figures above are based on recent coal prices provided to the Department by the DTI, which are lower than those considered by the Commission as part of the Review. DTI has advised that NSW export coal prices are at the bottom of the price cycle and the Commission agrees with their conservative estimate that prices are expected to remain flat for the life of this project. The proposal is also expected to have indirect economic benefits. This includes approximately 250 flow-on employment opportunities in the region and NSW, making the employment gain in the order of 500 people. In correspondence to the Department (dated August 2014) the DTI states that it considered this figure to be conservative and fair. UAdvice from the Department of Trade and Investment The second consideration when determining the significance of the resource under the Mining SEPP is any advice received from the DTI. In August 2014, the DTI provided written advice to the Department regarding the economic significance of the resource. It advised that the significance of the project lies in its ability to maintain coal production from the existing mining complex and will add significantly to the total value of NSW exports. In addition, it noted the relationship between the Stratford and Duralie mines, which enables a higher valued export product to continue to be produced. UConclusion The Commission notes concern raised in the submissions that the economic benefits of the project have been overstated and do not fully account for the impact on the community and environment. It acknowledges that some of the key inputs into the applicant’s Cost Benefit Analysis have changed in recent times, including the value of the Australian dollar and coal prices. The Commission also notes that the state government is currently working on an agreed methodology to assess the economic costs and benefits of a project, and that this application is considered in this transitional period. Based on the updated advice provided by the DTI and the Department and its own review, the Commission accepts that the resource can be considered significant. Notwithstanding that there has been some adjustment to the direct and indirect impacts resulting from the proposal, overall the expansion of the mine would deliver a net benefit to the region and state of NSW. 8.2 The Bucketts Way UGloucester Shire Council’s position Gloucester Shire Council has previously made submissions to the Commission and Department regarding contributions payable by Yancoal towards The Bucketts Way. This issue was also discussed at the meeting between Council’s General Manager and the Commission on 1 May 2015. Council’s position is as follows:

There should be an annual contribution paid to Council by the applicant over 11 years (ie the life of the project).

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The contribution would go towards three x 10 year reseals of The Bucketts Way ($48,000/km), as well as a complete replacement of the pavement after 30 years $989,859/ km).

The contribution would be proportionate to the number of heavy vehicles entering and leaving the site as a percentage of total heavy traffic on The Bucketts Way.

The Commission’s Review Report supported Gloucester Shire Council’s methodology, as it was understood to result in a contribution comparable to that paid by Duralie’s contribution to Great Lakes Council (though the Department has since clarified that this is incorrect). UGreat Lakes Council’s position Following submission of the Environmental Impacts Statement (EIS), Great Lakes Council sought a total contribution of $176,456.81 for the eventual reconstruction of The Bucketts Way. This was calculated on the basis of six additional southbound truck movements from Stratford Mine over the life of the project. Great Lakes Council also sought a road maintenance payment of $11,785.08 per annum (based on the Duralie funding formula). UApplicant’s position The applicant considers the councils’ propositions to be unreasonable on the following basis:

It is not the applicant’s responsibility to fund the capital renewal of The Bucketts Way.

The request to provide funding for three reseals is unreasonable, as resealing would only be required once every 10 years.

Other heavy road users have not been required to contribute to either the reconstruction or maintenance of the Bucketts Way.

The road has not been adequately maintained by the Council and/or RMS in the past, which has contributed to its current condition.

No contribution is proposed to be paid to Great Lakes Council as maintenance is covered by Duralie’s contribution.

UDepartment’s position The Department has considered the differing views of the applicant and Gloucester Shire Council in its Final Assessment Report. In summary the Department concludes that it is unlikely that Gloucester Shire Council and/or Great Lakes Council will have the resources to upgrade The Bucketts Way. Therefore, the long-term reconstruction of the road is a capital works program that should be funded by the State and Commonwealth Governments. Annual contributions towards the maintenance of the road should be made to both Councils on an equitable basis.

The Department’s revised recommended approach to contributions towards The Bucketts Way is as follows:

Gloucester Shire Council: Apply the existing payments made by Duralie to the Stratford mine, on a per kilometre basis. This would result in a contribution of $1,175/km, which would deliver $22,619 per annum to Gloucester Shire Council, regardless of the percentage of heavy vehicle movements contributed by Yancoal.

Great Lakes Council: Apply a maintenance contribution based on the projected increase in truck movements from the south. This will deliver $10,771 per annum to Great Lakes Council, which is equivalent to the contribution currently received from Duralie (on a proportionate basis).

To provide improved data regarding the volume of heavy vehicles using The Bucketts Way, the Department has recommended that the applicant undertake ongoing monitoring and provide the data to Great Lakes Council and Gloucester Shire Councils (Condition 50).

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The Department does not support the inclusion of eventual replacement costs within the annual formula for road maintenance. UCommission’s view The Commission acknowledges that the councils and the applicant have conflicting views regarding the contributions payable towards the maintenance and repair of The Bucketts Way. The Commission also recognises that there is an absence of government policy relating to the contributions payable by mining companies for the use of local and regional roads. Having reconsidered this issue, the Commission is now of the view that road contributions should be based on the life of the Stratford Extension Project rather than previously-approved and/or future operations (which was the position adopted in the Review Report). It agrees with the Department that contributions should be allocated equitably to both councils; and supports the approach contained in Appendix 4 of the recommended conditions of consent. This is the fairest and most logical approach as both mines use The Bucketts Way, are similar in size and are owned by the same operator. It will also prevent double counting of vehicles visiting both Duralie and Stratford mine; and ensure consistency with the existing contributions paid by Duralie. The Commission also supports the inclusion of Condition 49, which will ensure accurate data is obtained regarding the volume of heavy vehicles associated with the mine. 8.3 Other road issues UUpgrade of intersections The RMS has requested that the applicant undertake intersection upgrades at The Bucketts Way / Wenham Cox Road and The Bucketts Way / Bowens Road. It is concerned that these requests are not included in the Department’s recommended conditions of consent. The Commission sough additional clarification from the Department regarding this issues (see Appendix 2). The Department does not agree that the applicant should be responsible for the intersection upgrades, on the basis that there is no nexus between the impacts of the project and the need for the upgrades. Traffic generated by the applicant is predicted to remain low and the project is not predicted to result in an increase in traffic volumes utilising Wenham Cox Road and Bowens Road. On this basis, the Commission agrees with the Department that the applicant should not be required to upgrade the intersections. The Commission notes that the RMS has no immediate safety concern regarding the intersection of The Bucketts Way with the mine’s access road. Notwithstanding this, the Department has recommended a condition requiring the upgrade of this intersection (Condition 46). The Commission supports this condition. UUpgrade of Wenham Cox Road The Review Report recommended a road maintenance contribution to be paid to Gloucester Shire Council to assist in the maintenance of Wenham Cox Road. The Department agrees with this recommendation and has included a suitable condition of consent (Condition 48), which is supported by the Commission. 8.4 Noise One of the key concerns raised in the public submissions regarding the project is noise impact to private properties. In its Review Report, the Commission provided 15 recommendation areas to address these concerns. The Department has endorsed 10 of

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these recommendations and included them in the recommended Conditions of Consent. The recommendations not adopted are addressed in Table 3 below:

Table 3: Commission’s noise recommendations not adopted in Department’s Conditions of Consent

Recommendation in Commission’s Review Report

Department’s Position

Industrial Noise Policy

If available, any outcome of the review of the Industrial Noise Policy (INP) relating to background noise levels in rural areas should be considered.

The review of the INP is not available. It is planned to be released for public comment sometime during 2015, but this timing is not certain.

Real-time monitoring The Proponent should conduct a review of the proposed real time monitoring and management system.

A condition of consent has been included.

There would be value in a comprehensive independent review of the reliability and accuracy of real time monitoring and management systems.

This is a policy recommendation, rather than one that can be acted upon in determining the Stratford Extension Project.

Negotiated agreements

Any existing negotiated agreements with landowners should be reviewed and updated to take account of the proposed project and any relevant conditions of approval.

The Department’s role is not to review private agreements between the applicant and neighbouring landowners. The noise limits have been retained for properties subject to negotiated agreements in accordance with the Voluntary Land Acquisition and Mitigation Policy. If a negotiated agreement is not in place or is ineffective, then the consent provides the project’s noise limits.

Acquisition and mitigation remedies

Land acquisition should be included as an option if the noise criteria are predicted to be exceeded on more than 25 percent of privately owned land.

The Department does not support this recommendation. Since the Review was finalised, the Voluntary Land Acquisition and Mitigation Policy has been adopted. The project has been reconsidered under the new policy. No vacant privately-owned properties (or privately-owned properties with a residence where the residence itself is unaffected) need to be referenced in the conditions of consent for noise or air quality measures.

Rail Noise Impacts General impacts

The frequency and duration of ‘peak’ rail movement periods should be clarified prior to determination, to allow an informed assessment of the night‐time impacts of this proposed change.

The frequency and duration of peak periods relate to a complex combination of factors and cannot be accurately predicted. The recommended conditions are based on the assessed maximum night-time rail movements over the standard nine hour night-time period. For all other times, train noise levels would be at lower levels than those assessed.

A condition should be added requiring regular reporting of the frequency and duration of night-time train movements.

A condition of consent has been included.

Impacts at the Village of Wards River

Yancoal should be required to undertake noise mitigation works at five residences predicted to be affected by cumulative rail noise. This condition would not apply if the EPA instead requires the Australian Rail Track Corporation (ARTC) to mitigate the noise at these residences.

The Department supports its previously-recommended conditions of consent relating to rail noise management, on the basis that the project would have only a marginal effect on rail noise impacts for residents living near the rail line. To ensure consistency and equality, management of the rail noise impacts at Wards River should be the responsibility of the EPA and the ARTC.

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The Commission has carefully considered the Department’s position on the noise recommendations outlined above. Overall it is satisfied that noise concerns associated with the proposal can be addressed through the recommended conditions of consent, which are based on the consistent application of government policy. Additional consideration has been given to the following matters: UNoise monitoring The Commission’s Review recommended sufficient noise monitoring be undertaken to enable recalibration of the model predictions on affected properties and to determine noise mitigation and acquisition rights of properties The Department’s preference is to measure noise levels and base actions on actual data and level of impact, rather than estimate impacts through noise modelling. This is reflected in Condition 6 of Schedule 3, which requires the noise model to be re-calibrated every two years. Condition 6 also provides for real-time noise monitoring to be used to guide on-site activities manage noise-generating impacts. The Commission accepts this position and is satisfied that Condition 6, along with the Voluntary Land Acquisition and Mitigation Policy, will adequately address noise impacts associated with the project. The approach in Condition 6(d) whereby real time noise monitoring is used to calibrate and validate real-time noise monitoring results with attended monitoring results over time is consistent with other contemporary PAC determinations. The Commission supports Yancoal’s request as it would be consistent with the conditions for Watermark (approved by the Commission on in January 2015). The Commission notes that the applicant has requested that Conditions 6(e) and 9 be deleted, on the basis that their intended management outcomes will equally be achieved by Condition 6(d). The Commission supports this request. U24 hour operations The Commission has carefully considered the proposed 24 hour operations and the potential impacts on surrounding properties. The applicant has explained that the 24 hour operation will result in reduced impact to these properties in the long-term, as it will reduce the life of the project. In addition, the applicant advised that restricting the hours would affect the operations of both Stratford and Duralie mines, as it would compromise the blending of coal between the mines. Having considered the Department’s Final Assessment Report, the Commission is satisfied with the Department’s recommended conditions of consent in relation to noise management. The Commission understands that the proposed 24 hour operations will only result in a marginal increase in noise, and considers this to be acceptable given the operational benefits associated with unrestricted hours. The Commission notes that the gazettal of the Voluntary Land Acquisition and Mitigation Policy in 2014 will govern noise impacts arising from the mining operations. 8.5 Potential compensation for “lifestyle properties” The Commission has received submissions both for and against its recommendation for compensation to “lifestyle properties”. The recommendation from the Review was that any impact above the Project Specific Noise Levels (PSNLs) at a “lifestyle property” be subject to mitigation, compensation or acquisition on request. A lifestyle property was defined as one acquired for residential purposes on the basis of amenity derived from its rural/natural setting, and not intended primarily for agricultural production.

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In its Final Assessment Report, the Department states that it does not support the inclusion of compensation measures for “lifestyle properties” within the conditions for consent. This approach has not been applied at any other mine in NSW and is not consistent with the recently adopted Voluntary Land Acquisition and Mitigation Policy. The Department explained that it would be difficult to distinguish between “lifestyle” and agricultural properties, or properties that may be both lifestyle and agricultural. Therefore, a compensation mechanism as proposed by the Commission is not justified. To ensure consistency with the assessment of mining applications in NSW, the Commission accepts that the amenity impacts associated with the project should be assessed under the Voluntary Land Acquisition and Mitigation Policy. Application of this policy to affected properties provides for:

The right of acquisition of request for Property Cr7

Mitigation of noise impacts at Property 44 and Property 60 (if they are not earlier purchased by Yancoal, in accordance with the Statement of Commitments).

Noise impacts at other properties (including Property 23) to be managed by best practice noise controls at the source during the period that the exceedances of the PSNL may potentially occur.

The Commission therefore agrees with the Department that there should not be discretionary compensation options for “lifestyle” properties. 8.6 Biodiversity The Commission notes that the Department and OEH are both satisfied with Yancoal’s proposed Biodiversity Offset Strategy (see Figure 3), subject to the recommended conditions of consent. The OEH has suggested some additional wording be added to Condition 36, to require more detailed consideration is given to the establishment of vegetation in the Biodiversity Offset Area and Biodiversity Enhancement Area. The Commission supports this amendment to Condition 36, which is provided in the Conclusion section of this report. The Commission’s Review Report raised some concern in relation to the biodiversity impacts of the proposal, which are addressed below: UImpact on Squirrel gliders The Review Report adopted a precautionary approach and gave particular consideration to the potential impacts of the project on the nearby Squirrel Glider colonies. This was based on the AMBS Consulting advice that the colonies had the potential to be significantly affected in the short term, due to the proposed removal of habitat and the temporary increase in isolation of known habitat areas. The Review Report concluded that

“…the Biodiversity Offset strategy be expanded to include additional area(s) containing known colonies of Squirrel Gliders and /or area(s) assessed as highly suitable for Squirrel Gliders and where there is a reasonable prospect of colonisation from one of more colonies of Squirrel Gliders”.

The Department has questioned the Commission’s position on Squirrel Gliders, on the basis that there is no strong evidentiary position to support it. Notwithstanding this, it agrees that risks to the population should be reduced as far as practicable and has adopted the Commission Review recommendations and supported their early implementation. The Commission is aware that since the Review Report, the applicant has offered to purchase Property 44 if requested by the owner. This offer has been included in its

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Statement of Commitments, which are contained in Appendix 9 of the recommended conditions of consent. Should the owners decide to sell, the applicant would include this property in a revised Biodiversity Offset Strategy. To facilitate this outcome, the Department has proposed conditions requiring the purchase of the property should the owner so request, in accordance with the Land Acquisition conditions in Schedule 4 of the recommended consent. If the owners of Property 44 are not willing to sell their property, Condition 35 provides that Yancoal could negotiate an agreement to conserve and manage the native vegetation on the property so that it is integrated with Offset Areas 2 and 3. The Commission acknowledges the challenges associated with relying on privately owned land to enhance the current offset strategy. It accepts that the Department’s recommended conditions provide the best approach to securing the vegetation of Property 44 to potentially enhance the conservation of the local Squirrel Glider population. USecuring offsets in perpetuity The Department does not agree with the Commission’s Review Report that there is a lack of certainty regarding the mechanisms for conservation of the offset areas. Since the Review Report was finalised, the OEH has released the NSW Biodiversity Offset Policy for Major Projects. This policy requires avoidance of impacts where possible, then minimising, mitigating and remediating. The Policy recognises that developers should be required to provide suitable compensatory offsets for environmental impacts. Once the Offset Policy is fully implemented, the sole mechanism acceptable to OEH for securing land-based offsets in perpetuity will be biobanking agreements. In the meantime, acceptable mechanisms include:

dedication of land under the National Parks and Wildlife Act 1974;

Trust Agreements under the Nature Conservation Trust Act 2001;

Property Vegetation Plans registered on title under the Threatened Species Conservation Act; and

Public Positive Covenants and Restrictions in Use of Land under the Conveyancing Act 1919.

The Commission is satisfied that Condition 37 adequately protects the offset areas in perpetuity and is consistent with the recently adopted NSW Biodiversity Offset Policy for Major Projects UBiodiversity Management Plan The Department’s recommended conditions of consent include the requirement for a Biodiversity Management Plan to be submitted to the Secretary for approval prior to 30 December 2015. The applicant has requested flexibility with the timing provided in this condition due to the uncertainty associated with the commencement date of the project. Neither the Department nor the OEH supports this request, as they are of the view that mitigation measures are best addressed sooner rather than later. The Commission agrees with this position and therefore accepts the current wording of the condition.

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Figure 3: Proposed offset areas

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8.7 Compensatory water supply The EPA has requested that Condition 27 of the Department’s recommended conditions of consent be amended. This condition provides for replacement water supply to all landowners whose water supply may be affected by the project. This particularly includes those landowners with wells and bores (in addition to those who may take water directly from the Avon River and its tributaries). The EPA has requested that the Condition be amended to require the compensatory water supply to be of a quality consistent with typical low flows in the Avon River. The Department has advised that the EPA’s request is not supported, as the water quality of low flows in the Avon River is not an appropriate reference for water quality found in bores and wells. It may also be inappropriate for surface water flows if a loss of water supply was identified at a time other than low flows in the Avon River. The Department believes that the condition as recommended fulfils the requirement to provide a compensatory water supply of equivalent quality and quantity. However, to remove any doubt it is recommended that the words “in quality and volume” be added to the condition, as follows:

27. …The compensatory water supply measures must provide an alternative long-term supply of water that is equivalent, Uin quality and volumeU, to the loss attributed to the development. Equivalent water supply should be provided (at least on an interim basis) within 24 hours of the loss being identified….

The Commission supports the Department’s recommendation. 8.8 Other issues All other aspects of the project are acceptable to the Commission and have been adequately addressed in the Department’s recommended conditions of consent.

9. COMMISSION’S DETERMINATION The Commission has carefully considered the Secretary’s Final Assessment Report as well as submissions made to the Department and the Commission. It has also considered the recommendations included in its Review Report of April 2014. The Commission notes that a number of its recommendations have been subsequently addressed in recently released State policy documents relating to biodiversity offsets, voluntary land acquisition and noise mitigation. The Commission also notes that further policy is currently under development in relation to industrial noise and economic assessments. The Commission supports the project, as it allows for the rational and efficient extraction of a coal resource within an existing mine, and ensures the continuation of its strong association with the nearby Duralie mine. Having regard to the relevant issues, the Commission finds that the proposal will be beneficial to the community, and that the environmental and amenity impacts can be adequately mitigated or managed by stringent conditions. Therefore, the Commission has determined to approve the project, subject to the conditions recommended by the Department, as amended by the Commission. The Commission’s amendments are as follows:

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Schedule 3

1. Condition 6(e) (Noise Management Plan) – delete.

2. Condition 9 (Real Time Noise Monitoring Review) – delete.

3. Condition 27 (Compensatory Water Supply) – amend as follows:

The Applicant shall provide a compensatory water supply to the owner of any privately-owned land whose water supply is adversely and directly impacted (other than a negligible impact) as a result of the development, in consultation with NOW, and to the satisfaction of the Secretary.

The compensatory water supply measures must provide an alternative long-term supply of water that is equivalent, in quality and volume, to the loss attributed to the development. Equivalent water supply should be provided (at least on an interim basis) within 24 hours of the loss being identified.

If the Applicant and the landowner cannot agree on the measures to be implemented, or there is a dispute about the implementation of these measures, then either party may refer the matter to the Secretary for resolution.

If the Applicant is unable to provide an alternative long-term supply of water, then the Applicant shall provide alternative compensation to the satisfaction of the Secretary.

4. Condition 36 (Cabbage Gum Open Forest) – amend as follows:

The Applicant shall ensure the establishment of vegetation in the Biodiversity Offset Area and Biodiversity Enhancement Area includes the establishment of flora species characteristic of the Cabbage Gum Open Forest community as described in the note below Table 9. The NSW Scientific Committee’s Final Determination for ‘Subtropical Coastal Floodplain Forest of the New South Wales North Coast Bioregion’ (NSW Scientific Committee 2011) endangered ecological community should be consulted in determining the species suite for re‐establishment of this community.

Ms Robyn Kruk AM Mr Gordon Kirkby Member of the Commission (Chair) Member of the Commission

Dr Andrew Stoeckel Member of the Commission

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APPENDIX 1 SUMMARY OF MEETINGS

MEETING NOTE

Briefing from Department of Planning and Environment

Meeting note taken by Kate Wedgwood Date: Thursday 23 April 2015 Time: 10.00am

Project: Stratford Extension Project

Meeting place: PAC office

Attendees:

PAC Members: Ms Robyn Kruk AM, Dr Andrew Stoeckel and Mr Gordon Kirkby

PAC Secretariat: Kate Wedgwood

Department: Mr Oliver Holm and Mr Colin Phillips

The purpose of the meeting is for the Department to brief the Commission on the project

A summary of the topics discussed are provided below. UOverview of project

Mining has occurred in this area since 1996.

Three additional pits proposed to recover coal from existing seams.

The mine is not large compared to other mines in NSW, however the coal is of high quality.

Yancoal also operates Duralie mine.

The operation of the two mines is integrated as Duralie transports coal to Stratford.

The seams at Stratford dip steeply, which means the style of mining is different to that used in the Upper Hunter. No drag lines are used and the pits are deep and narrow.

Once mining is complete, there will be three final voids. Three other voids will be in-filled and rehabilitated.

UResponse to Commission’s Review Report

18 of the Commission’s 31 recommendations have been adopted.

UNoise

The Department does not dispute that there may be some noise impacts arising from the proposal.

The recommended noise conditions provide an appropriate response to the Commission’s Review Report.

An updated Industrial Noise Policy is expected to be exhibited in 2015, but timing is unknown.

The Department does not agree with The Commission’s recommendation regarding compensation for “lifestyle properties”, as this is not an approach previously used by the government and therefore lack consistency.

Yancoal has offered to purchase Property No.44 (excluding the house). This property is not covered under the State’s Acquisition Policy.

Noise mitigation will be required at Property No.60, but not until work commences at the south pit (in approximately six years).

No mitigation measures are proposed at Property No.23.

The Department believes that Yancoal can improve its noise monitoring.

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The community has requested real-time monitoring. The Department notes that this is a management tool rather than a compliance method. The receivers need to be attended to validate data.

There is not expected to be a significant increase in rail noise, even under adverse conditions. The average number of trains will not increase (though the maximum number of train movement in a day may increase by a maximum of two trains).

UBiodiversity

The proposed Biodiversity Offset Strategy is acceptable to the Department.

Additional research has been undertaken on the Squirrel Glider population in the area. In response to this, a Squirrel Glider Management Plan has been recommended which will manage the impacts on mining on the Glider’s habitat.

Acquisition of Property No. 44 would enhance the Biodiversity Offset Strategy. UAir quality

Dust generated on the site is from crushed rock and overburden, rather than mining itself. URoads

Gloucester Shire Council does not agree with the Department’s recommended approach to road contributions.

The Department has encouraged negotiation between the applicant and Council.

The Commission’s Review Report only considered Gloucester Shire LGA and not Great Lakes LGA.

The Department’s view is that Yancoal is not entirely responsible for reconstruction of The Bucketts Way, as other trucks use this road and the majority of coal is transport via rail.

Ongoing traffic counts are recommended for monitoring.

UCost Benefit Analysis

The Department is satisfied with the royalty estimates, which will fluctuate in response to the value of coal.

Documents to be provided: Larger map of mine and the surrounding area.

Meeting closed at 11.15am

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MEETING NOTE

Meeting with the applicant (Yancoal Australia Ltd)

Meeting note taken by Kate Wedgwood Date: Friday 1 May 2015 Time: 10.00am


Meeting place: Stratford mine

Attendees:



Yancoal: Mark Jacobs (General Manager – Environment and Community), Doug Gordon (Site Operations Manager), Scott Mitchell (Site Environmental and Community Manager) and Peter Cribb (Resource Strategies).

The purpose of the meeting is to undertake a site inspection of the mine and surrounding area.

Documents to be provided: Nil

Site inspection concluded at 12.00pm

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MEETING NOTE

Meeting with Gloucester Shire Council

Meeting note taken by Kate Wedgwood Date: Friday 1 May 2015 Time: 1.30pm


Meeting place: Gloucester Shire Council

Attendees:



Council: Mr Danny Green (General Manager)

The purpose of the meeting is for the Council to brief the Commission on any concerns it has with the Department’s assessment report and recommended conditions of consent.

A summary of the topics discussed are provided below. UOverview

Overall, the Council sees the mine’s expansion as a positive, however there is a need to mitigate impacts, in particular noise.

There is a potential for cumulative impacts when the proposal is considered against other mines in the area.

Previous concerns raised by Council remain.

URoads Council is not satisfied with the Department’s recommended approach to road contributions. There are currently no overtaking lanes from Newcastle on The Bucketts Way. There will be additional vehicle movements on the existing struggling road. The contribution should be based on tonnage.

UFinal voids

There is concern regarding the final voids and what they will become in the future.

UWater quality Concern regarding water quality in Stratford.

UBiodiversity

Council does not have any significant concerns in relation to biodiversity. UOther issues

Council is interested in developing a large-scale industrial site adjacent to the entry to the mine. It has approach the applicant, who is not willing to sell the land.

Documents to be provided: Nil

Meeting closed at 2.00pm

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MEETING NOTE

Meeting with Office of Environment and Heritage (OEH)

Meeting note taken by Kate Wedgwood Date: Tuesday 12 May 2015 Time: 9.45am


Meeting place: Teleconference

Attendees:



OEH: Richard Bath (Senior Team Leader) and Steve Lewer (Officer)

The purpose of the meeting is for the OEH to brief the Commission on any concerns it has with the Department’s assessment report and recommended conditions of consent.

A summary of the topics discussed are provided below.

The OEH is generally supportive of the Department’s recommended conditions of consent, including the timing of the Biodiversity Management Plan

The proposed biodiversity offset strategy, including the quantum of the offset, is consistent with OEH expectations.

All offsets sites should be secured and managed under an appropriate conservation mechanism, such as a BioBanking Agreement. OEH does not support the use of covenants under the Conveyancing Act 1919.

The OEH did not raise concerns regarding the impact on Squirrel Gliders in any previous submission.

OEH did not have any specific concerns about the fauna survey during its initial review of the Review of Environmental Factors.

The OEH was under the impression that one of the properties surrounding the mine site (property 44) was part of the offset package. It is now aware that this is incorrect, which is unfortunate as this property would have added to habitat conservation.

The OEH provided suggested wording to Condition 36, which relates to the establishment of Cabbage Gum Open Forest within the biodiversity offset area and biodiversity enhancement area.

Documents to be provided: Preferred wording of Condition 36.


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MEETING NOTE

Meeting with Roads and Maritime Services (RMS)

Meeting note taken by Kate Wedgwood Date: Tuesday 12 May 2015 Time: 12.00pm


Meeting place: Teleconference

Attendees:



RMS: Tim Browne (Manager – Land Use Assessment) and Michael Papadopoulos (Regional Local Government Programs Coordinator)

The purpose of the meeting is for the RMS to brief the Commission on any concerns it has with the Department’s assessment report and recommended conditions of consent.


None of the recommendations provided by the RMS to the Department have been included in the recommended conditions of consent.

Specifically, RMS request is that The Bucketts Way / Wenham Cox Road intersection be upgraded to minimum standards, with a basic right hand turn lane.

The RMS has no funding dedicated to upgrade of The Bucketts Way, which is a Regional Road under the control of local government.

Councils can apply for special funding for road upgrades through the Roads Minister, however funding is limited.

Future road maintenance contributions from other industries using The Bucketts Way would be project-specific, and there would have to be a direct nexus between the development and the impact on road traffic.

The RMS considers the Department’s recommended approach to road contributions is fair. The RMS has no immediate safety concern regarding the intersection of The Bucketts Way

with the mine’s access road.

Documents to be provided: A copy of the RMS letter to the Department, requesting intersection upgrades.

Meeting closed at 12.15pm

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MEETING NOTE

Briefing from Department of Planning and Environment

Meeting note taken by Kate Wedgwood Date: Tuesday 12 May 2015 Time: 10.30am


Meeting place: PAC office

Attendees:



Department: Mr Colin Phillips

The purpose of the meeting is for the Commission to seek further clarification from the Department on a range of issues.


UThe Bucketts Way There is an expectation that mines will contribute to road maintenance. There is disagreement between the applicant and Council regarding traffic counts. To ensure

data is kept up-to-date, the Department has recommended ongoing traffic monitoring. There is no government policy on road contributions. The contribution made by Duralie Mine to Great Lakes Council is the result of negotiation

between parties. The Review Report’s recommendation in relation to contributions creates a disproportionate

contribution, as it does not consider Great Lakes Council. The priority of the upgrade of The Bucketts Way is not known by the Department. The Department has requested an upgrade of the intersection of The Bucketts Way and the

mine access road in its conditions of consent. UBiodiversity Management Plan

The timing of the Biodiversity Management Plan should remain as recommended in the draft conditions of consent. This will enable advanced habitat establishment.

U24 hour operations The mine has historically operated 24 hours a day. 24 hour operation will allow for the economical functioning of the mine.

UAir quality

The amount of dust from the mine is predicted to be very low.

Documents to be provided: Written response to the issues raised.


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APPENDIX 2 ADVICE FROM THE DEPARTMENT OF PLANNING AND ENVIRONMENT

1

Kate Wedgwood

From: Kate WedgwoodSent: Thursday, 28 May 2015 4:51 PMTo: pacSubject: FW: Stratford - intersection upgrades

From: Colin Phillips Sent: Tuesday, 26 May 2015 2:27 PM To: Kate Wedgwood Cc: Howard Reed Subject: RE: Stratford - intersection upgrades Kate, Wenham Cox Road 1. The project does not propose to increase traffic using this intersection. If there had been a substantial increase in traffic usage, then it would have been appropriate to seek a proportional contribution to the intersection upgrade. If the intersection were to be upgraded it would be to a condition (configuration) that would be better than it was originally built. The Stratford Extension Project would not be a cause for the upgrade of the intersection – there would be no increase in existing traffic generated by Yancoal. The accident history of the intersection does not indicate that there is a safety issue that needs to be corrected to enable Yancoal’s continued use of this intersection. The monies for the maintenance of Wenham Cox Road are just that ‐ funds to maintain the existing condition of the road in accordance with the impacts of Yancoal’s continued rate of use . The Department has proposed a mechanism that would ensure Yancoal’s contribution to maintenance would be in proportion to its use of the road. This would involve the undertaking of yearly inspections of road condition and collection of traffic counts to ensure this proportionality would be correct ascribed. However, this “fairness” comes at a cost. Yancoal has proposed as an alternate mechanism (considered acceptable by the Department) to contribute $5,000 a year for Wenham Cox Road maintenance to avoid the trouble of arranging and implementing the proposed measures to establish its proportionality. The offer of $5,000 per year, is in the Department’s estimation, generous when compared to the likely amount that would accrue by determining impacts to road condition. The intersection with The Bucketts Way is in fact part of Wenham Cox Road and if the surface of this intersection needs to be maintained from time to time, then the funds for Wenham Cox Road could be appropriately applied to this section of the road. Compensatory Water Supply 2. The changes proposed by the EPA to condition 27 are more narrowly focussed than the breath of the condition. Condition 27 provides for replacement water supply to all landowners whose water supply may be affected by the project. This particularly includes those landowners with wells and bores (in addition to those who may take water directly from the Avon River and its tributaries). The proposed tying in of the water quality to be consistent with low flows in the Avon River is an inappropriate reference for the water quality to be found in bores and wells. It may also be inappropriate for surface water flows if a loss of water supply was identified at a time other than low flows in the Avon River.

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The Department believes that the condition as written fulfils the requirement to provide a compensatory water supply of equivalent quality and quantity, but to remove any doubt we propose the words “in quality and volume” be added as shown in red text in the revised condition. 1. The Applicant shall provide a compensatory water supply to the owner of any privately‐owned land whose

water supply is adversely and directly impacted (other than a negligible impact) as a result of thedevelopment, in consultation with NOW, and to the satisfaction of the Secretary. The compensatory water supply measures must provide an alternative long‐term supply of water that is equivalent, in quality and volume, to the loss attributed to the development. Equivalent water supply should be provided (at least on an interim basis) within 24 hours of the loss being identified.

If the Applicant and the landowner cannot agree on the measures to be implemented, or there is a dispute about the implementation of these measures, then either party may refer the matter to the Secretary for resolution.

If the Applicant is unable to provide an alternative long‐term supply of water, then the Applicant shall provide alternative compensation to the satisfaction of the Secretary.

Please contact me if any questions remain. Colin Phillips Team Leader Mining Projects Department of Planning and Environment P: 92286483 [email protected]