The proponent, Cobbora Holding Company Pty Ltd, is seeking planning approval for the Cobbora coal project, about 17km southwest of Dunedoo, to establish an open cut coal mine capable of producing up to 20 million tonnes of run-of-mine coal a year.

The mine is seeking to produce the equivalent to 12Mt of product coal for a period of 21 years and construct associated facilities, including a 28km rail spur line and a 26km water pipeline.

The mine would also need to close and realign public roads near the mine site.

“The department required the proponent’s environmental assessment to specifically address potential impacts on surface and ground water as well as agricultural land and land in the National Park Estate,” the department said.

“Other issues that the proponent was required to address include biodiversity, air quality, traffic, heritage, noise and blasting and socio-economic benefits and impacts.”

The NSW government intends selling the Cobbora coal mine to help fund its $30 billion infrastructure program, despite it being locked into uneconomic supply contracts and needing more than $1.3 billion to develop.

The government, which has indicated it also wants to sell the power-generation assets, will need to convince potential buyers the mine has long-term viability, despite the need for infrastructure linking its location to the coal supply chain in the Hunter Valley.

Budget papers reveal a $124 million investment in the mine, which it classifies as a public trading enterprise, would be needed this financial year. This would increase to $337 million in 2013-14, $609 million in 2014-15 and $106 million in 2015-16.