Embattled Resources and Energy Minister Don Harwin stonewalled questions in NSW Parliament on Thursday about how Ridgelands Coal Resources made an unsolicited $500,000 offer to Muswellbrook Shire Council for a community fund in July, 2017, when an exploration licence condition of consent in 2013 required $5 million.

He was questioned by the Opposition a day after facing suspension from the NSW Upper House over the government’s refusal to hand over documents about controversial Sydney stadium and museum projects.

Documents obtained by the Newcastle Herald under freedom of information laws have raised even more questions about the department’s involvement in the secret condition, with emails in August, 2017 showing former department deputy secretary Kylie Hargreaves slapping down a more junior employee’s assessment that the department had “inadvertently approved” the Ridgelands community fund variation.

The “inadvertent” approval may have occurred when a work program over more than 7000 hectares of Wybong land within the Ridgelands exploration licence area was varied “without knowledge of the special condition” for the community fund, the junior employee wrote.

The approval may have occurred in “that grey area where work programs now cover community matters as well”, the employee said.   

“I totally disagree with (that) reading of the situation,” Ms Hargreaves wrote in an email in response, only days after Muswellbrook Council initiated legal action in the NSW Supreme Court to enforce the full $5 million from Ridgelands, and the Herald made public the secret condition.

Ms Hargreaves resigned in February. Mr Harwin refused to answer questions in Parliament early this year about whether the resignation was linked to the Ridgelands controversy.

On Thursday he responded to Opposition questions about his department’s role by repeatedly saying the $5 million was paid by Ridgelands, and 36 community projects in the Muswellbrook area had been approved for funding by May 28.

The Resources Regulator is still investigating why Ridgelands failed to establish the fund for more than four years, despite a five-year exploration licence over the Wybong land requiring the fund’s establishment “as soon as reasonably practical” after the licence was granted by the NSW Government in February, 2013.

The government and department have also failed to respond to Herald questions about why the condition remained an unfulfilled secret for more than four years, despite the licence requiring regular reporting on the community fund to senior government and department officials.

The Department of Planning released a series of documents in response to a Herald freedom of information request, but refused to release a document prepared for Cabinet. Third parties have also objected to the release of a series of emails between the department’s resources and geoscience division and the Resources Regulator in August and September, 2017, and annual reports from Ridgelands to the department.

Documents released show a variation to the Ridgelands work program in April, 2017 and a presentation by a consultant for Ridgelands to the department at that time. Emails in August after the fund shortfall was made public show department representatives seeking the Ridgelands presentation because available information “does not mention anything about varying the amount required under the fund”.

Opposition Upper House leader and resources and energy spokesperson Adam Searle said it was “completely unbelievable that the agency responsible for supervising mining in this state was ‘unaware’ of Ridgelands’ $5 million community fund obligation or that cutting it to just $500,000 was ‘inadvertent’.”

“Given Mr Harwin’s then departmental deputy secretary said she ‘totally disagree[d]’ with this excuse, he must give an immediate and full explanation of what went on inside his agency,” Mr Searle said.

Muswellbrook mayor Martin Rush said it was still not clear how Ridgelands “came to believe that spending $500,000 instead of $5 million was ever acceptable, except that Ridgelands had argued to us that the State Government had told them so”.

“One of the issues in all of this is the lack of transparency about the whole process. It seems to me the Independent Commission Against Corruption’s recommendations about improving the transparency of the process are important for the government to consider,” Mr Rush said.

“If the process was more transparent, inadvertent errors are more likely to be detected earlier in the process.”

In March former ICAC chair David Ipp, QC, criticised the government for continuing to process Ridgelands’ application to renew the exploration licence, which expired in February, while the Resources Regulator investigated the alleged failure to comply with its original licence condition to establish the $5 million community fund.