APPENDIXA–LEARDFORESTRESEARCHNODESUPPLEMENTARYSUBMISSIONVICKERYCOALPROJECT

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CASESTUDY:BATEAANDTHEIMPLICATIONSFORNOISEPOLLUTIONCONTROL

ACostComparisonofMaulesCreekCHPPandBoggabriCoalCHPP

MaulesCreekMineCHPP

APPENDIXA–LEARDFORESTRESEARCHNODESUPPLEMENTARYSUBMISSIONVICKERYCOALPROJECT

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INTRODUCTION

Publiclyavailableinformationhasbeenusedtocomparethelevelofinvestmentthatwasmadeby(then)AstonResourcesLtd(nowWhitehavenCoal)ondesigningandconstructingtheMaulesCreekCoalHandlingandProcessingPlant(CHPP)vstheinvestmentbyIdemitsuResourcesinthedesignandconstructionoftheBoggabriCoalCHPP,whichisnearbyintheLeardStateForestCoalMiningPrecinct.

PURPOSEOFCOMPARISON

ThisCaseStudyistoexaminethecostsofWhitehaven’slow-costCHPP,extensiveexceedanceswhichwasincludedinanEPAorderedMandatoryNoiseAudit.NoiseCondition12(a)oftheMaulesCreekMineConditionsofApproval,whichreads:

“AttenuationofPlant12.TheProponentshall:

(a)ensure...allequipmentandnoisecontrolmeasuresdeliversoundpowerlevelsthatareequaltoorbetterthanthesoundpowerlevelsidentifiedintheEA,andcorrespondtobestpracticeortheapplicationofthebestavailabletechnologyeconomicallyachievable”

TheintentionofthePlanningAssessmentCommissionininsertingthisConditionistorequireMaulesCreekminetoimplementcontinuousimprovement.Theuseoftheterm“bestavailabletechnologyeconomicallyachievable”–orBATEA-isanexplicitrequirementthatwasnotaccidentallyinserted,andaimstoensurethatasthemineevolves,thecompanycontinuestoimproveitsenvironmentalperformance.

In2017,followingtheMandatoryNoiseAudit,WhitehavenCoalattemptedaModification(MOD4)toremoveCondition12(a)butafterafloodofsubmissionsbythecommunityarguingagainstsuchModification,itwassubsequentlywithdrawn.

WhitehavenCoalhasregularlytolditsshareholdersthatitaspirestobe“Australia’slowestcostcoalproducer”.

InthehearingconductedbytheNSWIndependentPlanningCommission(Dec2018)withWhitehavenCoalanditsconsultants,noiseconsultantJohnWassermanofWilkinsonMurraysaidthemodellingfortheVickeryExtensionProjectusedanassumptionoftechnologybeing“reasonablyfeasible”.

TheLFRNargues“reasonablyfeasible”isnotinthepublicinterestandahigherstandard,beingBATEA,shouldbeusedinnoisemodellingofVickeryExtensionProject.

WeareconcernedthatthelowerstandardoftechnologyusedinthemodellingishavingamisleadingeffectonthenoiseimpactsmodelledfortheVickeryExtensionProject.

WecallontheIPCtoinstructtheApplicanttore-modelthenoiseimpactsusingadifferentassumption,beingthatofBATEA.

APPENDIXA–LEARDFORESTRESEARCHNODESUPPLEMENTARYSUBMISSIONVICKERYCOALPROJECT

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COMPARISONOFDESIGNANDCONSTRUCTIONCOSTS

WeusedpubliclyavailableinformationtoascertaintherelativeinvestmentmadeintheCHPP’sofMaulesCreekandBoggabriCoalminescomparedwiththeirproductionoverthelifetimeofthemines.

Hereisthecomparisonofdesignandconstructioncosts:

PROJECTCHPP DESIGN CONSTRUCTION TOTAL$MMCCM $18.5M(Sedgman) $100M(Downer) $118.5MBOGGABRI $186M(Thiess-SedgmanJV) $186M

COMPARISONOFTOTALCHPPCOSTPERLIFEOFMINEPRODUCTION

ThelifetimeproductionoftheMaulesCreekmineisknowntobe362MtonnescomparedwithBoggabriCoal’s200Mtonnesofrecoverablecoal,makingMaulesCreek

PROJECTCHPP COALRESERVES TOTAL$M CHPPCOST/MILLIONTONNESMCCM 362Mtonnes $118.5M $0.33MBOGGABRI 200Mtonnes $186M $0.93M

Conclusion:TheinvestmentbyIdemitsuResourcesintheBoggabriCoalCHPPisalmost3xtimespermilliontonnesofrecoverablecoalproducedoverthelifeofthemine,thanthesimilarinvestmentbyWhitehavenCoalinMaulesCreekCHPP.

ThedifferencebetweentheinvestmentmadeatBoggabriCHPPvsMaulesCreekCHPPisclearlyofaveryhighorder,reflectingWhitehaven’sstatedgoalofbeing“oneofAustralia’slowestcostcoalproducers”.

Wesubmitthatthisgoalofbeinglow-costhashadademonstrableeffectonthecompany’sabilitytomitigatethenoiseimpactsofitsMaulesCreekCHPP,whichisasignificantsourceofthemine’snoiseproblems.

SOURCES:

MaulesCreek

Sedgmanwins$18.5millioncontractforAstonResources’MaulesCreekProject

“LeadingresourcesectorservicescompanySedgmanLimited(ASXCode:SDM)todayannouncedithasbeenawardedan$18.5milliondesigncontractforaCoalHandingandPreparationPlant(CHPP)atAstonResourcesLimited’s(ASXCode:AZT)MaulesCreekProject.

The$18.5milliondesigncontractiswithMaulesCreekCoalPtyLtd,anAstonResourcesLimitedsubsidiary,whichisthemanageroftheMaulesCreekProject.”

APPENDIXA–LEARDFORESTRESEARCHNODESUPPLEMENTARYSUBMISSIONVICKERYCOALPROJECT

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http://www.whitehavencoal.com.au/wp-content/uploads/pdf/SDM_Sedgman%20wins%20$18.5%20million%20contract%20for%20Maules%20Creek.pdf

Contractawardedhttps://www.australianmining.com.au/news/downer-wins-whitehaven-coal-maules-creek-chpp-construction-contract-2/

Boggabri

https://www.thiess.com/news/2013/thiess-sedgman-jv-wins-186m-chpp-contracthttps://www.australianmining.com.au/news/186m-contract-for-theiss-sedgman-jv/

EVIDENCETHATMAULESCREEKCOALMINECHPPISNOT“BATEA”

TheMaulesCreekmineMandatoryNoiseAuditwasimposeduponMaulesCreekminebytheNSWEPAinFebruary,2016.Throughout2015(thesecondyearofoperationofMCCM)over100exceedanceshadbeenrecordedbytheEPAatoneneighbouringpropertycausingtheEPAtoformtheviewthatit“reasonablysuspected”furtherexceedances.TheMandatoryNoiseAuditwasimposedbecause:

“(a)thelicenseehas,ononeormoreoccasion,contravenedtheconditionsofthelicenceinrelationtonoise;and

(b)theallegedcontraventionshavecaused,orarelikelytocause,harmtotheenvironment;

(c)activitiesatthepremiseshavebeenandarebeingcarriedoutinanenvironmentallyunsatisfactorymannerwithinthemeaningofsection95oftheAct”

AccordingtotheMaulesCreekMineMandatoryNoseAudit(section3.8.p40):

”ThesiteinspectionconfirmedthattheCoalProcessingPlantisnotenclosedandisessentiallyopenonallsideswithapartialroofcover...Nophysicalnoisecontrolmitigationwasthereforeevident.Wewereadvisedthatthebuildingstructurecouldnotsupportanenclosureretrospectively.”[Emphasisadded]

SincethensomeminormodificationshavebeenmadetoscreenthetrainloadoutfacilitywhichaccordingtotheGMMCCM,resultedina4dBreductionatsource,buthewouldnotanswerquestionsfromtheMaulesCreekCCCabouthowthismighthavetranslatedintoareductionatthereceiver.HetoldtheCCCthecompanydidnothavethecapabilitytotell,whichatthegiventimeisunlikely,asthecompanyhadreal-timenoisemonitoringwithaudiocapacity.

Inanycase,claddingandscreensarenotBestPractice.TheMandatoryNoiseAuditrecommends(atp.42)somemoresophisticated,engineeringbasedsolutionstothenoiseproblem,notjustscreens.However,Whitehavenhasneveradoptedsuchmeasures.

APPENDIXA–LEARDFORESTRESEARCHNODESUPPLEMENTARYSUBMISSIONVICKERYCOALPROJECT

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ThefactthattheCHPPwasunder-engineeredandcannotberectifiedobviouslycontradictsthestandardof“BestAvailableTechnologyEconomicallyAchievable.”Whitehavenisaprofitablecompanythatearnedover$525Mprofitlastfinancialyear(2018)andpridesitselfonbeingoneofthelowest-costcoalproducersinAustralia.

TheMaulesCreekCommunityConsultativeCommittee(CCC)wasinformedthattheCHPPisnotthesamedesignastheonewhichwasoriginallymodelledintheEA,whichwasmerelyan“indicative”design.ThiswasdisclosedtotheCCCbywayofexplanationastowhythesoundpowerlevelsarenotthesameastheEA.

ThisraisedthequestionofwhytheDepartmentofPlanningapprovedaCHPPsubstantiallydifferenttotheEAdesignthatithadchangedthesoundpowerlevelssosignificantly.

WedonotwanttoseearecurrenceofthisatVickery.

WHITEHAVENCOAL’SRESPONSETOSUBMISSIONSTOORIGINALMAULESCREEKPROJECT

IntheResponsetoSubmissions“Acoustics”,Whitehaven(thenreferredtoas“Aston”)stated1:

“AnumberofsubmissionswerereceivedinrelationtotheProjectchangingthequietruralcommunitytobeagiantindustrialzone.Further,OEHsubmitsthattheydonotagreewiththecommitmenttomeetthepredictednoiselevelswithinTable23oftheEAanddisagreethatfeasibleandreasonablenoisemitigationandmanagementmeasureshavebeenappliedtooperations.”[Emphasisadded]

Whitehaven/Astonwentontostate:“AsdescribedinSection7.3.4oftheEA,AstonhasdemonstratedthatfeasibleandreasonablenoisecontrolandmitigationmeasureshavebeenincorporatedintothenoisemodellingfortheProject.”

ThissuggeststhatWhitehavenarenottakingtheirnoisemitigationseriouslyandwefearthesamethingcouldhappenwiththeVickeryExtensionProject.

DespitetheOEH’ssubmissionthatitdidnotagreewiththeProponent’s“commitment”tomeetthepredictednoiselevels,anddisagreedthatfeasibleandreasonablenoisemitigationandmanagementmeasureshadbeenappliedtooperations,theMaulesCreekminewasneverthelessapproved,andexceedancescommencedalmostimmediatelydespiteonlybeinginYear1ofproduction.

1At4.3