Failed coal seam gas mining company Linc Energy's 9 week trial underway in Queensland, Australia

As the story unfolded.........

ABC News, 16 April 2016:

Oil and gas company Linc Energy has been placed into administration in a bid to avoid penalties for polluting the environment, a Queensland green group says.

It was announced late Friday that administrators PPB Advisory had been called in to work with Linc's management on options including a possible restructure.

In a statement to the ASX, the company said after receiving legal and financial advice and considering commercial prospects the board decided it was in the best interests of the company to make the move.

It comes one month after the company was committed to stand trial on five charges relating to breaches in Queensland's environmental laws at its underground coal gasification site.

The state's environment department accused the company of wilfully causing serious harm at its trial site near Chinchilla on the Darling Downs.

Drew Hutton from the Lock the Gate Alliance said the company could face up to $56 million in fines if found guilty, but the penalty might never be paid.

"It is going to be difficult to get any money out of this company now that it is in administration," he said.

Mr Hutton said going into administration was a common legal manoeuvre to dodge fines and costly clean-ups......

Queensland Government, Dept. of Environment and Heritage Protection, 29 January 2018:

Environmental Protection Order directed to Linc

Prior to Linc entering liquidation, DES issued Linc with an Environmental Protection Order (EPO) which required it to retain critical infrastructure on-site, conduct a site audit and undertake basic environmental monitoring to characterise the current status of the site.

Linc’s liquidators launched a legal challenge associated with this EPO in the Supreme Court seeking orders that they were justified in not causing Linc to comply with the EPO (or any future EPO). DES opposed this application.

In April 2017, the Supreme Court directed that Linc’s liquidators are not justified in causing Linc not to comply with the EPO. The Court accepted DES’ argument that the relevant provisions of the EP Act prevail over the Commonwealth Corporations Act and that Linc’s liquidators are executive officers of the company. Subject to any appeal decision, this confirms DES’s ability to enforce compliance with environmental obligations owed by resource companies who have gone into administration or liquidation.

Linc’s liquidators have since appealed the decision to the Court of Appeal. This appeal was heard in September 2017 and the decision was reserved.

Environmental Protection Order directed to a related person of Linc

DES used the ‘chain of responsibility’ amendments to the EP Act to issue an EPO to a ‘related person’ of Linc. The EPO requires the recipient to take steps to decommission most of the site’s dams and provide a bank guarantee of $5.5 million to secure compliance with the order.

The recipient of the EPO has appealed to the Planning and Environment Court and that litigation is ongoing.

The recipient of the EPO also applied for an order that the appeal be allowed and the EPO be set aside on the basis that DES denied him procedural fairness. The Planning and Environment Court dismissed that application. The recipient of the EPO appealed that decision to the Court of Appeal. That appeal was heard in March 2017 and judgment in favour of DES was delivered in August 2017. Subject to any further appeal, this decision confirms that the recipient was not denied procedural fairness and that DES’ interpretation of the EP Act was correct.

The earlier appeal in relation to the EPO (regarding the substance of the document) is yet to be heard by the Planning and Environment Court.

Investigation and prosecution of Linc and former executives

Linc Energy Limited will stand trial in the Brisbane District Court, commencing 29 January 2018, on five counts of wilfully causing serious environmental harm, in contravention of the Environmental Protection Act 1994.

All counts relate to operations at the Linc Energy underground coal gasification site near Chinchilla, from approximately 2007 to 2013, and allege that contaminants were allowed to escape as a result of the operation.

In addition, the Queensland Government has charged five former Linc Energy executives over the operation of the UCG site in Chinchilla. A committal hearing in the Brisbane Magistrates Court is expected to take place in mid-2018.

As these matters remain before the courts, DES is unable to comment further on the legal proceedings.

Media releases

11 March 2016—Linc Energy committed for trial

ABC News, 30 January 2018:

A landmark case described by a District Court judge as "unusual" will hear how gas company Linc Energy allegedly contaminated strategic cropping land causing serious environmental damage to parts of Queensland's Western Downs.

Linc Energy is charged with five counts of wilfully and unlawfully causing environmental harm between 2007 and 2013 at Chinchilla.

The charges relate to alleged contamination at Linc Energy's Hopeland underground coal gasification (UCG) plant.

The trial will enter its second day today in the District Court in Brisbane, with crown prosecutor Ralph Devlin QC expected to begin his opening address to the empanelled jury later this morning.

Former Linc Energy scientists, geologists, and engineers as well as several investigators from the Queensland Environment Department are among those expected to give evidence.

Echo NetDaily, 30 January 2018:

BRISBANE, AAP – A failed energy company accused of knowingly and illegally polluting a significant part of Queensland’s Darling Downs has faced trial in a landmark criminal case in Brisbane.

Linc Energy is charged with five counts of wilfully and unlawfully causing environmental harm between 2007 and 2013 after allegedly allowing toxic gas to leak from its operations.

The Brisbane District Court trial has heard Linc’s four underground coal gasification (UCG) sites and water were polluted to the point it was unfit for stock to consume but the company kept operating.

Crown prosecutor Ralph Devlin QC told the jury the company allowed hazardous contaminants to spread even after scientists and workers warned about gases bubbling from the ground.

Linc operated four UCG sites in Chinchilla where it burnt coal underground at very high temperatures to create gas.

In his opening address on Tuesday, Mr Devlin said scientists warned senior managers about the risk environmental harm was being caused throughout the operation…..

 ‘Bond prioritised Linc’s commercial interests over the requirements of operating its mining activity in an environmentally safe manner,’ Mr Devlin said.

‘Linc did nothing to stop, mitigate or rehabilitate the state of affairs that Linc itself had caused.’

As part of the UCG process, Linc injected air into the ground, which created and enlarged fractures.

It tried to concrete surface cracks and use wells to control pressure but they didn’t sufficiently reduce risks or damage, the court heard.

‘Linc kept going, even knowing the measures weren’t working,’ Mr Devlin said.

Scientists who visited the site are due to give evidence during the nine-week trial, but no senior managers from the company, which is in liquidation, will take the stand.

The trial continues.

ABC News, 8 February 2018:

Workers at an underground coal gasification plant on Queensland's Western Darling Downs were told to drink milk and eat yoghurt to protect their stomachs from acid, a court has heard.

The gas company has pleaded not guilty to five counts of causing serious environmental harmfrom its underground coal gasification operations between 2007 and 2013 in Chinchilla.

The corporation is not defending itself as it is in liquidation so there is no-one in the dock or at the bar table representing the defence.

A witness statement by former gas operator Timothy Ford was read to the court, which he prepared in 2015 before his death.

The court was not told how Mr Ford died.

He said the gas burnt his eyes and nose and he would need to leave the plant after work to get fresh air because it made him feel sick.

"We were told to drink milk in the mornings and at the start of shift… we were also told to eat yoghurt," he said.

"The purpose of this was to line our guts so the acid wouldn't burn our guts.

"We were not allowed to drink the tank water and were given bottled water."

Mr Ford said he always felt lethargic, suffered infections and had shortness of breath.

"During my time at the Linc site, would be the sickest I have been," he said.

"It is my belief that workplace was causing my sickness.

"I strongly feel that the Linc site was not being run properly due to failures of the wells and gas releases.".....

Sunshine Coast Daily, 9 February 2018:

A CONCRETE pumper says he saw 'black tar' seeping up at a Linc Energy site and raised concerns with the company.

Robert Arnold has told a court he noticed some odd occurrences when he went to the Chinchilla site in late 2007……

On Thursday, Mr Arnold told jurors he noticed several phenomena at the site.

"We saw bubbles coming up ... and a black tar substance. We commented back to Linc about it."

"A few of us went over and had a look ... basically it just looked like a heavy black oil ... it was in the puddles as well, in the same area," Mr Arnold added.

"We couldn't place our equipment close to the well because of these overhead pipes ... it was dripping out of the joints."

Prosecutor Ralph Devlin earlier claimed a "bubbling" event happened on the ground after rainfall at the coal gasification site.

Mr Arnold told jurors that after discussing the oozing substance, concrete trucks turned up and he pumped the concrete into a well.

Mr Arnold said he felt the concrete used that time was "very light" but the on-site supervisor made that decision.

Prosecutors previously told the court concerns were raised at various times with Linc leadership about the quality of cement and geological data used at the site.

The Crown has also claimed Linc used its underground wells in a way that made them fail, and allowed contaminants to escape far way, to places Linc could not remove them.

BACKGROUND

Wikipedia, 5 February 2018:

Linc started its Chinchilla Demonstration Facility in July 1999. First gas was produced in that very same year. Initially Linc Energy used the underground coal gasification technology worked out by Ergo Exergy Technologies, Inc, of Canada. 

However, in 2006 the cooperation with Ergo Exergy was terminated and the cooperation agreement for technology usage, consultation and engineering services was signed with the Skochinsky Institute of Mining and the Scientific-Technical Mining Association of Russia.[2]

In 2005, Linc signed a memorandum with Syntroleum granting a licence to use the Syntroleum's proprietary gas-to-liquid technology and started to build a GTL pilot plant in November 2007 at the Chinchilla facility. The plant was commissioned in August 2008. The first synthetic crude was produced in October 2008.[3]

January 2018: are environmental vandals in the Liberal & National parties trying to force gasfield expansions down the throats of reluctant communities?

To be eligible your project must bring new gas flow to domestic gas consumers in target markets by 30 June 2020 and can include:

*deployment of new technologies or techniques to lift existing and new well productivity

*the opening of new gas pilot and/or production or exploration wells that are either in proximity to existing gas infrastructure or can demonstrate a path to market

*better utilisation of existing or the establishment of new gas processing, storage and transport facilities

*design, construction and engineering activities directly related to bringing forward new gas supply.

[Gas Acceleration Program, Eligibility Criteria]

Liberal Senator for Queensland and Minister for Resources and Northern Australia Matt Canavan, media release, 20 December 2017:

Gas Acceleration Program Grant Guidelines Released

The Australian Government’s $26 million Gas Acceleration Program (GAP) will open to applications early in the new year, to further strengthen the East Coast gas market.

Guidelines for the GAP were released today, ahead of grant applications opening in January 2018.

The GAP is a significant component of the Australian Government’s $90 million investment in gas security, reliability and affordability for the Australian people.

Minister for Resources and Northern Australia Matt Canavan said the program aimed to deliver new gas supply to domestic users in markets affected by tight supply by fast-tracking new project developments.

“The GAP will offer up to $6 million to gas projects that have substantiated prospects of bringing significant new gas volumes to market by mid-2020,” Minister Canavan said.

“This funding can be used to develop new technologies or techniques to boost well productivity, for new production or exploration near existing infrastructure.  It can also be used to build new gas processing, storage and transport facilities, or for other activities that will bring forward new gas supply.

“This program is implementing our long-term goal to increase the domestic gas supply, boost competition, and improve transparency and efficiency of the gas market supply chain.

“Australian consumers need to be assured that we can access our plentiful gas resources in a responsible way. Bringing more gas to market will reduce upward pressure on gas prices and help to create Australian jobs and support investment in regional Australia.”

Applications to the GAP will be open between 15 January and 13 February 2018.

For more information, visit www.business.gov.au/gap

Media contact: Minister Canavan's office 02 6277 7180

Minister for Resources and Northern Australia Matt Canavan quoted in The Land, 21 December 2017:

“This funding can be used to develop new technologies or techniques to boost well productivity, for new production or exploration near existing infrastructure. It can also be used to build new gas processing, storage and transport facilities, or for other activities that will bring forward new gas supply.”

Adani circles the wagons in Queensland

@AnnastaciaMP exercising the Queensland Government's right of veto

Townsville Bulletin, 18 December 2017:

ADANI has announced it will part ways with its main contractor for its Carmichael megamine.

The Indian mining giant released a statement this morning heralding the change, which comes after Downer pulled information on Adani recruitment events from its website.

Downer was set to develop and operate the mine, but Adani will instead run the mine as an owner-operator.

“Following on from the NAIF veto last week, and in line with its vision to achieve the lowest quartile cost of production by ensuring flexibility and efficiencies in the supply chain, Adani has decided to develop and operate the mine on an owner operator basis,” it read.

“Adani and Downer have mutually agreed to cancel all Letter of Awards and Downer will provide transitional assistance until 31st March 2018.

“Adani remains committed to develop the Carmichael project and will ensure the highest level of standards and governance.

Map of section Galilee Basin, Qld

Via @ABCTropical

Tony Windsor on fighting the Santos pipeline

“They were there in an attempt to survey a pipeline to convey coal seam gas from gas giant Santos’s proposed Narrabri gas field. As one landholder, David Chadwick, said: the pipeline was the “head of the snake” and if allowed to proceed would provide the infrastructure to convey the gas to Sydney or internationally and provide the political pressure to develop about 850 gas wells near Narrabri, with a view to hundreds more across the Liverpool Plains and associated areas.” [Tony Windsor, former  independent member for the federal seat of New England]

The Saturday Paper, 9-15 December 2017:

Last week I was working with my son Andrew on our farm 25 kilometres north of Coonamble when he received a message that there were trespassers on the neighbouring farm. A digital alert system had been put in place for such an event.

Within minutes, farm vehicles from all the neighbours converged on the scene. Others moved in on the trespassers from the eastern side and in a pincer movement the trespassers became trapped and unable to gain access to their vehicles.

By this time, about 100 agitated and concerned farmers, their employees and families were there to express their disgust at what had just occurred. The police had also arrived.

It was ascertained that these trespassers were not your everyday illegal pig hunters or bushwalkers. But they were no less illegal and in breach of the law.

These trespassers were eventually allowed to leave after the police took their details. They proceeded to another small town called Warren, more than 100 kilometres away, where they were observed acting strangely.

The next day, they were followed on the ground by vehicle and in the air by aircraft and again they invaded private lands without appropriate authority and were hunted off. They returned to Coonamble to complain to police about being harassed, and then they left the district.

The trespassers were dressed in new clothes, trying to look like ecological scientists but without any identification. They had a security officer with them.

The question is why? Why would these people climb over a gate to gain access to the property when on that gate was a sign warning about biosecurity, with the farmer’s mobile phone number on the sign? Why wasn’t contact made? Why were they behaving like this?

It has often been said there will be wars over water. In its own way, the scene I was watching was a skirmish in what has the potential to become a war and rewrite the politics of water, land use and energy in this country. It was also an insight into how threatened the farm community felt and demonstrated how it would be difficult to fight these farmers’ guerilla tactics. It was a warning they were serious players.

It also occurred to me that most people in our major cities would not necessarily understand why a small community would mobilise itself so quickly at an apparent breach of their rights.

This article is an attempt to explain some of the detail and policy clashes that will evolve over the coming year, on the Liverpool Plains, on the plain country west of the Pilliga, and around the Adani coalmine in Queensland.

Read the full article here.

Adani Group still cannot find financial backers for Galilee Basin mega coal mine

Indian multinational, the family-owned Adani Group, appears to have financed its Queensland mining venture with debt.

The book value of Adani Enterprises' Carmichael mine project was just under US$2.3bn by mid-2017. While latest report shows its debt has risen by almost US$400m to US$3.83bn.

This debt is further complicated by fraud allegations and investigations by the Indian Government.

The Guardian, 7 December 2017:

Adani’s operations in Australia appear to be hanging on by a thread, as activists prove effective at undermining the company’s chances of getting the finance it needs.

China seems to have ruled out funding for the mine, which means it’s not just Adani’s proposed Carmichael coalmine that is under threat, but also its existing Abbot Point coal terminal, which sits near Bowen, behind the Great Barrier Reef.

The campaign against the mine has been long. Environmentalists first tried to use Australia’s environmental laws to block it from going ahead, and then failing that, focused on pressuring financial institutions, first here, and then around the world.

The news that Beijing has left Adani out to dry comes as on-the-ground protests against construction of the mine pick up. Two Greens MPs, Jeremy Buckingham and Dawn Walker, have been arrested in Queensland for disrupting the company’s activities.

Is China’s move the end of the road for Adani’s mega coalmine in Australia, and will the Adani Group be left with billions of dollars in stranded assets?.........

While threats to reputational damage were not effective against Adani Group, since it is family-owned, the same was not true of Australian banks, which were targeted heavily by activists.

And one by one, each of the big four Australian banks ruled out financing the mine.

The first of the big four banks declared it would not lend to the project two years ago. NAB distanced itself from the mine in September 2015 and ANZ followed suit in December.

Then in April this year Westpac became the third of the big banks to rule out funding the project, drawing criticism from resources minister, Matthew Canavan, who said the bank had a conflict of interest because of its interest in other coal-producing regions, and called for a boycott of the bank.

Undeterred, and in the face of a large campaign by environmental groups, the Commonwealth bank followed suit in August this year.

By then Adani had seen the writing on the wall, and had shifted to seek finance from overseas institutions. It entered negotiations with the state-owned China Machinery Engineering Corporation (CMEC), which was thought to raise the potential of subsidised Chinese government loans.

The Australian government, which was seeking to give Adani its own subsidised loan, had supported the company’s efforts in China, according to a freedom of information request by the Australia Institute that reveals “several hundred pages” relating to formal representations to foreign financiers by the Department of Foreign Affairs and Trade…….

It should come as no surprise that the Adani Group is offering traditional owners compensation which is well below industry standard

" We, the Wangan and Jagalingou people, are the Traditional Owners of the land in Queensland’s Galilee Basin. Corporate conglomerate, Adani, wants to use our ancestral lands for their Carmichael coal mine.

We do hereby firmly REJECT a Land Use Agreement with Adani for the Carmichael mine on our traditional lands.

We DO NOT consent to the Carmichael mine on our ancestral lands.

We DO NOT accept Adani’s “offers” to sign away our land and our rights and interests in it. We will not take their “shut up” money.

We will PROTECT and DEFEND our Country and our connection to it." [http://wanganjagalingou.com.au/our-fight/]

ABC News, 1 December 2017:

A hotly contested deal between Adani and traditional owners of its proposed Carmichael mine site in Queensland's Galilee Basin would deliver compensation "well below" what most big miners pay, according to a new analysis.

The Wangan and Jagalingou (W&J) people would only get 0.2 per cent of Adani's earnings from the mine, less than half the industry average, respected mining industry outfit Economics Consulting Services has found.

Its report, obtained by the ABC, was commissioned by six W&J representatives whose looming court challenge to the deal stands as the final legal hurdle to Adani's contentious mega-mine.

It found the W&J people would earn up to $145 million over 30 years, out of the project's estimated $77.4 billion in gross revenue, a share which was "well below industry benchmark standards".

The benchmarks for such deals usually ranged from 0.75 per cent to 0.35 per cent.

Only 11 per cent of the deal would come to the W&J people in cash, up to $17.4 million over 30 years, or about $2,300 a year per adult member of the clan.

Report author Murray Meaton, who was awarded an Order of Australia in 2014 for services to the mining industry, found the benefits to the W&J people would be "dramatically lower" if job promises for locals fell short as they did "in most jurisdictions and agreements".

To gain finance for the $21 billion project, Adani needs an Indigenous Land Use Agreement (ILUA) with the W&J people, or it must call on the Queensland Government to forcibly extinguish any native title claim over the mine site in the Galilee Basin…….

The Adani supporters in the W&J have argued the mine is inevitable and they need to seize the miner's offer to economically benefit their people, including some who live in Queensland's more disadvantaged communities.

However, the anti-Adani group object to the destruction of their ancestral lands and culture, and contest the legitimacy of the meeting that approved the Adani deal.

The dispute will go to trial in the federal court in Brisbane in March.

The case has pushed back Adani's deadline on clinching finance for the project, which remains in doubt.

Wangan and Jagalingou have been defending their country in court since at least 2008.

#WanganAndJagalingou #WandJclaimants again vote down #AdaniDeal, #seekInjunction
~ Claim group #RejectILUA for the fourth & final time
~ #Injunction filed #againstAdani & #QldGov #AboriginalLandRights #AboriginalSovereignty
WGAR https://t.co/4lBiG5bV1dhttps://t.co/MPrkIUXqKn pic.twitter.com/5h7zIQrcOz

— WGAR News #AboriginalRights AltMediaMonitor (@WgarNews) December 3, 2017

The Guardian, 3 December 2017:

Traditional owners opposed to the Adani Carmichael coalmine have filed an application for an injunction with the federal court to prevent the native title tribunal from signing off on an Indigenous land use agreement before the outcome of a court challenge.

The application was filed following a meeting of the W&J traditional owners council in Brisbane on Saturday, where the 120 attendees voted against the Ilua for the fourth time since it was proposed in 2012.

Echo NetDaily, 6 December 2017:

North Coast Greens MLC Dawn Walker and NSW Greens mining spokesperson Jeremy Buckingham were arrested yesterday by Queensland police after taking part in a blockade of the Adani Carmichael coal mine rail construction site at Belyando, 270km west of Bowen.

The MPs were arrested at 6:35am along with a dozen other climate activists and charged with trespass unlawfully on a place of business.

Ms Walker said, ‘It was a very important day for me, stopping work on the Adani mine and being arrested with climate activists who understand the importance of preventing this destructive project from going ahead,’ said Greens MP Dawn Walker.

‘I was proud to stand with traditional owners who have said ‘no means no’ to Adani, and made it clear they will not be surrendering their land and water to this coal corporation.

‘Although this mine is miles from anywhere, the eyes of all Australia are on it. We have travelled days to get here but believe many more will follow.

Coal needs to be consigned to the scrap book says former executive director of the United Nations Framework Convention on Climate Change

These issues get reported in mainstream media but are falling on the deaf ears of monumentally ignorant Turnbull Government minsters, senator and MPs.

ABC News, 27 November 2017:

The woman who led the world to a global climate change agreement has a message for Australia: "You really do have to see that we are at the Kodak moment for coal."

Christiana Figueres, until last year the executive director of the United Nations Framework Convention on Climate Change, doesn't mean happy snaps for the family album.

Rather, the decimation of the once dominant photographic company Kodak by digital change — in the same way that coal-fired power is being eclipsed by renewable energy.

She hopes to see coal, like those sentimental moments in time captured in photographs, confined to history — with the world remembering the contribution the fossil fuel has made to human development, while recognising the need to retire it as a fuel source because of its contribution to global warming.

And, she says, it's happening.

"The fact is that we are already seeing the decline of coal, we are seeing more and more countries phasing out of coal," Ms Figueres, who is based in London, told the ABC.

"We just had 25 countries come together [at the latest international climate change talks] in Bonn to say that they are moving out of coal in the short term.

"That does not include Australia or India or China, but you can begin to see the trend…..

Which makes arguments that India needs the coal from Adani's planned mega-mine in North Queensland — and the Federal Government's determination to see the mine ahead — baffling to Ms Figueres.

The Government's Northern Australia Infrastructure Facility, or NAIF, is considering Adani's request for a subsidised loan of up to $1 billion to help it build a railway to connect the Carmichael mine in outback Queensland to the Abbot Point Coal Mine near Mackay, which Adani also owns.

By law, the NAIF is not permitted to make loans for projects that would damage Australia's international reputation.

Earlier this month, Ms Figueres wrote to the NAIF arguing that providing such a loan for a project that would significantly add to greenhouse gas emissions would do just that.

"I wrote to NAIF because I am very concerned about the fact that NAIF could still be considering giving a concessional loan to the Adani Group to allow them to extract profitably from the Carmichael coal mine and transport that coal all the way to the Abbot Point Coal Terminal," Ms Figueres said.

"First of all, it has huge environmental impacts. The more coal we burn, the further away we are going to be from the targets established in the Paris agreement [to keep atmospheric temperature rises well below 2 degrees above pre-industrial levels].

"But also, the more coal we burn around the world, independently of where it is going to be burned, the more negatively we are affecting public health.

"Now we have this issue of the Carmichael coal mine which, if it goes ahead, would frankly blow completely out of the water any emissions reductions that Australia has committed to.

Saying NO! to fracking in the Territory

Heard from the ones that would be forced to live in #fracking gasfields?@TurnbullMalcolm @thepmo @ScottMorrisonMP #auspol @JoshFrydenberg pic.twitter.com/xiguRmG7tp

— Lock the Gate (@LockTheGate) October 15, 2017

Castle Hill, Townsville carries the message "STOP ADANI"

A major heritage-listed landmark shows that not everyone in Townsville, Queensland, appears to be happy with becoming a mining FIFO dumping ground hub for the financially dubious multinational Adani Group ……

Castle Hill aka Cutheringa Mountain est elevation 264 metres

Image: Townsville Bulletin, 16 October 2016

Via @VanOnselenP

In the face of the growing threat of climate change sometimes Australian politicians leave me speechless

The Guardian, 9 October 2017:

The New South Wales government will introduce legislation to approve an underground coalmine that was blocked by the courts because it was polluting Sydney’s drinking water.

On Monday the state’s energy minister, Don Harwin, announced the government would overturn a decision by the NSW court of appeal to block the extension of the Springvale colliery.

The mine, owned by Centennial Coal, is the sole supplier to Lithgow’s Mount Piper power station, which provides about 10% of NSW’s electricity.

On Monday Harwin said the mine was “vital for energy security and affordability”.

“My top priority as energy minister is to ensure NSW households and business have an affordable, secure and reliable energy supply – this decision supports that,” he said.

The legislation, which is expected to be introduced to the parliament this week, will change the NSW Environmental Planning and Assessment Act to “clarify” that “projects in the Sydney water catchment seeking to expand must maintain or improve water quality compared to their existing consent”.

It will also specifically validate the Springvale mine’s state significant development consent.

The government’s planning minister, Anthony Roberts, said the legislation would “support the construction of a water treatment plant” which he said would eliminate saline discharges.

“This new treatment plant will see zero mine water discharge into the Coxs river, is supported by the EPA and WaterNSW and has separately been approved by the independent Planning Assessment Commission,” he said.

In August the court of appeal determined that the mine was polluting Sydney’s drinking water and therefore operating on an invalid licence.

After a challenge by environment group 4nature, the court found the commission had erred in approving the licence because it involved discharging polluted water into Sydney’s drinking catchment.

The approval involved saline mine water being discharged into the Coxs river, which flows into Lake Burragorang, Sydney’s major drinking-water reservoir.

Liberal Member of the Legislative Council, Minister for Resources, Minister for Energy and Utilities, and Minister for the Arts, Vice-President of the Executive Council, Donald Thomas HARWIN, BEc(Hons) MLC – parliamentary bio.

Liberal Member for Lane Cove, Minister for Planning, Minister for Housing, and Special Minister of State, Leader of the House, Anthony John ROBERTS, MA (Comms) MP – parliamentary bio.

WA company with Chinese & UK backing announces a desire to mine near, extract water from and potentially pollute Clarence River catchment waters

Corazon Mining Limited exploration site

The Daily Examiner, 29 September 2017, p.1:

JUST 35km north-west of Grafton is a block of private land with the potential to change the face of Clarence Valley’s industry as we know it.

Mt Gilmore, which lies between Fine Flower and The Gorge, has been revealed to be home to several deposits of high-grade cobalt.

Now Western Australia-based company Corazon Mining is trying to work out just how big that deposit is, and whether it’s worth mining.

On June 16 2016, Corazon announced it had secured the right to earn up to 80% of the Mount Gilmore Cobalt-Copper-Gold Project from private company Providence Gold and Minerals Pty Ltd.

Their project tenure included one granted Exploration Licence covering an area of approximately 25km by 15km, and over the past couple of months they have been drilling to in an effort to find precious metals.

Corazon managing director Brett Smith said so far, things were looking good.

“We’ve been saying that this is one of the highest- grade cobalt deposits in Australia, we just don’t know how big it is,” he said. “There was a lot of gold and copper prospecting there back in the late 1800s, early 1900s, and so it’s amazing where it’s located how little modern exploration has gone on there.”

The reason they have their eye on cobalt, rather than gold or copper, is that the element’s value has risen exponentially in recent years due to its use in lithium-ion batteries.

Mr Smith said demand from the battery sector had tripled in the past five years and was projected to double again by 2020.

It is most commonly used in smartphones, laptops, and electric vehicles.

“Cobalt is the most expensive raw material used for building lithium-ion batteries, paying about $61,000 per tonne,” Mr Smith said.

“A lot of people have been exploring for cobalt in NSW but are looking at oxide deposits. Ours is a bit different in that it’s a sulphide deposit, and they are fairly rare to be cobalt dominant.

“It’s all in vogue at the moment so we’re pretty hopeful this can be used to produce cobalt salts for batteries.”

Mr Smith said the company was currently on its second drill program, which they hoped could be used to accurately determine the lay of the land.’

Exactly what mining exploration licence is this newspaper article talking about?

Well according to NSW Planning & Environment on 1 September 2017 it is  EL8379 granted to Mt Gilmore Resources Pty Ltd on 23 June 2015.

So who is Corazon  Mining Limited?

The company’s 2016-17 Annual Report states:

Corazon Mining Limited (ASX: CZN) (“the Company” or “Corazon”) is an Australian based company exploring and developing the Lynn Lake Nickel-Copper-Sulphide project in Canada and Mt Gilmore Cobalt-Copper-Gold project in Australia.

It has three main exploration projects -  the Lynn Lake and  Victory projects both in Manitoba Canada and the Mt Gilmore Project in NSW Australia.

This is the corporations current Board of Directors:

Clive Jones, Non-Executive Chairman - 4,235,330 fully paid ordinary shares, 5,000,000 options exercisable at $0.035 expiring 31 March 2020, total annual remuneration $154,607

Brett Smith, Executive Managing Director - 7,107,131 fully paid ordinary shares, 10,000,000 options exercisable at $0.035 expiring 31 March 2020, total annual remuneration $417,250

Adrian Byass, Non-Executive Director - 9,357,370 fully paid ordinary shares, 7,000,000 options exercisable at $0.035 expiring 31 March 2020, total annual remuneration $144,600

Jonathan Downes, Non-Executive Director - 11,154,512 fully paid Ordinary Shares, 5,000,000 options exercisable at $0.035 expiring 31 March 2020, total annual remuneration $190,557

Mark Qiu, Non-Executive Director (appointed 18 August 2017) - 1,269,300 fully paid ordinary shares, total annual remuneration unknown

Robert Orr is company secretary and Chief Financial Officer, shareholding unknown, total annual remuneration $114,360.

The last annual report indicated that the company share structure comprised 1,039,283,317 fully paid ordinary shares held by 2,135 individual shareholders and, 60,000,000 unquoted options are held by 10 individual option holders.

The largest options holders are Brett Smith with 10 million held and Zenix Nominees Pty Ltd with 20 million held.

On 1 December 2016 the Company announced the issue of 3,410,840 shares to key management personnel in lieu of cash-based salary. This strategy was implemented in order to conserve cash reserves for operational expenditure.

Corazon Mining appears to be operating at a loss and apparently paid no tax in 2016-17.

Corazon Mining Limited’s Purchase Agreement for the Mt Gilmore Cobalt-Copper-Gold joint venture project:

Under the terms of the agreement with Providence and subject to Corazon completing due diligence to its sole satisfaction on or before 30 June 2016, Corazon has the exclusive right to earn up to an 80% interest in the Project as follows:

Corazon can earn an initial 51% interest by:

* Issuing Providence 25 million Corazon Mining Limited shares

* Paying cash reimbursements of costs totalling $100,000

* Spending $200,000 on exploration within the first 12 months from the date of satisfaction of all conditions precedent (“Commencement Date).

Corazon can earn a further 29% interest (totalling 80%) by:

* Completing $2M  in exploration within 3 years of the Commencement Date

* Paying $150,000 in cash or shares upon the earlier of the commencement of the third year and Corazon spending a minimum of $500,000 on exploration

* Paying $250,000 in cash or shares upon earning 80% equity in the Project.

Corazon has the opportunity to extend this earn-in period by one year by paying $50,000 in cash or shares.

According to Corazon Mining;

The Project is located only 35km from the major centre of Grafton in north-eastern New South Wales. Project tenure includes one granted Exploration Licence (EL8379 – one year old), covering an area of approximately 25km by 15km……

On 22 August 2017 the Company issued 139,856,665 fully paid ordinary shares at an issue price of $0.014. The share issue was comprised of:

- an issue of 120,000,000 shares to Hanking Australia Investments Pty Ltd under a Subscription Agreement for a $1,680,000 investment in the Company;

- an issue of 7,356,665 to sophisticated investors to raise $102,993; and

- an issue of 12,500,000 shares to Providence Gold and Minerals Pty Ltd pursuant to the Company’s Earn-in Agreement with Providence in respect of the Mt Gilmore Project. Under this Agreement, Corazon has the exclusive right to earn up to an 80% interest in the Project. The shares have a total valuation of $175,000.

On the same date, the Company also issued 85,000,000 options to Hanking Australia Investments Pty Ltd following their investment in the Company. The options were issued with an exercise price of $0.03 and an expiry of 22 August 2019.

On 18 August 2017, Dr Mark Qiu of Hanking Australia Investments Pty Ltd was appointed to the Company’s Board of Directors.

China Hanking Holdings Limited, registered in the Cayman Islands and listed on the Hong Kong Stock Exchange, is the parent company of Hanking Australia Investments Pty Ltd.

The second largest shareholder in Corazon Mining Limited is Crescent Nominees Limited, a private equity firm registered in Northern Ireland since 2014 and owned by venture capitalist Crescent Capital NI Limited.

As part of NSW Minerals Week Corazon Mining Limited had a booth at the 14th Sydney Resources Round-Up in May 2017 where interested geologists could view their sulphide core from the 2016 Cobalt Ridge drilling program. 

Area in which the proposed cobalt mine would be situated

Satellite image of Mount Gilmore (height 372m) situated just above the Clarence River system at The Gorge

It doesn’t take a genius to look at this image and see the potential for heavy rain episodes over Mt. Gilmore leading to surface water runoff into Clarence River tributaries.

So the first question is; what happens if Corozon Mining was granted a mining licence by the NSW Berejiklian Coalition Government and one or more of its heavy metal contaminated holding ponds were breached during such a rain period? The potential exists for any such breaches to result in long-term contamination of surrounding soils and water courses, as well as higher sediment levels in surface waters.

Heavy metal and metalloid concentrations within stream-estuary sediments already occur naturally in NSW north-eastern coastal rivers and current Clarence River levels are also the result of historic mining in the upper catchment below the Dorrigo Plateau region.

This leads to a second question. Can a river system, which supplies drinking water to est.126,008 residents (Census 2016) along with water to farmers, graziers and commercial fishers in the Clarence Valley and Coffs Harbour City local government areas, safely tolerate higher heavy metal and metalloid concentrations in that water? Communities relying on the Clarence river system might not be happy with the thought of any increase in localised or overall toxicity.

Given that mining is a thirsty business and water used in its extractive processes has to come from nearby surface/groundwater sources, there is a third question which immediately springs to mind. In the face of increasing impacts from climate change can we afford to have the environmental water flow in the Clarence River system compromised further?

Then there is the question of required associated infrastructure, including transport of ore via trucks and rail – need I say more?

One has to wonder when Clarence Valley Council was going to mention this proposed mining activity to residents and ratepayers because it is highly likely that this mining company or someone acting on its behalf has approached either the Mayor or council administration.

UPDATE

NSW Planning & Environment mapping of EL8379

https://minview.geoscience.nsw.gov.au/#/?lat=152.64729140322308&lon=-29.387643207430074&z=11&bm=bm1&l=mt2%3Ay%3A100