In June last year, Coal & Allied informed the market that it was in the process of assessing the potential sale of the Oaklands 1.3 billion tonne coal deposit and that it had engaged corporate advisers to assist, but no buyer has been announced.

This has led to speculation that Coal & Allied would be stuck with the project and a backlash by rural and environmental groups.

Greens Wagga Wagga councillor Ray Goodlass said locals should be very concerned about mining expansion in the Riverina.

“If this project goes ahead there will be thousands more trucks on local roads,” he said.

The opposition to mining in the Riverina also encompasses Coalworks’ Oaklands project.

“The Oaklands coal project occurs within the Riverina bioregion and is part of the Murray Catchment Management Board area, which is dominated by river channels, floodplains, backplains, swamps, lakes and lunettes,” according to the local Greens branch.

“If these two mining ventures become operational, they would consume vast quantities of water, pollute the local environment, adversely affect the future viability of local water resources, increase dramatically the number of truck movements on local roads, and contribute to the state's increasing greenhouse gas emissions at a time when we need to be reducing our emissions.”

The relatively low quality of the thermal coal from Coal & Allied’s 1.3Bt deposit and market upheavals are believed to have further slowed down progress on the sale, which was expected to attract a field of local and overseas buyers.

Oaklands is an undeveloped deposit in the Southern Riverina district of NSW, for which Coal & Allied holds an assessment lease.

The deposit is strategically located near the NSW-Victorian powerlines and could be used for domestic power generation if it is developed into a 12 million tonne per annum operation.

Coalworks, which is keen on using its coal-to-liquid technology in its tenements in the Hunter Valley, was touted as a possible buyer because it could use technology it has the rights for to convert the low-quality coal into liquids.

Indian buyers were also believed to be interested in using the coal for their power stations because they use lower quality coals.