John Barilaro wants NSW coalmine expansion to proceed despite water safety fears for Sydney

NSW’s deputy premier says his department will explore all legal options to “find a way forward” for a major Illawarra coalmine expansion after the Independent Planning Commission rejected the proposal.

Mining corporation South32 sought to expand the Dendrobium coalmine at Kembla Heights to extract an additional 78m tonnes of coal from two new areas, and to extend the mine’s life until 2048.

The NSW planning department in October recommended approving the expansion, saying it would provide “major economic and social benefits”, including protecting about 400 local jobs.

But the Independent Planning Commission (IPC) this month found the project’s risks to greater Sydney’s drinking water catchment were too high, and knocked back the proposal.

The IPC also pointed to other potentially permanent adverse impacts on the environment.

“The level of risk posed by the project has not been properly quantified and based on the potential for long-term and irreversible impacts – particularly on the integrity of a vital drinking water source for the Macarthur and Illawarra regions, the Wollondilly shire, and metropolitan Sydney,” the IPC said.

The NSW deputy premier, John Barilaro, on Monday participated in a roundtable discussion on the mine’s future with South32, nearby steelworks operator BlueScope, unions and local business chambers.

Local members Ryan Park, and Paul Scully, who is NSW Labor’s natural resources spokesman, were also present.

Barilaro said the implications of the IPC’s decision on the Illawarra region and the supply of material to the Port Kembla steelworks were potentially significant.

He told reporters he would work to “find a way forward” for the mine expansion, including by seeking legal advice on overturning the IPC’s verdict.

“At no point does anybody, any stakeholders, anybody in government, want to see a detrimental outcome to Sydney’s water catchment,” Barilaro said.

“But at the same time we’ve got to balance the advantages and opportunities for the economy, and we know we can. We know they can coexist.

There’s a failure there wasn’t an opportunity to work through those issues.”

Greens and environmental groups have supported the IPC’s decision, saying it should be “the nail in the coffin” for mining near water catchments.

Photograph: Brook Mitchell/Getty Images NSW deputy premier, John Barilaro, says a decision to reject the expansion of the Dendrobium coalmine, west of Wollongong, could affect the supply of coal to the Port Kembla steelworks.