A HONG Kong-based company has applied to renew a controversial Hunter coal exploration licence while under investigation over a secret $5 million community fund and as the NSW Government stands to lose a $175 million special payment if the coal mine is not approved.
Ridgelands Resources applied to renew the Muswellbrook licence on February 23, only four days before the five-year licence signed by former NSW minister Chris Hartcher expired, and only months after Ridgelands’ failure to establish a $5 million community fund, as required under the exploration licence, was revealed.
Five years after the Independent Commission Against Corruption called for sweeping changes in coal exploration licence allocation and renewal processes after damning inquiries into corrupted Hunter coal exploration licences, the NSW Government has failed to act on key recommendations, including for licence renewals.
The ICAC found “inconsistency and uncertainty” in how renewals were processed that was “an incentive for improper behaviour”.
The NSW Opposition has ramped up calls for an inquiry into the Ridgelands case after the company failed to establish the $5 million fund according to consent conditions, government departments failed to enforce the condition for nearly five years, and after freedom of information requests for department documents on Ridgelands were rejected.
Energy Minister Don Harwin last week declined to directly respond to a question about whether he had confidence in the rigour of the state’s processes for recording and monitoring mine licences and conditions of consent.
These scarce minerals are owned by the people of NSW. Permission to exploit those resources should be granted only with the most rigorous transparency and competitiveness.Muswellbrook mayor Martin Rush
It followed his confirmation that under the wording of the 2013 agreement Ridgelands was required to establish the $5 million fund, which it controls, within the five years of the exploration licence term, but “there is no requirement under the licence for the funds to be allocated” to the community.
This is despite the fund being a factor in the company winning the licence over more than 7600 hectares of land 18km north of Denman.
Ridgelands put $500,000 into the fund in October, another $500,000 on January 25 and $4 million on February 9, but has so far allocated only $550,000 to community groups. On its website it has set an April deadline for fresh community fund applications.
In a statement to the Newcastle Herald Mr Harwin’s office confirmed it was only in October – after a years-long coal boom and damning ICAC inquiries into government handling of coal resources – that the NSW Government initiated a new mining and exploration titles conditions register to shift a paper-based system to a computerised form.
The new system was introduced three months after Ridgelands made an unsolicited offer of $500,000 to Muswellbrook Shire Council in lieu of the $5 million community fund which the council had not known about, despite Ridgelands being required to advertise the fund from 2013 and provide regular reports back to government departments.
The $500,000 offer came one month before Ridgelands applied to the Department of Planning for exploratory drilling at seven locations, with indications it would apply to renew the exploration licence when it expired in February.
Muswellbrook Council’s Supreme Court action to recover the full $5 million for community projects prompted the Department of Planning’s division of resources and geoscience to refer the matter to the Resources Regulator for investigation in August.
The community fund saga also revealed that the company that secured the Ridgelands exploration licence in 2010 after the then NSW Labor Government called for expressions of interest, the Botai Consortium, offered the government “additional financial contributions”, including $175 million within one month of a final mine development approval.
Muswellbrook mayor Martin Rush said he was “confident there will come a time in NSW where a new government commissions a special inquiry into the regulation and renewal of the Ridgelands exploration licence”.
The NSW Government should use this opportunity to extinguish the lease and protect this beautiful valley from mining.Lock the Gate spokesperson Steve Phillips
“The whole Ridgelands process has been characterised by a lack of transparency from the very beginning,” Mr Rush said.
The offer of $500,000 to the council raised questions about communications with Ridgelands leading up to the renewal application, and rejection of the council’s freedom of information applications provided evidence that transparency concerns raised by ICAC five years ago remained, Mr Rush said.
“The Ridgelands exploration licence should be the subject of a new transparent and competitive auction in line with the recommendations of ICAC,” he said.
“The licence issued to Ridgelands was not complied with in a fundamental way. There is a real suspicion in the community that the NSW Government will renew the licence without a transparent and competitive process and that it will do so in exchange for Ridgelands fulfilling its existing obligations.
“These scarce minerals are owned by the people of NSW. Permission to exploit those resources should be granted only with the most rigorous transparency and competitiveness.”
Lock the Gate Hunter spokesperson Steve Phillips said the expiry of the licence was an opportunity to protect the Wybong land covered by the Ridgelands title.
“The NSW government should use this opportunity to extinguish the lease and protect this beautiful valley from mining. Ridgelands contains mapped strategic thoroughbred breeding land, mapped strategic viticultural land, and mapped strategic agricultural land - all of which this government promised to protect from mining. Well, now is their chance,” Mr Phillips said.
“The mining company has failed to carry out the conditions of the exploration lease, and the department has failed to enforce them.
“The NSW Government should show the people of NSW that things have changed in this state since the ICAC mining corruption scandals. Show us that you meant something when you said you'd protect strategic farm land from mining.”
In his statement Mr Harwin said the Coalition Government had taken steps to improve the tracking and enforcement of title conditions, including through an online portal where exploration and mining titles, including the Ridgelands title, had been accessible to the public since 2015.
The Department of Planning’s division of resources and geoscience “has taken significant steps towards the establishment of an electronic system that will support the more efficient and effective administration of resource titles”, Mr Harwin said.
Ridgelands Resources did not respond to a request for comment.