Australia scales back controversial China-run coal mine site

SYDNEY: Australia has bought back most of a contentious mining licence issued for a huge Chinese-run coal mine near prime agricultural land, officials said on Wednesday, but farmers are still not happy.

Chinese company Shenhua was granted the original exploration licence for the Aus$1.0 billion ($770 million) Watermark mine near Gunnedah in New South Wales state in 2008 by a previous Labor government.

But the decision was challenged by local farmers and environmental activists, who blasted it as harmful to a region known for its rich soil, water resources and ideal climate.

Large-scale mining in rural areas as well as foreign ownership of key agricultural and mineral assets are sensitive topics in Australia, with Canberra knocking back several sales in recent years citing national interest.

Under the new arrangement, the NSW Liberal government has taken back 51.4 per cent of the exploration licence for Aus$262 million.

“This government has determined there should be no mining on the fertile black soils of the Liverpool Plains,” NSW Resources Minister Don Harwin said.

“Any future mining activity will now be restricted to the ridge lands, with a commencement still subject to further management plans and the ongoing monitoring of strict conditions already in place.”

The state government said the Shenhua Watermark Coal Project, with a mine life of 30 years, would still have to comply with strict environmental conditions.

Shenhua Australia’s Chairman Liu Xiang said that his firm would ensure the project “meets the highest environmental standards”. — AFP