SYDNEY - A bid by Chinese coal giant Shenhua Group to build a A$1.2 billion (S$1.28 billion) mine near a stretch of Australia's richest farmland has triggered fierce debate about whether the nation's land should be used for "mining or dining".
The battle has focused on the fertile land of the Liverpool Plains in north-west New South Wales, which produced about A$2.4 billion worth of food and agricultural produce last year, including wheat, corn and sorghum.
The area's black soil is some of the richest in the world, with government data showing that the plains are about 40 per cent more productive than other Australian farmland.
But the land is also rich in valuable coal deposits.
Shenhua Group, one of the world's biggest coal producers, proposed to build an open cut mine in the area six years ago and finally won approval in January from the New South Wales state government.
The mine would include three pits which could produce about 270 million tonnes of coal over the next 30 years.
But farming groups have been vocally opposed, saying the 3,500ha mine will limit the use of valuable farmland and could damage water reserves.
The debate comes at a delicate political time, ahead of the New South Wales state election on March 28, and has opened simmering tensions between farmers and miners. Australia, with its vast territory and relatively small population, is a net food exporter, but has also enjoyed the benefits of a decade-long mining boom, which has started to fade.
The president of the NSW National Farmers Federation, Mrs Fiona Simson, said the Shenhua mine could "decimate" the region's aquifer system. She said the land's deep soil and shallow water allows for irrigated and non-irrigated farming and its rare properties are matched only by some of the fertile farmland in Ukraine.
"The Liverpool Plains has a unique water-holding capacity," she told The Straits Times. "It stores moisture amazingly and is fantastic for growing crops."
Mrs Simson said the local farmers' joke was that "you could put a feather in the soil and it will come out as a rooster". But the mine will "blow up" one of the ridges and potentially upset the fragile make-up of the land and damage the aquifers, she said.
"We don't think Shenhua have properly tested the connectivity of the ridges to the plains," she said. "The potential of the aquifer could be devastating for agriculture that provides billions of dollars to the state's GDP (gross domestic product) as well as for the water utilised by communities and towns."
Shenhua has already spent more than A$700 million on the mine, including about A$300 million for an exploration licence in 2008 and more than A$200 million on buying at least 37 farms believed to cover about 15,000ha. Extensive funds have also been spent on planning studies and environmental assessments.
The company says it has done in-depth analysis and denies the claims that the mine will damage the farmland, saying it would be built on ridges away from the farms on the plains. It says the project will bring 600 jobs during construction, 434 jobs during the mine's operation, and about A$900 million worth of spending each year on the project for decades.
"We have been through a detailed and independent assessment process over many years which has placed significant emphasis on ensuring there are no unacceptable risks to groundwater," project manager Paul Jackson told The Straits Times.
The New South Wales state government's independent planning commission endorsed the mine in January, saying the project would not intrude on the area's rich soil.
But farming groups rejected the commission's report, saying there was not enough data to support its findings.
The controversy, coming ahead of the NSW election, poses a threat to the ruling Liberal/National coalition, especially the rural-based National party which relies on support from farmers.
The federal coalition government was due to give a final decision on the mine just fifteen days before the state election, but has now delayed the decision.
This article was first published on March 10, 2015.
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