Presentation to the Planning Assessment Commission...WorleyParsons Hansen Bailey Technical specialist consultants Visitor inductions & Housekeeping Oneway Moment Agenda 4 1. Background

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Bylong Coal Project 10 May 2017

Presentation to the Planning Assessment Commission

PAC Site Visit Itinerary

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9:30 Welcome, Safety Moment & Introductions

10:00 Project Presentation

11:15 Site Tour (with Lunch)

2:00 Close Out Discussions

Introductions & Housekeeping

3

Introductions

PAC

Representatives/Visitors

KEPCO

WorleyParsons

Hansen Bailey

Technical specialist

consultants

Visitor inductions &

Housekeeping

Oneway Moment

Agenda

4

1. Background

2. Project Description

3. Stakeholder Engagement

4. Benefits of the Project

5. Mine Plan Justification

6. Workers Accommodation Facility

7. Key Areas of Focus

• Water

• Agricultural Resources

• Heritage (European and Aboriginal)

• Social

• Other

8. Conclusion

9. Site Tour

Project Background

5

Authorisations granted to Austen & Butta 1982/84

Acquired by KEPCO 2010

Targeted local stakeholder engagement & land acquisition from 2011

Exploration and environmental monitoring commenced 2011

PFS (multiple mine plan options) completed Mid 2012

Background Doc. and Gateway Application lodged Jan 2014

EIS lodged Sept 2015

Terms of Reference for PAC Review Issued Jan 2017

DP&E Assessment Report & Recommended Development Consent

Conditions released 5 April 2017

Project Background

6

Project Background

7

Project Background

8

Project Background –

Pre Feasibility Study

9

• Initial constraints

and mining

analysis refined the

potential open cut

mining areas to

seven

• Four potential

underground

mining areas

• Various

environmental,

social and

economic

constraints were

thoroughly

investigated to

develop proposed

mine plan

• Topography defines

the areas most

suitable for

underground versus

open cut



10


and mining


potential open cut

mining areas to

seven

• Four potential

underground

mining areas

• Various

environmental,

social and

economic

constraints were

thoroughly

investigated to

develop proposed

mine plan


the areas most

suitable for

underground versus

open cut



11


and mining


potential open cut

mining areas to

seven

• Four potential

underground

mining areas

• Various

environmental,

social and

economic

constraints were

thoroughly

investigated to

develop proposed

mine plan


the areas most

suitable for

underground versus

open cut



12


and mining


potential open cut

mining areas to

seven

• Four potential

underground

mining areas

• Various

environmental,

social and

economic

constraints were

thoroughly

investigated to

develop proposed

mine plan


the areas most

suitable for

underground versus

open cut

Overview of the Project

13 Conceptual Open Cut Mine Plans - Year 3


14 Conceptual Open Cut Mine Plans - Year 5


15 Conceptual Open Cut Mine Plan - Year 9


16 Conceptual Open Cut Mine Plan - Final Landform


17

KEPCO’s Stakeholder Engagement

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More than 2,500 direct interactions with stakeholders in Bylong since 2011

including face-to-face meetings, emails, phone calls, letters and presentations

Targeted engagement with government, business, residents, landowners,

community interest groups, 27 Registered Aboriginal Parties and others

Regular project updates via quarterly newsletters and information sessions,

project fact sheets, information briefs, web site updates and a dedicated site-

based community liaison team

KEPCO’s Stakeholder Engagement

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KEPCO’s Community Investment Fund commenced in 2011 and has

distributed more than $330,000 to community groups across the region, and

will continue to support local community service groups throughout the life of

the Project

Community Liaison Officers and other senior project staff continue to be

available to community members to address issues

KEPCO continues to provide regular updates via Project newsletters,

Community information sessions, fact sheet and website

Project’s 1800 phone number and email

Kane Smith with members

of the Rylstone Hospital Auxiliary

Benefits of the Project – BCA

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AUSTRALIA NSW

$1.86B Net Production

Benefits (undiscounted)

• $1,087M company tax

• $763M royalties

• $9M MWRC VPA

$846M Net Production

Benefits (undiscounted)

• $76M company tax

• $763M royalties

• $9M MWRC VPA

Direct & Flow Benefits of the Project

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• $624 million in annual business turnover

• $378 Million in annual value added

• $72 Million in annual household incomes

• 830 jobs including 290 direct jobs

• Employment of local workers

• Relocation of non-local workers & families

• Benefits gained through VPA ($9M)

• Upgrades to regional road network ($177K pa road maintenance)

• Sponsorship & donations

Other Benefits to MWRC LGA

MWRC LGA Direct & Flow On Benefits

22

Project Mine Plan Justification

Robust mine planning process implemented to develop the most appropriate “mine plan

and project description”, including:

Exploration activities (1984 to current) with activities accelerated over the past five

years;

Concept Study (Mar 2011);

Extensive Environmental Monitoring Program (2011 to current)

Pre-Feasibility Study (Jul 2012);

Preliminary Environmental Constraints Analysis (Nov 2012);

Options Study (Oct 2013); and

Feasibility Study (completed in Sep 2014).

Environmental, social and economic considerations have been implemented into the

Project design

Mine Plan changes have been made through the approvals process, including:

Reduction from seven to two OC Mining Areas (46% surface disturbance reduction)

WAF configuration & longevity

Mine plan scheduling to minimise noise impacts

Infrastructure design to reduce potential flood impacts

Commitments to additional environmental management and monitoring actions

23


Key requirements for the open cut mining component for the Project:

Accessible quality coal resource which occurs within lower slopes of the

valley outside the alluvial flats

Economic viability of Project hinges on the initial open cut mining

operations

Provides the most robust solution for the emplacement of reject

materials

Provides for an appropriate location for the management of mine water

throughout the life of the underground

Without open cut as proposed, the Project under the SSD Application would

not proceed.

An underground only option would not be viable in the current economic

environment

An entirely different approach would be required – different underground

mine plan with reject emplacement areas, tailings dams and infrastructure in

alternate locations

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Short term (~10 years) open cut impacts have been or will be appropriately

mitigated:

Acquired two of three receivers predicted to experience significant noise

Reached agreement for acquisition or have acquired five of six receivers

predicted to experience moderate noise

Ongoing discussions with remaining potentially affected landholders

Mine plan does not directly impact Tarwyn Park Homestead, Stables or the NSF

areas

Ongoing discussions with the descendants and in the advanced stages with NSW

Health to relocate burials upon receipt of SSD approval

Robust Biodiversity Offset Strategy developed to conservatively offset the

predicted direct impacts to ecological values within the open cut areas

Commitment to implement robust conservation management programs for items of

local heritage value

Robust rehabilitation strategy to be implemented to ensure the reinstatement of

BSAL and other land resources are appropriate for post mining agricultural

activities (including equine related activities)

Benefits of the Project

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0

100

200

300

400

500

600

700

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

Wo

rkfo

rce (P

ers

on

s)

Project Year

Underground Operations

Underground Construction

Open Cut Operations

Open Cut Construction

CHPP Operations

CHPP Construction

Construction workforce of up to 665 employees (average = 360)

Operational workforce of up to 470 employees (average = 290)

Specialised

Short-term

Workforces

Open cut workforce

for 8 -10 years

Longer term

Underground &

CHPP workforce

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Workers Accommodation

0

100

200

300

400

500

600

700

Month 1 Month 6 Month 9 Month 13 Month 17 Month 20

Accommodation Demand Against Supply (from RTS Assessments)

Short Term Accommodation Demand Short Term Accommodation Availability Long Term Accommodation Demand

Long Term Accommodation Availability Total Accommodation Demand Total Accommodation Availability

Short-term plus long-term accommodation available (461 beds) across Local Area

Scenario 1 (@4% rental vacancy rate, utilising 90% available) (295 beds) across the Local Area

Scenario 1 (166 beds) 25% vacancy in Mudgee and Rylstone and 50% elsewhere in the Local Area

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KEPCO is committed to ensuring that the Local Area receives the benefits from

the construction and operation of the Project

KEPCO is committed to its operational workforce residing within accommodation

available throughout the Local Area (if accommodation is available) as opposed to

a WAF as was initially proposed

Available data demonstrates that there is not sufficient accommodation available

within the Local Area for the forecast peak demand for construction workforce

Whilst it is possible (as MWRC has previously experienced) that the

accommodation market within the Local Area may provide sufficient

accommodation for the peak Project construction workforce, KEPCO is required to

manage the risks to its significant investment in the Project

KEPCO therefore is seeking approval of a mechanism in the approval for a WAF

to be utilised if at the time it is demonstrated that it is required for the construction

phase of the Project

Agenda

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1. Background

2. Project Description

3. Stakeholder Engagement

4. Benefits of the Project

5. Mine Plan Justification

6. Workers Accommodation Facility

7. Key Areas of Focus

• Water

• Agricultural Resources

• Heritage (European and Aboriginal)

• Social

• Other

8. Conclusion

9. Site Tour

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Key Areas of Focus – Water

The Project has been specifically designed to avoid impacts to productive

alluvial lands and neighbouring landholders water allocations within the

Bylong Valley

Five + years of baseline monitoring data utilised in assessments

Robust groundwater modelling which has extensively tested model

sensitivity and uncertainty utilising a vast range of inputs

Progressive model updates and refinements

Peer Reviewed (including model audit) with no new material issues identified

Modelling confirmed predicted water takes in accordance with existing

water licences (additional Permian licences required for underground)

Modelling confirmed no private landholder bores will be affected

Post-mining (with no void), some minor volumes of water to move

through rehabilitated mining area into alluvium

Beneficial use of alluvial groundwater not predicted to change

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Key Areas of Focus – Water

Water management system designed to contain all mine water

Sediment dams to treat sediment laden water prior to being released

Water balance confirmed the water management system is effective

and no discharges of mine water are predicted to occur based on

historic climatic conditions

Borefield makeup water utilised to supplement processing water,

primarily during open cut operations

Underground inflows to be managed within part of the open cut mining

void which contains sufficient capacity to accommodate the ~7,000ML

of predicted mine water

Flood assessment has confirmed all infrastructure positioned &

designed appropriately

Underground subsidence is not expected to result in material flood

impacts

32

Key Areas of Focus – Agricultural

Resources

Agricultural resources were a primary constraint considered during

Project design

Initially the alluvial floodplain was the primary constraint applied with the

later BSAL process resulting in amendments to the OEAs and

infrastructure for the EIS

Gateway Certificate was granted in April 2014 which contained

recommendations for assessment included in EIS

A Rehabilitation Strategy was developed for the EIS to ensure impacts to

agricultural land are appropriately managed

Project Disturbance Boundary and Biodiversity Offset Properties is

approximately 0.009% of agricultural land within NSW Best case $2.7 million per annum of agricultural production (which is 4% of that in MWRC

LGA, 0.02% of that in NSW and 0.005% of that in Australia)

KEPCO land outside the Project Disturbance Boundary and Biodiversity

Offset Properties will continue to be managed for agriculture

Farm Manager and team of farm hands already increasing production

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Resources

34


Resources KEPCO is committed to the implementation of

a leading practice Rehabilitation Strategy

Proposed reinstatement of 423.1 ha of BSAL to

the final landform

EIS Rehabilitation Strategy and BSAL

Reinstatement Strategy has been prepared

Rehabilitation Management Plan will be

prepared in close consultation with the relevant

regulators to the satisfaction of DRE

Conceptual rehabilitated final landform has

been designed to enable post mining land uses

to be generally consistent with those currently

occurring or have historically occurred

Predominantly cattle grazing

Equine CIC related uses

KEPCO has engaged academic institutions to

assist in ensuring the success of the mine

rehabilitation

35


Resources

76 km (~1 ½

hours drive)

from Scone as

the Regional

Centre for

Equine CIC

>10 km (30

minutes drive)

from closest

operating stud

36


Resources 1,933 ha Equine CIC within Project Boundary

467 ha of mapped Equine CIC to west of

Project Boundary

Equine CIC within and to west of Project

Boundary is owned by KEPCO

Project Disturbance Boundary contains 700

ha of Equine CIC

Offsets will impact 584 ha of land mapped as

Equine CIC, including 69 ha of cultivated land

No Thoroughbred horse breeding has

occurred on this mapped Equine CIC land for

many years

Former landowners have confirmed this:

"The property (Tarwyn Park) is now used

as a cattle raising farm operated by the

Andrew's family" (Peter Andrews quote in

Racing and Sport (2011))

Wallings Agricultural Company primarily

a cattle grazing enterprise

Tinka Tong – previously a cattle grazing

enterprise with some Stock Horses

37

Key Areas of Focus – Bylong Valley

Social

KEPCO has acquired a large portion of land within the Bylong Valley

Population declines and the associated social implications to the Bylong Valley as a

declining rural area were already occurring

Health and amenity impacts from the Project to remaining residents will be minimal

as a result of substantial buffer of KEPCO land

The Project during operation will result in interim changes to the character and

identity of Bylong Valley from rural to mining, these changes will be substantially

reduced following the completion of the initial open cut operations

KEPCO have:

Committed to operate the Bylong General Store for life of Project

Contributed to operating costs of Bylong Community Hall

Undertaken beautification and enhancement works at the Bylong Village

Appointed a Farm Manager and developed a comprehensive Farm

Management Plan for all KEPCO owned land

Provided financial and human resources support for the Bylong Rural Fire

Service

38

Key Areas of Focus – Heritage

No heritage items or sites within the Project Boundary listed on statutory UNESCO,

Commonwealth or NSW or Local government lists, registers or schedules

HHIA identified 18 sites assessed to be of heritage significance within and directly

adjacent to the Study Area (Authorisations)

The Project will result in direct impacts to seven sites assessed by the HHIA as having

conservation values at a local level, including Tarwyn Park Farm Complex

The following will be implemented for directly impacted items where appropriate:

• Archival recordings, including scaled drawings and photographs, prepared in

accordance with the relevant Heritage Office guidelines

• Test excavation, and salvage excavation (as determined by testing)

• Documentation, including photographic record

Blast Management Plan to be prepared for remaining items

Design of the open cut mining areas and infrastructure has incorporated measures to

mitigate potential visual impacts to some historic heritage sites

Upon granting of SSD approval, KEPCO is committed to preparing Conservation

Management Plans for:

• Tarwyn Park Farm Complex;

• Bylong Station Farm Complex; and

• Homestation.

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Tarwyn Park Farm Complex

Tarwyn Park Farm Complex (including Iron Tank) comprises the following features which have

been assessed to comprise local heritage value:

• Tarwyn Park Homestead (c. 1927)

• Stables (c. 1927)

• Various Farm Buildings

• Archaeological Site – rubbish mound

• Horse Burials

• Natural Sequence Farming (soil hydrology techniques) land use

The homestead, stables and farm buildings within the Tarwyn Park Farm Complex are to be

retained

The mine plan design results in the Project remaining off the Bylong River floodplain, where the

primary soil hydrology techniques (NSF) have been undertaken

A Blast Management Plan to be prepared:

• Various examples where blasting has been undertaken in proximity to heritage structures

(Liddell Coal – Chain of Ponds Inn; Wambo Mine – Wambo Homestead; Bengalla Mine –

Bengalla and Overdene Homesteads)

• Baseline dilapidation inspections have been completed on the heritage structures within the

Study Area

• KEPCO has recently remediated eroded sections of sandstone walls at Tarwyn Park in

preparation of the potential impacts

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Tarwyn Park Farm Complex

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Existing Property Management Actions

KEPCO has undertaken the following works since gaining access in August 2016:

• Agricultural Assessment and Land Management Plan – including soils and agricultural

capability assessment (in addition to one completed in March 2014)

• Dilapidation/baseline structural condition assessments

• Inspections and upgrades to the electrical wiring throughout the Homestead

• Reconstruction of the chimneys to Homestead which were in a dilapidated state

• Repairs/reconstruction of veranda posts

• Re-joining of sandstone walls around the perimeter of Homestead

• General tidy up of rubbish and maintenance around the homestead and stables

• Various agricultural land and water studies being conducted by academic institutions to

inform transferability to mine rehabilitation

KEPCO has an estimated, but as yet unbudgeted expenditure of more than $600,000 to

conduct the necessary immediate repairs to Tarwyn Park homestead, stables, timber framed

stables and rounding yard (rubbish and asbestos removal, septic installation, rising damp

remediation, etc).

42

Agricultural Land Management Plan

CSIRO, 2002 concluded:

“NFS has done little to address issues of native biodiversity and landscape ecology at Tarwyn Park.

There is low species diversity in the riparian and stream plant communities, and a near absence of

remnant native trees on the farmed hillslopes. These plant communities are therefore expected to

provide little habitat for birds and other terrestrial fauna.”

43

Agricultural Land Management Plan

44

Conservation Management Measures

for Implementation

KEPCO has committed to a number of conservation management actions during

the SSD approvals process to manage potential impacts to the Tarwyn Park

Farm Complex as a result of the Project, including:

• Management measures to be described within the Historic Heritage

Management Plan;

• Strategic Property Conservation Management Plan;

• Blast Management Plan, including baseline dilapidation assessment; and

• Rehabilitation Strategy and Biophysical Strategic Agricultural Land

Reinstatement Strategy – to include a trial of soil hydrology techniques on

rehabilitated lands.

KEPCO is committed to actively consulting with the relevant regulators in relation

to the implementation of these conservation actions

KEPCO has commenced the development and early implementation of a number

of these conservation management actions

45

Other Areas of Focus – Ecological

Offsets

The Project is a “Transitional Project” under the Biodiversity Offsets Policy for

Major Projects (Offset Policy) and the Framework for Biodiversity Assessment

(FBA) (OEH 2014)

SEARs were issued prior to the Offset Policy and FBA

EIS Ecological Impact Assessment applied the three former methods (offsetting

principles, Commonwealth guidelines and biobanking) to assess the impacts and

to provide appropriate compensation for unavoidable impacts

KEPCO agreed to complete the additional works required to apply the Offset

Policy and FBA to Project at the RTS stage

OEH noted to DP&E in correspondence dated 3 November 2016 that: “OEH is

pleased to inform you that all substantial biodiversity and Aboriginal cultural

heritage matters which required resolution prior to DP&E finalising assessment

have now been resolved.”

46

Other Areas of Focus – Ecological

Offsets

Biodiversity Offset Strategy will be

developed to ensure the Project’s

conservation objectives are met

BOS includes 4,116 ha of land with

approximately 3,825 ha of native

vegetation

BOS addresses the credits generated by

the application of the FBA and Offset

Policy to the Project

Various offset areas are to be subject of

Biobanking Agreements, exception of

Offset Area 5

Biodiversity Management Plans will be

developed to manage the impacts of

construction and operations of Project to

biodiversity values

47

Other Areas of Focus - Subsidence

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Conclusion

DP&E’s Assessment Report and Recommendations for conditions of approval are

generally achievable, measurable and enforceable and will not impact on the

viability of the Project

Some recommended conditions of approval are of concern and need to be

discussed further

Project will deliver material socio economic benefits the MWRC LGA, particularly

in areas where a source of employment is required urgently

Assessments have shown that impacts to the water and agricultural resources are

able to be appropriately managed in accordance with relevant regulatory

requirements

KEPCO has gone above and beyond to effectively manage the social impacts of

the Project

Direct disturbance to items of potential heritage value to be managed in terms of

the DP&E recommended conditions of approval

KEPCO is committed to developing the Project upon the receipt of the necessary

approvals so that its benefits can flow to the region as soon as possible

Invested over $650 Million already and will invest a further several billion dollars

over the life of mines development

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Site Tour

Documents

Presentation to the Planning Assessment Commission...WorleyParsons Hansen Bailey Technical specialist consultants Visitor inductions & Housekeeping Oneway Moment Agenda 4 1. Background