Caroona Coal Project

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The Caroona Coal Project is a proposed underground coal mine in the Gunnedah Basin, in north-western New South Wales. The project is being investigated by BHP Billiton. In a September 2010 presentation BHP Billiton listed the Caroona Project as one of its major coal projects in the development pipeline.

Background

In August 2005 the NSW Department of Primary Industries announced that it was seeking Expressions of Interest for the awarding of an exploration licence over the Caroona Coal Area which it stated "500 million tonnes of in situ, potentially mineable, underground coal". The original resource estimate was by the Department of Primary Industries – Mineral Resources as a result of government-funded coal exploration. The department stated that "large resources of coal suitable for underground mining have been identified and there may be potential for some limited open cut mining."

On February 17 2006 the government announced that BHP Billiton had been the winning tenderer. In April 2006 the formal completion of the awarding of the five-year long exploration licence was announced. The media release claimed that the project "has the potential to generate 1,000 new jobs and up to $2 billion in capital works and infrastructure projects over the next two decades. Exploration work would be carried out in stages, with up to 300 boreholes to be drilled by 2010."

With opposition to the project having emerged before the exploration licence had even been awarded BHP Billiton used the occasion to announce the creation of the Caroona Regional Community Trust which would distribute "up to A$5 million to community programs and projects over the next five years." BHP Billiton Executive President, Mr Bob Kirkby, stated that the trust creation was "in recognition of the impact a large development can have on local communities and to plan towards upgrading local amenities. The Trust will also provide education services and scholarships and provide assistance to environmental and indigenous programs. We recognise that we have a commitment to the local community and we look forward to working closely with them in the future.

Later that year, in presentation to the Gunnedah Coal Conference, BHP-Billiton indicated that it was aiming to complete the feasibility study and environmental assessment by mid 2011 and have corporate approval for the project by by mid-2011. The company indicated that it was aiming for contracts to be awarded by the end of 2011, construction from early 2012 and the mine commissioned in 2014.

Power station?

While the company has discussed the project as only comprising a proposed coal mine, concerns have been raised that the company is also required to investigate the possibility of an associated power station as well. In a budget estimates committee, a NSW government representative was asked whether the exploration licence agreement signed between the NSW Government and BHP Billiton "for the Caroona coal field include a requirement for BHP to study the potential for a coal-fired power station in the Gunnedah region? Why was this included in the agreement?". In response the representative did not directly address the question, stating only that "I have no formal role in the issuing of exploration rights for coal mining in NSW."

In November 2006, George Souris, a member of the National Party in the New South Wales parliament, expressed concern about the proposed Caroona mine. "I also want the House to note my displeasure and that of the community about something that was revealed in a budget estimates committee hearing. The Minister was asked whether there was any prospect of an electricity generation plant, a power station, being built in the area. The Minister revealed that BHP Billiton had asked the Government for indicative approval to include a thermal power station, which would use some of the resource mined in that area, in utilisation studies in preparation for environmental assessment. The Minister said that it was an initiative of BHP, but that BHP had the approval of the Government to embark on these utilisation studies. I put on the parliamentary record that I oppose any form of mining on the Breeza Plains. Further, I oppose any form of electricity power station in the vicinity, partly because of my general opposition to a power plant in the area but specifically because coalmining activity would take place so that the resource could feed the power station. My displeasure arises primarily because the power plant proposal was never made public."

Citizens groups opposing the Caroona Mine

• Caroona Coal Action Group: :http://www.ccag.org.au/

Official BHP Billiton website

• http://www.bhpbilliton.com/home/aboutus/regulatory/Pages/default.aspx#010_EnergyCoal

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