Subsidiary Shenhua Watermark has long considered that gaining state environmental approval is the biggest challenge facing the project.

While the New South Wales Department of Planning is yet to publicly release Shenhua’s major project application and supporting PEA, Watermark project director Joe Clayton said the PEA described the key social and environmental issues with the project.

Shenhua said once the PEA was accepted, it would then be placed on public exhibition at the department’s website.

Clayton added work on the next-stage environmental assessment report had started in parallel with exploration, monitoring, and various community and environmental assessment activities.

“Community consultation is a key factor in the preparation of the EA with a communications strategy in place to ensure stakeholders are engaged at the outset of the EA and feedback is incorporated throughout the preparation of the EA – not just at the end,” Clayton said.

“Watermark will be establishing three community reference groups (CRGs) focusing on koala management, water and the environment.

“These CRGs will have a hands-on focus and work directly with the project team to identify issues that need to be addressed in the EA.”

That environmental assessment report is expected to be submitted in late 2011.

Shenhua’s first major overseas development is targeting 10 million tonnes per annum of thermal coal production for at least 21 years.

The project is targeting 500Mt of inferred resources, stretches over 195 square kilometres and is only 35km from Gunnedah.

The company paid $A299.9 million to the NSW government in 2008 for the five-year Watermark exploration licence.

An initial exploration program by the state’s Department of Primary Industries was the only previous work done in the area at that time.