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NSW taxpayers will pay $5 million compensation to mining giant Yancoal if it is "inconvenienced", under an election-eve agreement the NSW government said would save The Drip gorge, but which critics have slammed as "outrageous".
Yancoal and related companies have paid the NSW government just $6 for a deed, signed on March 5, that opens the door for future mining that could threaten the iconic gorge area between Denman and Mudgee.
The deed allows Yancoal's Moolarben Coal to tunnel beneath the Goulburn River if, "in Moolarben's opinion ... any alternative is inefficient, uneconomic or cost-prohibitive".
The Goulburn River is the Hunter River's main western tributary.
The deed also requires the NSW government to pay Yancoal and related companies $5 million compensation if they are "inconvenienced" by the revocation or variation of an easement through a State Conservation Area.
While Moolarben is required to take "all reasonable actions to ensure the conservation of The Drip", the standard of protection is qualified by clause 4 of the deed stating "unless a future development consent provides otherwise".
Landowners Julia and Colin Imrie, who offered 10 hectares of Goulburn River land to the NSW government to reverse a Labor government land "gift" of The Drip to Moolarben in 2010, described the Baird government's deed as "outrageous", and "more about acknowledging the mine's right to tunnel beneath the river than protecting The Drip".
"We are stunned as it is even worse than we feared," said Mrs Imrie after a copy of the deed was made available to them.
On March 14 then Environment Minister Rob Stokes, now Minister for Planning, said the deed meant The Drip would be protected from future mining proposals.
"Today we are undoing the sale of The Drip that occurred when Labor was last in power, disgracefully selling this natural wonder for $2000 in a 2010 lease conversion sale that cost the coal company less than $3 a hectare," Mr Stokes said.
While the deed placed 23 hectares of the Moolarben land, including The Drip, into Goulburn River National Park, a complex series of options - including Moolarben and the government negotiating the possible purchase of Crown land from Aboriginal groups - "failed to safeguard The Drip and river corridor as a no-go area to the mining industry", Mr and Mrs Imrie said.
Yancoal spokesman James Rickards said the company received no compensation for surrendering The Drip land under the agreement.
The company gave enforceable commitments to ensure The Drip and its water supply were protected from "any activities that [Yancoal] may choose to carry out".
"There has never been any plan to conduct mining at The Drip or beneath it," Mr Rickards said.
The peppercorn payment of $6 "is the result of legal requirements around deeds".
