SHCAG Pty Ltd v Hume Coal Pty Ltd

Solicitors: Marylou Potts Pty Ltd (Applicant) Ashurst Australia (First Respondent) Crown Solicitors (Second Respondent) File Number(s): 40998 of 2014

Judicial review challenge to assessment of exploration licence under EPA Act

1. SHCAG Pty Ltd (SHCAG), the Applicant, challenges the decision of the New South Wales Minister for Resources and Energy (the Minister), the Second Respondent, to grant authorisation to Hume Coal Pty Ltd (Hume Coal), the First Respondent, to carry out coal exploration activities, specifically the drilling of boreholes, in the Southern Highlands of NSW. Exploration licences are issued under the Mining Act 1992 (NSW). The Minister must comply with the environmental assessment requirements in Pt 5 of the Environmental Planning and Assessment Act 1979 (NSW) (EPA Act) in processing any exploration licence that Part applies to.
2. These are judicial review proceedings in which the Court must determine if the Minister complied with the EPA Act as a matter of law. The Court is not empowered to consider the merits of the exploratory drilling program under challenge in these proceedings.
3. The following background facts are not in dispute. All approvals sought by Hume Coal and granted by the Minister have related to land the subject of Authorisation 349, a coal exploration licence for an exploration area located in the Sutton Forest, Exeter and Belanglo localities. On 6 May 2011 the Minister's delegate approved phase 1 exploration activities for drilling of up to 120 boreholes. On 4 September 2012 the Minister's delegate approved phase 2 exploration activities for the drilling of up to 90 boreholes. On 12 March 2013 the Minister renewed Authorisation 349.
4. On 7 March 2014 Hume Coal submitted the initial version of the "Hume Coal Phase 3 Exploration Activity Review of Environmental Factors" for phase 3 exploration activities to the Department of Trade and Investment (the Department), proposing the drilling of up to 90 boreholes. On 16 April 2014 Hume Coal submitted a Surface Disturbance Notice dated 15 April 2014 to accompany its application for proposed exploration activities. On 12 May 2014 the Minister's delegate decided that the proposed exploration activities as they then stood, would be likely to have a significant impact on the environment, with the consequence that an environmental impact statement (EIS) would be required before those proposed exploration activities could be approved.
5. On 15 July 2014 Hume Coal submitted to the Department for approval by the Minister a revised "Hume Coal Phase 3 Exploration Activity Review of Environmental Factors (REF 3)" application for phase 3 exploration activities proposing the drilling of 25 boreholes.
6. On 4 August 2014 the Department wrote to Hume Coal to request information regarding Hume Coal's community consultation to assist it in processing the pending phase 3 application. On 19 August 2014 Hume Coal provided reports on its community consultation activities to the Department.
7. On 26 August 2014 the Department wrote to Hume Coal to request that it make two changes to REF 3, include a specific date, and resubmit the document. Hume Coal submitted a further revised REF 3 to the Department on 29 August 2014. On 3 September 2014 the Minister's delegate purported to approve under conditions 2 and 3 of Authorisation 349 the phase 3 exploration activities comprising 25 drill holes subject to numerous conditions set out in the licence, inter alia. This approval is the subject of challenge in these judicial review proceedings. SHCAG seeks a declaration that the approval dated 3 September 2014 is void and of no effect.
8. The proposed 25 boreholes are located on eight properties which together represent approximately 16% of the total area of Authorisation 349. Five of the eight directly affected landowners have provided affidavits in support of SHCAG's application. They are Mr Alexander, Mr Martin, Mr Roche, Mr Pollicina individually and as a director of Fesen Pty Ltd. One of the eight properties is owned by Hume Coal. The drilling areas approved under phase 1 and phase 2 were not located on the properties of these landowners. The REF 3 refers to seven properties as it classifies the Pollicina and Fesen properties under the same property identification number.
9. On 25 March 2015 the Court went on a view of the five properties the subject of affidavit evidence in the proceedings and saw the general location of the proposed boreholes on each property. Twenty of the 25 proposed boreholes are located on these five properties, specifically, three boreholes on the Roche property, nine on the Pollicina and Fesen properties (three on the Pollicina property), six on the Fesen property, six on the Alexander property and two on the Martin property. The Court was also taken to the Koltai property where it was shown a cut and fill type road (Koltai Road), and a rehabilitated access track and borehole drill site. The Court was informed this road was built by Hume Coal at the request of the property owner. The Court travelled along Carters Lane. Maps used on the site became exhibit C.

Issues

1. SHCAG relied on the following three grounds of judicial review: 1. The Minister failed to examine to the fullest extent possible all matters affecting or likely to affect the environment by reason of that activity prior to approving the activity, contrary to s 111 of the EPA Act; 2. The Minister failed to take into account to the fullest extent possible all matters affecting or likely to affect the environment by reason of that activity prior to approving the activity, contrary to s 111 of the EPA Act; 3. The Minister breached s 112 of the EPA Act because she approved the activity without first being furnished with an EIS as required by s 112(1).
2. While the grounds of review relate solely to the EPA Act it became clear in the course of the hearing that parts of the Mining Act concerning access to land arrangements may need to be considered. SHCAG submitted that the actual routes of the access tracks to the proposed boreholes had to be identified and their environmental impact assessed by the relevant Minister in order to comply with Pt 5 of the EPA Act and they were not. In the absence of agreement to allow access by landowners of the land on which Hume Coal wishes to drill (which they are under no legal obligation to provide at present), Hume Coal has not to date been able to precisely identify by ground truthing the most appropriate access routes to the proposed boreholes.
3. In opening oral submissions SHCAG submitted that it was necessary for Hume Coal to first seek access to private land under the access arrangements in Pt 8 Div 2 of the Mining Act in order to enter and determine where the access tracks should go before proceeding with the Review of Environmental Factors (REF) process designed to meet obligations for environmental assessment under the EPA Act. There are presently processes under Pt 8 Div 2 of the Mining Act in relation to land access by Hume Coal taking place, including arbitration, with landowners who gave evidence in these proceedings. These have not resulted in any final access arrangements on any of the relevant private land to date.
4. Alternatively, and primarily, in closing submissions SHCAG submitted that Hume Coal should have applied to the relevant Minister for a permit under s 252 of the Mining Act which would enable it to enter private property to do the necessary assessment of access tracks before proceeding with the REF process under the EPA Act. The interaction if any between the two statutory regimes in the manner contended for by SHCAG has not been identified in any case I am aware of. Both Respondents rejected these submissions and I infer the approach to arranging access to private land contended for by SHCAG has never been required by the Minister or the relevant department in any environmental assessment process for an exploration licence under the EPA Act to date.

Environmental Planning and Assessment Act 1979

1. Relevant sections of the EPA Act provide: 5 Objects The objects of this Act are: (a) to encourage: (i) the proper management, development and conservation of natural and artificial resources, including agricultural land, natural areas, forests, minerals, water, cities, towns and villages for the purpose of promoting the social and economic welfare of the community and a better environment, (ii) the promotion and co-ordination of the orderly and economic use and development of land, (iii) the protection, provision and co-ordination of communication and utility services, (iv) the provision of land for public purposes, (v) the provision and co-ordination of community services and facilities, and (vi) the protection of the environment, including the protection and conservation of native animals and plants, including threatened species, populations and ecological communities, and their habitats, and (vii) ecologically sustainable development, and (viii) the provision and maintenance of affordable housing, and (b) to promote the sharing of the responsibility for environmental planning between the different levels of government in the State, and (c) to provide increased opportunity for public involvement and participation in environmental planning and assessment. Part 5 Environmental assessment Division 1 Preliminary 110 Definitions (1) In this Part: activity means: (a) the use of land, and (b) the subdivision of land, and (c) the erection of a building, and (d) the carrying out of a work, and (e) the demolition of a building or work, and … approval includes: (a) a consent, licence or permission or any form of authorisation, and (b) a provision of financial accommodation by a determining authority to another person, not being a provision of such financial accommodation, or financial accommodation of such class or description, as may be prescribed for the purposes of this definition by a determining authority so prescribed. … Division 2 Duty of determining authorities to consider environmental impact of activities 111 Duty to consider environmental impact (1) For the purpose of attaining the objects of this Act relating to the protection and enhancement of the environment, a determining authority in its consideration of an activity shall, notwithstanding any other provisions of this Act or the provisions of any other Act or of any instrument made under this or any other Act, examine and take into account to the fullest extent possible all matters affecting or likely to affect the environment by reason of that activity … Division 3 Activities for which EIS required 112 Decision of determining authority in relation to certain activities (1) A determining authority shall not carry out an activity, or grant an approval in relation to an activity, being an activity that is a prescribed activity, an activity of a prescribed kind or an activity that is likely to significantly affect the environment (including critical habitat) or threatened species, populations or ecological communities, or their habitats, unless: (a) the determining authority has obtained or been furnished with and has examined and considered an environmental impact statement in respect of the activity: (i) prepared in the prescribed form and manner by or on behalf of the proponent, and (ii) except where the proponent is the determining authority, submitted to the determining authority in the prescribed manner, …

Mining Act 1992

1. Relevant sections of the Mining Act provide: Part 3 Exploration licences Division 4 Rights and duties under an exploration licence 29 Rights under exploration licence (1) The holder of an exploration licence may, in accordance with the conditions of the licence, prospect on the land specified in the licence for the group or groups of minerals so specified. … 31 Dwelling-houses, gardens and significant improvements (1) The holder of an exploration licence may not exercise any of the rights conferred by the licence over the surface of land: (a) on which, or within the prescribed distance of which, is situated a dwelling-house that is the principal place of residence of the person occupying it, or (b) on which, or within the prescribed distance of which, is situated any garden, or (c) on which is situated any significant improvement other than an improvement constructed or used for mining purposes only, except with the written consent of the owner of the dwelling-house, garden or improvement (and, in the case of the dwelling-house, the written consent of its occupant). (2) The prescribed distance is: (a) 200 metres (or, if a greater distance is prescribed by the regulations, the greater distance) for the purposes of subsection (1) (a), and (b) 50 metres (or, if a greater distance is prescribed by the regulations, the greater distance) for the purposes of subsection (1) (b). (3) A written consent given under this section is irrevocable. (4) This section does not apply with respect to a dwelling-house, garden or significant improvement owned by the holder of the exploration licence or, if the holder is a corporation, by a related corporation. (5) If a dispute arises as to whether or not subsection (1) applies in a particular case, any party to the dispute may apply to the Land and Environment Court for a determination of the matter. … Part 8 Authorities generally Division 2 Access arrangements for prospecting titles 138 Application of Division (1) This Division applies to the carrying out of prospecting operations under exploration licences and assessment leases (referred to in this Division as prospecting titles) on any land…. 140 Prospecting to be carried out in accordance with access arrangement (1) The holder of a prospecting title must not carry out prospecting operations on any particular area of land except in accordance with an access arrangement or arrangements applying to that area of land: (a) agreed (in writing) between the holder of the prospecting title and each landholder of that area of land, or (b) determined by an arbitrator in accordance with this Division. … 141 Matters for which access arrangement to provide (1) An access arrangement may make provision for or with respect to the following matters: (a) the periods during which the holder of the prospecting title is to be permitted access to the land, (b) the parts of the land in or on which the holder of the prospecting title may prospect and the means by which the holder may gain access to those parts of the land, (c) the kinds of prospecting operations that may be carried out in or on the land, (d) the conditions to be observed by the holder of the prospecting title when prospecting in or on the land, (e) (Repealed) (f) the compensation to be paid to any landholder of the land as a consequence of the holder of the prospecting title carrying out prospecting operations in or on the land, (g) the manner of resolving any dispute arising in connection with the arrangement, (h) the manner of varying the arrangement, (i) the notification to the holder of the prospecting title of particulars of any person who becomes an additional landholder. … 142 Holder of prospecting title to seek access arrangement (1) The holder of a prospecting title may, by written notice served on each landholder of the land concerned, give notice of the holder's intention to obtain an access arrangement in respect of the land. … (3) The holder of a prospecting title and a landholder of the land concerned may agree in writing (either before or after the prospecting title is granted) on an access arrangement. … 143 Appointment of arbitrator by agreement (1) If, by the end of 28 days after the holder of a prospecting title serves notice in writing on each landholder of the holder's intention to obtain an access arrangement, the holder and each landholder have been unable to agree on such an arrangement, the holder may, by further notice in writing served on each landholder, request them to agree to the appointment of an arbitrator. (2) The holder of a prospecting title and each landholder of the land concerned may agree to the appointment of any person as an arbitrator. 152 Costs (1) Each party to the hearing is to bear his or her own costs in relation to the hearing. (2) The arbitrator's costs in relation to the hearing are to be borne by the holder of the prospecting title. (3) Payment of the arbitrator's costs in relation to a hearing is, for the purpose of any security given by the holder of a prospecting title, taken to be an obligation under the title. 155 Review of determination (1) A party to a hearing who is aggrieved by an arbitrator's final determination (other than a determination referred to in section 147 (2)) may apply to the Land and Environment Court for a review of the determination. … (7) The decision of the Land and Environment Court on a review of a determination is final and is to be given effect to as if it were the determination of an arbitrator. … Part 12 Powers of entry and inspection Division 2 Entry in other circumstances 252 Environmental assessment (1) The Minister may, on the application of a person who proposes to undertake an assessment (for the purposes of this Act or the Environmental Planning and Assessment Act 1979) of the likely effect on the environment of the activities to be carried out under an authority or a mineral claim, grant a permit to the applicant to enter any land so as to enable the person to undertake the assessment. (2) (Repealed) (3) The holder of a permit under this section, and any employee or agent of the holder, may, in accordance with the permit: (a) enter the land to which the permit relates, and (b) do on that land all such things as are reasonably necessary to carry out the assessment to which the permit relates. …
2. The Dictionary to the Mining Act states: significant improvement means any substantial building, dam, reservoir, contour bank, graded bank, levee, water disposal area, soil conservation work or other valuable work or structure.
3. The parties agree and I directed pursuant to s 136 of the Evidence Act 1995 (NSW) that this Court is not determining whether any structure is a significant improvement for the purposes of the Mining Act. References in the affidavit evidence to the term are to be read as "claimed significant improvements" (TS 163/36-164/15).

Evidence

1. A court book containing, inter alia, the Activity Approval for phase 3 exploration activities signed by the Assistant Director Environmental Operations on 3 September 2014 (Activity Approval), the Assessment Report for phase 3 exploration activity dated 29 August 2014 (Assessment Report) and SHCAG and the Respondents' respective chronologies, was tendered. An evidence book comprising seven volumes was also tendered.
2. SHCAG's primary evidence was made up of evidence book volumes 1, 2, 6 and volume 7 (but not including tab 97, 98 and 99) (exhibit B). In addition to different versions of the Assessment Report and the REF 3, exhibit B included the Department of Urban Affairs and Planning document entitled "Is an EIS required?" dated November 1996, email correspondence between SHCAG's solicitor dated 7 March 2014 and associated email chain. Also included was the Department's document entitled "Review of Community Submissions". Exhibit B also contained the landholders' affidavits, and the expert report of Dr Davies dated 29 August 2014 and his expert report in reply dated 16 March 2015.
3. Hume Coal's primary evidence was made up of evidence book volumes 3 (exhibit 2), 4 and 5 (exhibit 1, also tendered by the Minister as exhibit 1A) and tabs 97, 98 and 99 of volume 7 (exhibit 3). Exhibit 2 contained, inter alia, Authorisation 349 dated 12 March 2013, which contained the relevant conditions at the time REF 3 was approved. Exhibit 3 was made up of the expert reports of Mr Doyle dated 9 March 2015, Mr Gardyne dated 8 March 2015 and Mr Richardson dated 9 March 2015 (tab 97, 98 and 99, EB vol 7).

Material before the Minister's delegate

1. Exhibit 1/1A contained material that was before the Minister's delegate at the time approval was granted, including the Assessment Report annexing, inter alia, the REF 3 and the Pt 5 determination under the EPA Act by Senior Inspector Environment of the Department with inspection date 1 August 2014 and evaluation date 29 August 2014 stating that the activity is not likely to significantly affect the environment and that no EIS is required. Also annexed to the Assessment Report was the Department's summary of SHCAG's submissions in a document entitled "Review of Community Submissions" and the Department site inspection report dated 25 August 2015. The site inspection report included photographs of a number of properties the subject of the REF 3 taken from public land.
2. Also before the Minister's delegate was material concerning community submissions. Email correspondence between Hume Coal and the Department over the period 4-29 August 2014 concerned Departmental requests for additional information regarding stakeholder/community consultation, and amendments and subsequent resubmission of the REF 3 submitted 15 July 2014. Hume Coal's documents entitled "Annual Community Consultation Report" for the year ending 23 November 2013 and "Interim Community Consultation Report" for the period from 23 November 2013 to 5 August 2014 also formed part of exhibit 1.
3. A letter from Mr Martin, convenor of SHCAG, to Mr Barry, the Director Environment Sustainability at the Department dated 24 April 2014 attached, inter alia, a document entitled "landholder property assessment", a critique of Hume Coal's revised REF 3 and a document entitled "Part 5 EP&A Assessment critique of Hume's Appendix C". The landholder property assessment identified the agricultural activity on the affected properties, claimed significant improvements existed and access issues for each landowner affected. An extract of the table Attachment 1 Landholder property assessment (p 2214, EB, vol 5) follows: Landholder Size of property Agricultural activity - access issues Map - % property upon which drilling could take place Fesen Pty Ltd (Pollicina) 350 acres Beef and lucerne crop Yes Lucerne crop (significant improvement [s 31 Mining Act]) in paddock on Hume Hwy. No other access. 66% of property affected Roche 160 acres Eventing course for training and competition horse events. Access track wheel ruts will be a serious safety hazard for horses undertaking eventing courses on the property as in a gallop. Lucerne crop across paddock on Hume Hwy. Yes 70% of property affected Martin 105 acres Truffles and lucerne crop across access paddocks, significantly improved driveway, gardens lining driveway. Yes Alexander 350 acres Veal and oats crop. Significantly improved driveway, gardens lining driveway, 200m prescribed distance around house result in no access available to Hume. Yes 80% of property affected Pollicia 160 acres Beef and lucerne crops. Significantly improved driveway, gardens lining driveway, 200m prescribed distance around house result in no access available to Hume. Yes 66% of property affected

1. An email from the Department to Hume Coal dated 8 August 2014 (p 2290, EB vol 5) attached a letter from Mr Martin of SHCAG to the Minister dated 1 August 2014 outlining "key issues" of SHCAG's concerns (this letter also produced at tab 32, EB vol 1 formed part of exhibit A, tendered by SHCAG). These concerns related to, inter alia, uncertainty regarding borehole locations, the resulting inability to assess cumulative impacts, the significant costs incurred by landowners in respect of access arrangements and the failure of the REF 3 to address cumulative socio-economic impacts. SHCAG also identified as a "key issue" Hume Coal's misrepresentation of the level of community consultation it had undertaken, noting that Hume Coal's statement that "scheduled update meetings are being held" was false. SHCAG and affected landowners were not invited and had no knowledge about a workshop Hume Coal claimed to have held with local landowners and farmers about the negligible impacts of its proposed mining project. An email from Hume Coal to the Department dated 22 August 2014 attached Hume Coal's response to a number of the key issues and indicated that this SHCAG submission had been addressed in the Interim Community Consultation Report.
2. The letter sent by Mr Martin to Dr Blackmore, Director Environment Sustainability, dated 1 August 2014 was not included in the material before the Minister's delegate (tab 33, EB vol 1). This letter formed part of exhibit A, tendered by SHCAG. It included material similar but not identical to Mr Martin's letter to Mr Barry dated 24 April 2014, referred to above at par 23. Attachment 1 is a landholder property assessment report which provides more detail in relation to the Roche property of "Garden up drive way to principal place of residence. The Roches do not agree to noise levels exceeding that set out in Clause 15 AUTH349 2013". Similar additional references to noise levels are also stated for Pollicina, Fesen Pty Ltd and Alexander. Attachment 2 is a critique of the revised REF 3 and contains additional comments about the landowners' properties.

Authorisation 349

1. The instrument of renewal of Authorisation 349 contains the following relevant conditions: EXPLORATION LICENCE CONDITIONS (COAL) 2012 DEFINITIONS … Category 1 prospecting operations means development to which clause 10(2) of the Mining SEPP applies. Category 2 prospecting operations means: Development of a kind described in clause 10(2) of the Mining SEPP but that is not exempt development because it will not take place on land that is described in clause 10(1); Construction of an access way such as a track or road; Excavations (including bulk samples) totalling less than 100 cubic metres; Non-intensive drilling of boreholes; Construction of water monitoring bores required in connection with prospecting operations; and Seismic surveys. Category 3 prospecting operations means: Development, not being development to which clause 10(2) of the Mining SEPP applies, which is: Excavation totalling more than 100 cubic metres, including bulk samples, but not if the bulk sample is permissible only with consent under the EP&A Act; Intensive drilling of boreholes; Shaft sinking or tunnelling; and Any other prospecting operations not being Category 1 prospecting operations or Category 2 prospecting operations. … CONDITIONS Prospecting operations permitted under this exploration licence The licence holder may conduct Category 1 prospecting operations on the exploration licence area subject to the conditions of this licence. … Prospecting operations requiring further approval The licence holder must obtain the Minister's written approval prior to carrying out any of the following prospecting operations on the exploration licence area: Category 2 prospecting operations; and Category 3 prospecting operations. The licence holder must comply with the conditions of an approval under condition 2 when carrying out those prospecting operations. … Environmental harm The licence holder must implement all reasonably practical measures to prevent and/or minimise harm to the environment that may result from the conduct of any prospecting operations under this exploration licence. … Vegetation Clearing Vegetation clearing and vegetation disturbance must be limited to the minimum extent necessary to facilitate the conduct of prospecting operations authorised by this exploration licence. … Roads and Tracks Except where otherwise approved under condition 2, the licence holder must ensure that: Existing roads and tracks are used in preference to constructing new roads and tracks; The planning, design, construction and maintenance of unsealed roads and tracks is constructed generally in accordance with Managing Urban Stormwater: Soils and Construction, Volumn 2C, Unsealed Roads (DECC 2007) as amended or replaced from time to time; … The licence holder must restrict the use of any unsealed road or track during wet weather to prevent damage to that road or track unless the road or track has been designed and constructed for use in wet weather. … Rehabilitation All disturbance resulting from prospecting operations carried out under this exploration licence must be rehabilitated by the licence holder to the satisfaction of the Minister. In rehabilitating the disturbance resulting from prospecting operations, the licence holder must ensure that: all machinery, buildings and other infrastructure is removed from the area; the area is left in a clean, tidy and stable condition there is no adverse environmental effect outside the disturbed area; the land is properly drained and protected from soil erosion; the land is not a potential source of pollution; the land is compatible with the surrounding land and land use requirements; the landforms, soils, hydrology and flora require no greater maintenance than that in, or on, the surrounding land; the land does not pose a threat to public safety; and in cases where vegetation has been removed or damaged: where the previous vegetation was native, species used for revegetation are endemic to the area; or where the previous vegetation was not native, species used for revegetation are appropriate to the area; and any revegetation is of an appropriate density and diversity. The licence holder must ensure that all water land and wetland crossings that are disturbed during prospecting operations are rehabilitated such that the natural flow of water is unimpeded and bank stability is maintained to prevent erosion. The licence holder must comply with any relevant guidelines issued by the Director-General in the rehabilitation of disturbance resulting from prospecting operations under this exploration licence. …
2. The Minister granted Hume Coal approval for phase 3 exploration activities on 3 September 2014. The Activity Approval relevantly states: ACTIVITY APPROVAL FOR PHASE 3 EXPLORATION ACTIVITIES (AUTHORISATION 349, ACT 1973) Pursuant to Conditions 2 and 3 of Authorisation 349, granted under the provisions of the Mining Act 1992, the titleholder is approved to conduct the Home Coal Phase 3 exploration activities comprising 25 drill holes, subject to the conditions set out below. These conditions relate specifically to this approval and are in addition to those attached to Authorisation 349. A breach of these conditions is an offence under the Mining Act 1992. CONDITIONS General 1. The activity must be carried out in accordance with the: "Hume Coal Project, Hume Coal Phase 3 Exploration Activity - Review of Environmental Factors, August 2014" (including all appendices), dated 29 August 2014; and Conditions of this approval. If there is any inconsistency between the above documents, the most recent document prevails to the extent of the inconsistency. Approval Term 2. The approval ceases to have effect 2 years from the date of this letter. ...

Assessment report

1. The Assessment Report dated 29 August 2014 contained the following relevant sections: 1. PROPOSED ACTIVITY Hume Coal Pty Limited (Hume Coal) proposes to conduct a coal exploration program consisting of twenty five (25) drill holes within Authorisation 349, near Sutton Forest NSW. This program represents the third exploration program undertaken by Hume Coal within Authorisation 349 and is known as the Phase 3 Exploration Program. The exploration program is designed to further evaluate the coal resource in the area and to delineate geological structures which may be an impediment to any future mining proposal. 2. BACKGROUND - DETERMINATION OF INITIAL APPLICATION FOR PHASE 3 EXPLORATION ACTIVITIES Hume Coal submitted a previous application for Phase 3 Exploration Activities, which was received by the Division of Resources and Energy (DRE) on 12 March 2014. That application was for a total of 90 holes within Authorisation 349. Following assessment by DRE, the Director Environmental Sustainability determined on 12 May 2014 that the proposed activity was "likely to have a significant cumulative impact on the environment" and requested preparation and submission of an EIS if Hume Coal decided to proceed with the application. Hume Coal subsequently decided to withdraw their application and to submit a new Phase 3 Exploration Activity Application for a reduced area (25 holes instead of 90). This is the application which is the subject of this review. Section 4.11 of this assessment report includes further detail regarding assessment of cumulative impacts. 3. REGULATORY CONTEXT Hume Coal is the holder of Authorisation 349. Authorisation 349 was renewed on 12 March 2013 and includes the most recent Exploration Licence Conditions (Coal) 2012. The term of renewal of Authorisation 349 is until 23 November 2014. Hume Coal has identified the proposed Phase 3 exploration activity as Category 3 prospecting operations in accordance with Condition 2 of Authorisation 349. Condition 2 requires the licence holder to: obtain Minister's written approval prior to conducting Category 2 or 3 prospecting operations; and submit a Surface Disturbance Notice, Review of Environmental Factors and an Agricultural Impact Statement for Category 3 prospecting operations. A Part 5 determination is required in this case because the activity is not subject to Parts 3A or 4 of the Environmental Planning and Assessment Act 1979 and the State Environmental Planning Policy (Mining, Petroleum and Extractive Industries) 2007 does not define the activity as "exempt development". In accordance with section 111 of the Environmental Planning and Assessment Act 1979, the Minister (or his delegate) as the "determining authority" is required to examine and take into account to the fullest extent possible all matters affecting or likely to affect the environment by reason of that activity. Where there is likely to be a significant effect on the environment, an Environmental Impact Statement (EIS) is required prior to the activity being determined. Following completion of the Part 5 assessment, and if the activity is considered to [sic] not likely have a significant impact on the environment, the proposed activity can be approved by the Minister in accordance with Condition 2 of Authorisation 349 granted under the Mining Act 1973. The "Mining Act 1992 & Environmental Planning and Assessment Act 1979, Instrument of Delegation (Minister)", dated 30 November 2010, identifies that "Any condition of an authority....that confers or imposes a function on the Minister" is delegated to Delegate Categories E, J, K, L and M. Delegate Category J includes the Manager, Environmental Operations (equivalent position is now the Assistant Director Environmental Operations) and the Team Leader, Environment - Wollongong (equivalent position is now the Manager & Principal Inspector Environment - Wollongong). In accordance with the current Ministerial Delegation and ESU internal policy, the Assistant Director Environmental Operations is the delegated determining officer for this application. 4. ASSESSMENT SUMMARY … 4.2 Activity Description The proposed activity involves the drilling of up to 25 coal exploration boreholes from the surface to below the basal seam of the lllawarra Coal Measures. The primary target is the Wongawilii Seam which will be cored at each borehole. Some boreholes will be drilled from the surface to the base of the lllawarra Coal Measures, below the Woonona Seam. All boreholes will be subject to geotechnical evaluation and selected holes will remain as ongoing water monitoring bores by the installation of a piezometer. The proposed activity is designed to target information gaps from the previous two drilling phases which will enable Hume Coal to sufficiently advance its conceptual mine planning. The REF provides an overall assessment of the activity. The key aspects of the activity include the following: Drilling of up to 25 boreholes from the surface to below the Wongawilii Seam in order to target information gaps from the previous two drilling phases; Drilling will primarily involve small diameter holes (100 mm) with larger diameter holes (200 mm) to be drilled at selected sites to obtain a larger sample of coal; Drill pads will be 25 metres by 25 metres in size; Each drill site will take up to 4 weeks to complete; Drilling activity will occur within standard daylight hours (ie. 7am to 6pm on weekdays and 8 am and 1 pm on Saturdays, with landowner permission); The activity will include improvements to existing access tracks and construction of minor additional tracks; The activity will occur on six (6) private properties and one (1) property owned by Hume Coal; and The activity is proposed to occur over a 2 year time period. 4.3 Land Impacts Each of the drill pads will require a maximum area of 25 metres by 25 metres. Existing access tracks will be used wherever possible and will be upgraded as required in negotiation with the landowner. The location of any new access tracks will be negotiated with the land owner and will be limited to paddocks and previously disturbed areas where no tree removal is required. The precise total disturbance area of the activity is not specified but will likely be 1.56 hectares of drill pads (ie. 25 x 625 m2) plus additional access track installations. However, this total area will not be disturbed at the same time. The activity is understood to occur in a sequential fashion with progressive rehabilitation of disturbed areas prior to the commencement of a new drill site. Creek crossings will be avoided where these could have undue impacts. Topsoil disturbance will be kept to a minimum. Topsoil stripping will only occur around the immediate drill hole collar only [sic] (approximately 2m2 per drill hole). Standard mitigation measures are proposed including limiting areas of disturbance, using conventional erosion and sedimentation techniques and completing rehabilitation of each drill pad as soon as practical at the completion of drilling. No significant impacts to the land are expected as part of this activity provided disturbed areas are progressively rehabilitated in the manner outlined in the REF as described. … 4.5 Rehabilitation Hume Coal has committed to undertaking rehabilitation in accordance with each landowner's requirements. The REF also provides a general scope of the proposed rehabilitation activities at each site which can be broadly summarised as follows: Rehabilitation activities will generally commence at the completion of drilling which is expected to take no longer than 4 weeks at each site; Temporary access tracks and associated disturbed areas not required by the landowner will be ripped, seeded and fertilised following completion of drilling; Following completion of track construction, the area will be re-instated to its original condition in consultation with the landowner; Seed and fertiliser will be applied to all ground in the vicinity of the access track where surface grasses have been removed or bare patches are evident; The drill site will be cleaned as necessary, harrowed to reduce compaction and sown. The proposed rehabilitation methods outlined in the REF are considered satisfactory. The Department has conducted inspections of previous drilling locations completed by Hume Coal and the rehabilitation standard has been considered leading practice. … 4.10 Social and Economic Impacts The REF includes an assessment of the potential community impacts associated with the proposed exploration activity. A social and economic profile is provided for the Southern Highlands townships of Sutton Forest and Exeter; considered as the most likely communities to be impacted by the activity. The following impacts and mitigation measures have been identified in the REF: negligible impact on roads, power, water, drainage, waste management, education, medical and social services; economic impact of the exploration activity (based on a 90 hole program) on agricultural viability would equate to less than $20,000 for the entire program or between $130 to $280 per / drill hole; direct impacts on affected landholders will include loss of amenity, noise and dust emissions, inconvenience and the temporary loss of use of the land during drilling; indirect impacts on landholders have been identified as effects on the availability of community services, property valuation and tourism; and perceived impacts including perceptions and concerns related to any future mining proposal and the misperception that Hume Coal is permitted to explore for coal seam gas have been identified. The REF makes a substantial attempt to identify and minimise the likely socio-economic impacts associated with this activity. This assessment included the results of a Hume Coal initiated workshop with consultants, landholders and local farmers to identify specific concerns related to the proposed activity. The REF makes it clear that some of the identified socio-economic impacts can be minimised using practical measures (for eg. dust and noise control), but other psychological considerations such as conducting exploration against the wishes of those opposed to mining activities are difficult to quantify and resolve. 4.11 Cumulative Impacts Cumulative impacts are discussed in Section 12 of the REF. This revised application seeks to reduce the previously proposed cumulative impact level by moderating the scale of the activity. Specifically, the proposed changes include: Reduce the number of exploration holes from 90 to 25; Reduce the period of the program from 5 years to 2 years; Reduce the number of properties affected from 16 to 6 (plus 1 owned by Hume Coal); Limit the program to using 1 drill rig instead of up to 3 drill rigs; Eliminate the option of utilising alternative hole locations to avoid unnecessary social impact; Limit the number of holes on small acreage properties; and Commit to not drilling holes sequentially on individual properties unless otherwise agreed with the landowner. This exploration program is the only known exploration program in the area and no other notable drilling programs (possibly apart from isolated water bore installations) are known to occur. Hume Coal has undertaken two previous exploration programs (Phase 1 and Phase 2) within Authorisation 349. However, exploration sites associated with Phase 1 and 2 have been progressively rehabilitated and the addition of the Phase 3 exploration is not likely to lead to a significant cumulative impact on the biophysical environment. The cumulative socio-economic impacts associated with the original Phase 3 application which involved drilling 90 holes out of a nominated 150 borehole locations drilled over a 5 year period was identified as a concern. The revised activity application now consists of 25 boreholes over a two year period. This is considered to be a satisfactory reduction in the scale and intensity of the activity such as to reduce potential cumulative impacts to a manageable level. A further reduction in the number of properties affected from 16 to 6 (plus 1 owned by Hume Coal) will serve to substantially reduce socio-economic impacts. The revised activity application includes the use of a single drill rig rather than three proposed in the previous Phase 3 application. The use of one drill rig only will help to reduce the cumulative impacts of the program on traffic, noise, dust and water due to the reduced number and intensity of drilling. The low intensity drilling and reduced number of landowners affected gives DRE more confidence that the cumulative impacts are acceptable for the community and environment. 4.12 Community Consultation and Access Arrangements Hume Coal operates a community consultation strategy with the intent of providing information to the community regarding the company's operations. The consultation strategy employs several consultation tools as follows: Notification letters to landholders within 500 metres of a drill site, 14 days prior to works commencing Quarterly newsletters Media releases around community events Community presentations and information days Community surveys, fact sheets, websites and private meetings Open door' local office in Moss Vale Hume Coal is aware of Sections 138 - 158 of the Mining Act 1992 as it relates to land access agreements and arbitration. Hume Coal has previous experience in obtaining land access agreements by both negotiation and arbitration. It is expected that a significant number of private landholders will be affected by this activity and Hume Coal will need to resolve land access issues in accordance with the relevant provisions of the Mining Act 1992 when undertaking land access negotiations and arbitration. The REF also notes the operation of Section 31 of the Mining Act 1992 which precludes activities occurring within 200 metres of a principle place of residence or within 50 metres of a garden or significant improvement. This requirement is well documented throughout the REF. … 5 CONSULTATION 5.1 Review by the Office of Agricultural Sustainability & Food Security The "Hume Coal Exploration Project - Agricultural Impact Statement" was reviewed by the Office of Agricultural Sustainability & Food Security (OASFS) and a response letter was provided to DRE dated 29 July 2014. The OASFS has assessed the activity as a LOW risk to agriculture due to the following: there is a definitive and strategic process to identify the drill hole sites; the scale of exploration is limited to 25 holes in this instance to be done over about 2 years; the level of commitment to the preparation, drilling set up and activity and decommissioning of the drill sites shows a genuine commitment to best practice in ensuring land is returned to full agricultural integrity within 12 months; and no Biophysical Strategic Agricultural Land (BSAL) is identified in this area at a regional level. OASFS recommends that future applications should consider a property level assessment for the presence of BSAL rather than reliance on broad-scale published maps. … 5.2 Submissions from the Community A total of four (4) submissions were received by DRE in relation to this exploration activity application (Appendix J). Three (3) were in support of the application and one (1) identified concerns and/or was unsupportive of the application. Issues raised in the unsupportive submission were subjected to further detailed analysis which is provided as Appendix I. … 6 ASSESSMENT OF IMPACTS An assessment of the significance of environmental impacts associated with the proposed activity was undertaken in accordance with the Department of Planning and Infrastructure guideline "Is an EIS required? Best practice guidelines for Part 5 of the Environmental Planning and Assessment Act 1979". The results of this assessment are documented in the attached Part 5 Assessment Tables (Appendix G). Based on the information provided in the REF and the assessment undertaken in the Part 5 Assessment Tables, the proposed drilling of up to 25 coal exploration boreholes has been determined as not likely to have a significant impact on the environment. 7. Appendices A Application form ESB-F01 - prepared by Hume Coal Pty Limited and dated 15 July 2014 (INW14/30036) B Covering Letter from Hume Coal Pty Limited dated 15 July 2014 (INW14/30033) C REF (including AIS) entitled "Hume Coal Project, Hume Coal Phase 3 Exploration Activity - Review of Environmental Factors, 29 August 2014" - prepared by International Environmental Consultants Pty Limited (INW14/36748) (Note - the August 2014 version of the REF replaces the initial July 2014 submission (INW14/30035), changes were requested by DRE to correct two minor inaccuracies identified in the July 2014 version) D Surface Disturbance Notice dated 15 July 2014 - prepared by Hume Coal Pty Limited (INW14/30034) E Approval Letter - prepared by Senior Inspector Environment (OUT14/25514) F Activity approval procedure cover sheet - prepared by Senior Inspector Environment (INT14/69181) G Part 5 Assessment Tables - prepared by Senior Inspector Environment (INT14/76601) H Review of the AIS prepared by the Office of Agricultural Sustainability and Food Security and dated 29 July 2014 (OUT14/20813) I Review of Community Submissions - prepared by Senior Inspector Environment (INT14/79978) J Community submissions (MCV14/927#1) K Site Inspection Report from 1 August 2014 (INT14/80867)

…

1. The Review of Community Submissions (Appendix I to the Assessment Report) identified issues raised by SHCAG and comments made by the Department, in part as follows: Issues Raised DRE Comment Confusion regarding the extent of the program. Is the approval for 25 or 70 holes? The AIS prepared by Hume Coal has been prepared to account for the possibility of obtaining approval of a further 70 exploration holes within Authorisation 349. However, the exploration activity application and the supporting REF is only seeking approval for 25 holes. The 25 hole locations have been clearly identified in the REF. If approved, only 25 holes will be permitted to be drilled. Previously drilled monitoring bores and coal exploration holes are ignored in the cumulative impact assessment. Coal exploration holes previously drilled by Hume Coal have been referenced on the plan entitled "REF 3 Planned Locations". DRE understands that Hume Coal promptly rehabilitates completed exploration holes where no further water monitoring installations are required. DRE does not consider that water monitoring devices installed following exploration activities are a significant cumulative impact consideration provided that they are installed and protected in accordance with NOW licencing requirements. Authorisation 349 only permits "resource definition" not detailed mine planning. DRE considers that Hume Coal is conducting exploration within the intent of Authorisation 349. Landowners forced into costly arbitration process to gain land access. Relates to the operation of Section 31 of the Mining Act 1992. Outside the scope of this review. Cumulative socio-economic impacts have not been addressed. Previously identified concerns regarding cumulative socio-economic impacts have been alleviated by a reduction in impact level and further description of the socio-economic environment of the Southern Highlands. Issues related to land access and arbitration have not been addressed. Relates to the operation of Section 31 of the Mining Act 1992. Outside the scope of this review. The level of community consultation has been misrepresented. Submission is concerned regarding the wording on page 2-18 of REF stating "Scheduled update meetings with Southern Highlands Coal Action Group and the local State Parliament member". Hume Coal has clarified the wording on this page in a letter dated 22 August 2014. Consultation has been occurring with SHCAG members and members of parliament. Workshop with local landowners and farmers did not include SHCAG and affected landowners. In a letter dated 22 August 2014, Hume Coal explained that the workshop was designed to understand socio-economic impacts from other exploration programs in the locality. Landholders who had experienced previous exploration on their properties attended this workshop.

REF 3

1. The REF 3 provides the following general description of the proposed activity (p 1767, EB Vol 4): 2.3 Description of Activity 2.3.1 General Hume Coal proposes to continue exploration drilling in A 349 with the approval or this Phase 3 REF. Drilling is expected to continue for a two year period, depending on the timing of landholder access agreements being secured and the availability of the drill rig. A total of 25 drill sites will be developed across the Authorisation. Most boreholes will be drilled to the floor of the Wongawilli Seam, but some may extend further to the base of the underlying Illawarra Coal Measures, below the Woonona Seam. The data obtained from the proposed drilling program will be used to update the current geological model with more detailed information relating [sic] the location of geological structures and anomalies, as well as coal seam roof and floor conditions. Existing data from the adjoining Berrima Colliery will also be used to correlate known faults and dykes which may extend into A 349. This model, together with geotechnical assessment of the strata immediately above the target seam, will be used to further develop and refine mining and planning studies. Additional piezometers will be installed in a number of the bores to monitor groundwater levels and quality, to build on the existing groundwater monitoring network which is designed to assess the potential impacts from mining on the groundwater system.
2. Table 2.1 appears under the heading "Description of the Activity" (p 1768-69, EB vol 4). It identifies, among other things, the co-ordinates for the 25 potential drill site locations, a description of the property on which the borehole is to be located and an identification of the extent of the drilling impact. The proposed locations of the 25 boreholes are depicted graphically in Figure 2A (nominated drill site location) and Figure 2B (proposed drill sites and completed drill sites) (p 1764-65, EB vol 4).
3. The executive summary states that to date a total of 136 holes have been completed within the area of Authorisation 349 by Hume Coal, including rehabilitation and return to previous land use (p 1754, EB vol 4). Addressing the Department's concerns with the initial version of the REF 3 submitted on 7 March 2014 for 90 boreholes, the executive summary to the REF 3 states (p 1754-55, EB Vol 4): … Hume Coal has addressed these concerns by reducing the intensity of drilling. Following a review of the proposed final exploration phase Hume Coal has confirmed 70 holes would be required with a minimum of 25 holes drilled in the first instance. This drilling should allow Hume Coal to sufficiently advance its conceptual mine planning in order to support a development application to NSW Planning and Environment. This REF now covers only the drilling of the first 25 boreholes. Following the results of these holes, a separate approval would be sought for any remaining holes needed to complete geological and coal quality evaluations required for a mining lease.
4. It is common ground that the REF did not identify the actual locations of the proposed access tracks to the proposed drilling sites. The REF 3 relevantly states (p 1770-1, 1776, 1788-89, EB vol 4): 2.3.3 Site Selection Principles The primary mitigation strategy relating to the activity is avoidance of impacts. Sites will be selected where: Proximity to residences is greater than 200 m unless land owner agreement is obtained; … The drill site will be located near existing roads and tracks where practical; … In addition to the above criteria, sites will be selected in consultation with the landholder as outlined in the Land Access Agreement. … 2.3.4 Site Preparation Access Access to drill sites will be via public roads and internal property roads and tracks. Landholders will be consulted regarding to [sic] access to drill sites and any access upgrades that may be required. Wherever practical, existing roads and tracks will be used. Access routes will be upgraded if they are unsafe, or to prevent erosion during wet weather. To minimise access distance or impacts, new gates may be installed in fences where necessary which may be removed on completion of drilling activities or left in place for ongoing access for groundwater monitoring or at the landholder's request. In some locations, where it is deemed suitable, vehicles will drive across grassed areas. The nominated drill sites have been located to avoid the need for new creek crossings or any significant new track construction by utilising existing farm access roads… Drill Site Some surface disturbance may be required to establish drilling sites and for the construction and maintenance of access tracks where access does not already exist… 2.4 Access Track Construction and Maintenance An access track is a track negotiable by vehicles necessary for the drilling program. Where possible existing access tracks will be used with upgrading of these tracks where required. Where new access is required, the location will be determined by the prevailing conditions and property owner preferences. The location of any new tracks will be discussed with each landholder, and will be limited to paddocks and previously disturbed areas where no tree removal would be required. New access tracks will generally be constructed with gravel being laid on the ground's surface, with cut and fill earthworks only where necessary to maintain stability. … 2.9 Access Arrangements Land Access Agreements between landholders and Hume Coal are required to be negotiated prior to accessing any private land for exploration drilling activities. The process of negotiation of an access agreement is provided in the NSW Mining Act 1992 (Mining Act). The process requires Hume Coal to notify a landholder in writing of its intention to obtain an agreement that would allow access. The notification process must include details of the exploration works proposed and an area over which access is sought. The actual site(s) of any drilling must also conform to the requirements of this REF, that is, avoid ecological harm and minimise environmental impact. In addition, under Section 31 of the Mining Act, if any principal place of residence is located within 200 m of any proposed exploration drill site, occupier consent must also be obtained. … Landholders have the right to negotiate the inclusion of property management issues such as preferred access paths within paddocks, avoidance of paddocks with crops or when sensitive breeding activities are occurring, locations of any new tracks to assist in ongoing farm management, access to water and the like. Landholders also have the right to negotiate specific issues such as preferred hours of entry, revegetation works including type of pasture to be used, the type and location of any new gates or fencing that may be needed. … The following access protocols will be maintained for the drilling program: ∙ All traffic is to be confined to access tracks as far as practical; ∙ Where access is via open spaces, particularly in cultivated areas or pasture improved grazing land, care shall be exercised to ensure that minimum damage is caused to the surface by confining movement to the nominated route. Indiscriminate traffic in such areas is to be avoided. Unformed access tracks are shown on the plans provided to all drilling contractors and related personnel and usually follow fence lines; ∙ Access across paddocks, when permitted by the landholder, but not requiring constructed tracks will occur under conditions that will result in minimal damage to soils and vegetation within the paddocks such as avoiding use following heavy rainfall; ∙ The landholder is to be contacted prior to first vehicles entering the property. The landholder is to be advised of subsequent access requirements during the site establishment and drilling phases, as well as for ongoing access to piezometers; ∙ All gates to be left as found (open or closed) unless otherwise indicated by the landholder; and ∙ Transportation of any earthmoving equipment shall occur with the blade up unless involved in drill site preparation or access track construction.
5. Once the land access agreements have been negotiated and the precise location of the drill sites and access tracks confirmed, site specific assessments will occur by qualified ecologists and heritage consultants as required prior to any disturbance (p 1758, EB vol 4). Inspections will include the drill compound area, all access paths including existing and new tracks as well as nearby habitat areas (p 1756, EB vol 4).
6. In relation to borehole locations, the REF 3 states (p 1783, EB Vol 4): … Environmental constraints and risk mapping has been utilised in the selection of the drill sites, each comprising an area with 100 m radius which avoid significant impacts to waterways, agriculture, residential receptors, vegetation, and cultural heritage sites. This, together with detailed site investigations prior to final precise site selection within this area, will ensure that borehole locations will have a negligible impact on the environment while still obtaining the necessary detailed geological information.
7. The site occupation for each hole will be approximately four weeks, although delays may occur due to wet weather or to accommodate specific landholder requests or farm management activities (p 1775, EB Vol 4). The proposed drilling works will result in temporary impacts which will be fully rehabilitated on completion (p 1757, EB vol 4). In its "Summary of Impacts and Conclusion", the REF 3 relevantly provides (p 1878, EB vol 4): The exploration program will cause short term environmental effects within the Hume Exploration area which will be effectively managed using the mitigation and management measures outline[d] within this REF. Short term impacts which will be caused by the minor disturbance from drill holes and access tracks are not considered significant. Hume Coal is committed to managing and monitoring the impacts of its exploration activities and fully rehabilitating the areas of disturbance caused by the program.
8. Table 2.2 in the REF 3 is a summary of the proposed measures to prevent, control and mitigate potential environmental impacts associated with the exploration activities (p 1776-1780, EB vol 4). Proposed measures include, inter alia, the avoidance of creek crossings where these could have undue impacts, minimisation of the use of access tracks during or following rainfall, the inspection of all drill sites and new access tracks by a qualified ecologist to delineate sensitive ecological features and avoid impacts, a 40 km/h speed limit will be enforced on all access tracks, or slower if requested by landowner, rehabilitation works are to commence as soon as practical following completion of works and that all new tracks to be properly constructed, stable and drainage installed.
9. Concerning environmental management of the physical and chemical impacts of the proposed activity, the REF 3 provides in relation to "Soils and Land Stability" that, inter alia, any gravel used at the drilling sites and access routes will be removed upon completion, unless requested by the landowner. Original topsoil will be spread over the disturbed area and restored with pasture vegetation in consultation with the landowner (p 1815, EB vol 4). Concerning surface water, erosion and sediment measures include, inter alia, maximisation of ground cover retention, no disturbance to nature/pasture grasses and soil where possible, the rehabilitation of drilling sites and access routes in a timely manner and inspection to ensure rehabilitation has been successful, and exposure and disturbance of ground surface will be limited where possible to minimise erosion (p 1817-18, EB vol 4). Concerning air quality, environmental management measures include, inter alia, the monitoring of dust emissions and the use of water carts on access tracks and at the drill sites as necessary (p 1829, EB vol 4). The activity will avoid the clearing of threatened ecological communities through the location of drill sites and access tracks in previously disturbed areas (p 1837, EB vol 4).
10. Section 12 of the REF 3 deals with cumulative impacts both broadly and specifically in relation to the cumulative impacts of noise, dust, visual, water, traffic, and ecological and archaeological impacts (p 1872-76, EB vol 4). The original phase 3 exploration activity involving up to 90 boreholes out of a nominated 150 borehole locations over a five-year period was determined by the Department to have the potential for significant cumulative impacts. The REF 3 revised the program to reduce the intensity of drilling by, inter alia, reducing the number of proposed boreholes to 25, the time to two years, limiting the number of boreholes on small property holdings and using one drill rig at a time. The reduction in drilling intensity has further reduced the potential for adverse impacts associated with the proposed exploration activities which individually are minimal, highly localised and temporary. The combined impact on the economy of the Southern Highlands is considered positive but small as the combined impact on agriculture will be fully compensated for as part of the land access agreements. Hume Coal is the only known company conducting exploration activities in Authorisation 349. It is sole holder of that licence. It is unlikely that the works will contribute to any other activities that could cause cumulative impacts in Authorisation 349 (p 1872, EB vol 4).
11. The specific environmental objectives include mitigating cumulative impacts by utilising only one drill rig at any one time (p 1767, EB vol 4). The REF 3 states that this approach will address cumulative impacts on individual and neighbouring properties as it will avoid the cumulative impacts of noise that attend using multiple drill rigs, avoid cumulative traffic impacts on local roads, reduce the intensity of activities at any given location and reduce the total area disturbed at any time. While some boreholes will be located in close proximity to each other, they will not be drilled at the same time (p 1873, EB vol 4).
12. Further references in the REF 3 are: 12.1 Assessment of Cumulative Impacts … For this project, cumulative impact relates to the assessment of the previous Phase 1 and 2 programs and the potential for any additional exploration prior to or during mining. None of the private properties with proposed boreholes for the Phase 3 drilling activity have been subject to the Phase 1 or Phase 2 drilling activities. The property owned by Hume Coal, for which there is one borehole proposed, has previously been drilled on as part of the Phase 2 drilling activity (as shown in Figure 2B). The first approved exploration phase involved 120 drill holes of which only 36 were drilled. The Phase 2 exploration program involved an approved 90 boreholes while the current proposal involves 25 boreholes. Although the total number of exploration holes within the Authorisation is approximately 300, Hume Coal has completed 136 to date. This combined with the proposed with the proposed Phase 3 program will bring the total to around 161 undertaken by Hume Coal. The remaining holes were completed in previous periods dating back to 1950s by previous explorers. The number of future holes, in addition to the proposed Phase 3 activity is difficult to determine. Geological investigations will continue during detailed design as well as throughout any future mining activities. The intensity of this work however diminishes dramatically and tends to concentrate on specific geological structures or information gaps.
13. In relation to community impacts the REF 3 relevantly states (p 1843-1851, EB vol 4): Community Impacts 7.1 Social and Economic Profile … 7.2 Community Services and Infrastructure … 7.3 Economic Impacts The exploration for the Phase 3 drilling activity will occur on rural properties involved in low intensity grazing and lifestyle properties in an area focused on the central portion of the Authorisation. The proposed boreholes are located on 7 separate landholdings of which 6 will require land access agreements… 7.4 Landholder Impacts There will be both direct and indirect impacts on land holders. The direct impacts relate to loss of amenity during the drilling program, noise and dust emissions, inconvenience and the temporary loss of use of the land subject to drilling. Direct impacts can be mitigated to some extent but the temporary loss of amenity and inconvenience falls under compensation. The indirect impacts are impacts that may be caused by other associated or ancillary activities to the drilling either within or outside the area of direct impact and which may be reasonably foreseeable. Indirect impacts may include growth inducing effects and other effects related to changes in the pattern of land use, population density or growth rate and related effects on air and water and other natural systems. An example would be a project that causes increases in demand for social services such as housing, medical, electricity, sewage or education. As with direct impacts, indirect impacts can be positive, neutral or negative. It is also important to understand perceived impacts within the community which may not relate to actual impacts but are nonetheless important community issues. 7.4.1 Direct Impacts A workshop was held on 3rd July 2014 which included specialist consultants, land holders, and local famers to provide a means to access the social impact of the Phase 3 drilling project. The outcome of this process was the generation of a number of tables as outlined in the following sections. Table 7.2 identifies the direct impacts on individual properties. Direct impact is considered to be a function of how man holes are planned, how long it takes to drill them, whether the property is privately owned or owned by Hume Coal, accessibility and the impacts on adjacent properties, cumulative impacts and environmental factors all in relation to the size of the property. [Table 7.2 identifies the estimated direct impacts during the proposed phase 3 drilling activity for the 7 properties the subject of the REF 3. In estimating the direct impact Table 7.2 gives scores for, inter alia, alternate access, impacts on neigbours, environmental factor and social impact. Relevantly, for the Alexander, Pollicina and Fesen, Roche and Martin properties the table indicates a duration of between 2 and 9 weeks, depending on the number of proposed holes. Table 7.2 identifies an alternate access score of 1 for the Alexander and Pollicina and Fesen properties, and scores of 2 and 3 for the Roche and Martin properties respectively.] In determining the potential impacts on individual properties, the following factors have been considered in Table 7.2: Alternate Access refers to entering a property via different directions. A score of 3 indicates only one access and from a less utilised road. A score of 2 indicates possible multiple entry locations. A score of 1 indicates access options from different roads of various utility. … Social Impact is considered to be a function of; how many holes are to be drilled, how long it takes to drill them, environmental and cumulative factors, whether the property is privately owned or owned by Hume Coal, whether the property has been subject to previous drilling by Hume Coal, accessibility and the impacts on adjacent properties and all divided by the size of the property. The assessment also includes other mitigation factors such as using only one drill rig at a time to drill all holes. The hours of operation will be restricted to 7:00am to 6:00pm on private property, depending on Land Access Agreements or Arbitration Arrangements. Each and every landowner has different aspects that will cause them to be or to feel impacted. These aspects include; having to go through the Land Access Arrangement or the Arbitration Process, concerns about strangers accessing or working on their property, simply being in the district, noise impacts (which are minimised through distance and the use of modern equipment), duration of the drilling program, opposition to coal exploration or mining in general. Some of these aspects are difficult to quantify and for some persons there is no amount of money that would compensation for the impact. Nevertheless, the process outlined above is an attempt to put a guide together in a dispassionate way, to what can be an emotive issue. In order to categorise the social impact assessment in Table 7.2 and determine the level of impact on the nominated properties, various scenarios based on changes in drilling density were utilised to develop a range of categories as shown in Table 7.3. These impact categories range from Significant Social Impact with a direct impact ranking of 400 to negligible impact with impact rankings ranging from 4 to 0.4 [all of the social impact calculations for the properties the subject of REF 3 were below the impact ranking of 4]. … 7.4.3 Perceived impacts These relate to any impact which is considered important to any particular land owner but which may or may not be real, measurable or related to the actual exploration drilling. These are often caused by personal beliefs, understanding or mis-information. Hume Coal has some experience in dealing with these issues since the commencement of the drilling program. In response, Hume Coal has developed a series of information packages for land owners which cover issues such as the design and installation of an exploration hole, the actual impacts on the groundwater from drilling and matters relating to future mining, the incorrect perception that Hume Coal is drilling for coal seam gas, and land access agreements. Exploration drilling is similar in impact as the initial drilling of a water bore. As there are over 400 existing registered water bores in the Authorisation, such drilling activities are in fact relatively common and historically, the drilling and maintenance of water bores in the district have supported two local drilling companies. Despite this, there is still the perception that exploration drilling will cause adverse and/or new impacts on the social and natural environment. This is predominantly the result of the drilling being associated with a mining company as opposed to an existing landholder. It is not possible to completely satisfy land owner understanding of real impacts versus perceived impacts when perceived impacts are grounded in opposition to any future underground mining proposal. Where this occurs it needs to be recognised but it is not a governing factor in the assessment and approval process.
14. The REF 3 contains the following appendices: A Neutral or Beneficial Effects B Environmental Check lists C Assessment of Activity Significance D Habitat Assessment E Agricultural Impact Assessment F AHIMS Search Results G Noise Assessment H Weed Guides I Material Safety Data Sheets J Compliance Check List
15. The Agricultural Impact Assessment (appendix E) (also referred to as the Agricultural Impact Statement (AIS)) dated July 2014 prepared by International Environmental Consultants Pty Limited provides an assessment of the potential impacts on agricultural resources within Authorisation 349 as a consequence of conducting the exploration program. The AIS states (p 1929, EB vol 5): ES 1 Activity Overview This Agricultural Impact Statement (AIS) assesses the potential impacts of exploration drilling on Agricultural Land within Authorisation 349 as shown on Figure 1. The exploration activities will be undertaken by Hume Coal as part of its ongoing assessment of coal resources within the Authorisation. Hume coal commenced staged exploration in June 2011 with Phase 1 and 2 now complete. It is anticipated that a further 70 holes will be required to complete a detailed geological model and accurate JORC compliant resource model. This AIS has assessed the anticipated future 70 exploration holes which is defined in this report as the future exploration activity. This AIS has also assumed that each borehole will require an area of up approximately 625m2 for a period of less than 4 weeks. This timeframe includes initial set up, drilling and decommissioning. Set up does not typically involve earthworks as pad sites are only located on level ground to gentle slopes. On completion of drilling, which usually takes less than two weeks, the equipment is demobilised and any disturbed pasture is rehabilitated as soon as practicable. For the purposes of this assessment, the combined impacts on agriculture have been assessed, that is, a total of approximately 4.4 ha of agricultural land being excluded from production for a period of 12 months. The 12 month period has been used as a conservative approach and assumes that every drill site will require complete pasture replacement. This has never occurred to date and in reality, drill sites are returned to production shortly after the completion of demobilisation.
16. In 1996 the Department of Agriculture assessed the land within Authorisation 349 as being moderately productive lands suited to improved pasture rotation. Steeper areas were classified as not being suitable for cultivation with low to very low productivity for grazing (p 1950, EB vol 5). Concerning Wells Creek, the AIS states that the creek bank has been largely cleared and there are sections that display slumping and erosion. Some sections have been fenced to exclude stock but in general it is in a moderate to poor condition (p 1952, EB vol 5).
17. Section 3 of the AIS provides an "agricultural risk ranking" of various activities proposed in the REF 3, including access track construction, setting up the drill pad, the drilling activity and decommissioning the drilling site. The AIS finds that (p 1971, EB vol 5): … the proposed drilling program is unlikely to result in Level 4 Risk Ranking [Minor damage and/or short-term impact to agricultural resources or industries. Can be managed as part of normal operations] or above. The majority of steps in the drilling process will result in a Level 5 Risk Ranking [Very minor damage and minor impact to agricultural resources or industries. Can be effectively managed as part of normal operations]. Those items where a Level 4 ranking is provided relate to loss of agricultural production which although minor, is able to be calculated and would form part of the compensation under the land access agreements.
18. Impacts on agriculture and mitigation measures are identified in section 4. Various measures are identified to mitigate the impact to, inter alia, soils and erosion, weed management, hydrology and water quality, groundwater, air quality and noise. Concerning rehabilitation, the AIS states (p 1973, EB vol 5): 4.3 Rehabilitation … Rehabilitation of disturbed areas will be carried out following completion of the drilling works. The drilling activities will take up to 4 weeks to complete which will be followed by rehabilitation activities as required. All rehabilitation works on agricultural land will be taken in strict compliance with land owner requirements. Any specific rehabilitation works will be listed in the Land Access Agreements. The following general activities will be undertaken, but it is stressed that these matters are all open for negotiation: Temporary access tracks and associated disturbed areas not required by the land owner will be ripped, seeded and fertilised following completion of drilling or ongoing monitoring program. Any imported material used, such as gravel or crushed rock, will be removed from the property or if preferred by the land owner, used on existing formed access roads within the property. Following completion of track construction the area will be reinstated to its original condition in consultation with the land owner. Seed and fertiliser shall be applied to all ground in the vicinity of the access track where surface grasses have been removed or bare patches are evident. The drill site will [be] cleaned as necessary, harrowed to reduce soil compaction and sown. …
19. Concerning farm management and production, the AIS relevantly states (p 1975, EB vol 5): 4.5 Farm Management and Production The proposal involves up to 70 [sic] drill sites each measuring 25 m by 25 m (625m²) or a total of around 4.4 ha of agricultural land that will be impacted over the exploration program. Although there will be no agricultural land permanently lost as a result of the activity, the total combined impact would be 4.4 ha unavailable to normal production for a period of 4 weeks and then gradually returned to full production once rehabilitation works are established. A very conservative approach would be to assume that the entire drill area was not available for a period of 12 months. In reality, the actual period would be closer to two months.
20. Having regard to the mitigating investigations and control measures established to protect agricultural land and the temporary nature of the impacts, the AIS concluded that the activity will have minimal impact on agricultural resources and production. The risk assessment processed highlighted the low risk ranking and the high level of predictability given the history of exploration activities undertaken to date (p 1984, EB vol 5).

Expert reports

1. In Table 2.1 (p 1768-69, EB vol 4) and Figures 2A and 2B, (p 1764-65 EB vol 4) the REF 3 identifies locations for each of the 25 proposed borehole sites. Hume Coal tendered maps of the Roche, Pollicina and Fesen, Alexander and Martin properties showing approved borehole locations as shown in the REF 3, which identified the 100 metre radius around each borehole and indicated potential access routes (exhibit 4). Twenty of the 25 proposed borehole sites are located on the landholders' properties. These are HP357, HP362 and HP365 on the Roche property, HP231PC, HP253CH and HP265PC on the Pollicina property, HP202PC, HP295PC, HP214PC, HP402, HP456 and HP212PC on the Fesen property, HP245PC, HP346CH, HP352CH, HP351CH, HP345CH and HP048CH on the Alexander property, and HP371 and HP372/HP374 on the Martin property. The proposed borehole site on the southern side of the Martin property near the dam is identified as "HP372" in Table 2.1 of REF 3 and "HP374" in exhibit 4. This proposed borehole site will be referred to as "HP374". This discrepancy was identified by Mr Doyle, Hume Coal's exploration manager, in his affidavit affirmed 15 April 2015. Mr Doyle also identified and corrected the discrepancy between coordinates in Table 2.1 and coordinates depicted in Figures 2A and 2B for eight proposed borehole sites, being HP345CH, HP048CH, HP351CH, HP245PC, HP352CH, HP402, HP456 and HP374. Annexed to Mr Doyle's affidavit are maps clarifying this discrepancy.
2. SHCAG read the affidavit of Dr Davies affirmed 18 February 2015. Dr Davies is a practising environmental scientist and planner, and academic researcher on the environmental, social and economic impact of various activities. Dr Davies annexes his expert witness report to his affidavit. He had regard to the Division of Resources and Energy (DRE) document entitled "ESG2: Environmental Impact Assessment Guidelines for exploration, mining and petroleum production activities subject to Part 5 of the Environmental Planning and Assessment Act 1979" (ESG2 guidelines) dated March 2012, which became exhibit D. SHCAG read the affidavit in reply of Dr Davies affirmed 16 March 2015 to which Dr Davies annexes his report replying to Hume Coal's expert reports. Dr Davies' opinion is that when the infrastructure works and rehabilitation measures are considered together with the proposed boreholes, the activity is likely to significantly affect the environment (p 2914, EB vol 7).
3. In his expert report Dr Davies stated that while the impact of access and drilling at proposed locations located near public roads would likely have a minimal impact, many of the proposed boreholes near public roads are not proximate to existing gates or access ways. This is an impediment to access that will require access via existing gates traversing a number of paddocks, which will magnify environmental impact. Hume Coal is likely to need approximately 14.75 km of gravel access tracks across private land, requiring up to eight creek crossings and associated engineering works. Only a minor portion of estimated tracks could use the path of existing access tracks. Existing access tracks may need to be upgraded for use by heavy vehicles (p 2907-8, EB vol 7).
4. Dr Davies expressed concern with a number of proposed borehole sites that require crossing Wells Creek and other marked creeks or areas known to the property owners as overland flow paths. If access to HP357 on the Roche property entails the crossing of Wells Creek, surface treatment to the creek bed, bank and adjacent riparian area would be required to minimise impact. The strength and integrity of the bedrock is unknown (p 2908, EB vol 7). Dr Davies stated that impacts on the Roche property will be experienced during exploration and for up to at least two years after exploration as part of the rehabilitation that he considered necessary (p 2914,EB vol 7).
5. In the case of HP456 on the Fesen property, Dr Davies stated that at the time of his site inspection, the soil was wet underfoot for a width of approximately 40 metres. Access is proposed via the Pollicina property and crosses Wells Creek southwest of HP456. Dr Davies considered that given the period of drilling and number and type of vehicles that may be required, the impact on the riparian area is likely to be substantial under even dry conditions. The proposed access would require considerable track infrastructure to support all weather access sufficient to cope with the hydraulic forces of the creek during high flow conditions (p 2908, EB vol 7).
6. Paddock 7 on the Pollicina property, in which HP253CH is proposed, is subject to inundation and forms part of an overland flow path. The sensitivity of this area to inundation was highlighted by clearly visible wheel ruts associated with 4WD vehicle use and cattle prints at the entry to paddock 7. Major infrastructure will be necessary to support access to the borehole under wet conditions. This infrastructure is likely to have a significant impact on the environment by way of impacting on flow paths, surface disturbance and compaction (during construction and remediation) (p 29109 EB vol 7).
7. Dr Davies considered that access to HP374 on the Martin property is likely to be achieved by crossing an overflow path from the main dam to the east of the property. Access to this borehole would require a track of at least 150 metres to cross the overland area. The construction, use and remediation of this track would be likely to significantly affect the environment, particularly given the property's relatively small size (p 2910, EB vol 7).
8. In the case of HP351CH on the Alexander property, Dr Davies observed that the proposed borehole would seem to be affected by overland flow. He noted that construction of a suitable access track is likely to significantly affect the Endangered Ecological Community (EEC) (p 2912, EB vol 7). Dr Davies stated that the proposed location of HP345CH, also on the Alexander property, is approximately 50 metres from the centre of Wells Creek and is a generally flat area subject to overland flow and creek flooding. While moving the proposed borehole location away from the fence line would move the area of influence from the riparian zones, the construction of access tracks to this site would require substantial works which are likely to significantly affect the property and the environment (p 2910, EB vol 7).
9. Dr Davies also expressed concern with HP265PC on the Pollicina property and HP048CH on the Alexander property which in his opinion are likely to require cut and fill in order to accommodate their location on steeper slopes. The cumulative effect of the additional engineering and construction works that may be necessary in order to permit access over steep, wet and riparian areas is likely to lead to a significant impact on the concerned properties and the environment. Access to HP265PC will likely require the construction of a stabilised road (as used in the Koltai property in 2013) as the proposed access is via a moderately steep slope adjacent to the eastern property boundary and through Carters Lane. Access to HP048CH via the main driveway from Carters Lane is steep and may require alternate access (p 2910-11, EB vol 7).
10. Dr Davies stated that if the social and economic impacts are as the landowners assert in their affidavits, then he considers that the proposed activity is likely to significantly affect the environment (p 2913, EB vol 7).
11. In oral evidence Dr Davies acknowledged the capacity of Hume Coal to operate their drilling pads within a 100 metre radius provided good practice and flexibility. He maintained that the failure of the REF 3 to provide options on how access to borehole sites would be constructed and looked after was a significant shortcoming (TS 87/33-88/12).
12. In cross-examination Dr Davies stated that he had not been provided with a copy of Authorisation 349 and was not aware of what controls those conditions would impose on Hume Coal's activities (TS 117/4-43).
13. In response to a question concerning access to the Pollicina property, Dr Davies stated that "… there's assumptions here in terms of access and it's not for me to comment on who's granting what access where and how but for the purpose of the location as identified on the plan, there is a limitation on this site" (TS 128/28-35).
14. Hume Coal read the affidavit of Mr Doyle affirmed 9 March 2015. Mr Doyle has qualifications and experience relating to the planning and execution of mining exploration programs. Mr Doyle annexed his expert report to his affidavit. Concerning Dr Davies' statements about the impact of access and drilling at proposed locations located near public roads, Mr Doyle stated (p 2941, EB vol 7): Dr Davies has concluded that the impacts associated with the drilling activities at sites close to public roads are minimal. This conclusion relates the distance from the public road to the drill site. I would conclude that he has reasoned that the drilling activity has a minimal impact (whatever it is) and that the track distance is the element that leads him to conclude that some sites have significant impact. This 'significant impact' classification by Dr Davies is compounded by his assumption that the tracks are going to be constructed in a similar fashion with the Koltai construction. The assumption relative to the Koltai Road is incorrect for the reasons outlined above. Dr Davies assumes that a short track distance means minimal impacts and a longer track has proportionally more impact. However, the terrain for every site and every track will determine the specific environmental impacts. As Dr Davies notes some proposed bore sites could be easily accessible from public roads (or alternate properties). With landowner permission gates could be installed to facilitate easy access and reduced track lengths with an aim to minimise environmental impacts.
15. Mr Doyle disagreed with Dr Davies' assessment that Hume Coal is likely to require 14.75km of gravel access tracks. Mr Doyle stated that Hume Coal would seek to minimise any use of gravel and it is not in his experience that existing tracks need to be upgraded. Mr Doyle's assessment, based on his site inspection of 4 March 2015, is that the vehicles used in the drilling operations are not so excessively heavy that they would require track upgrades (p 2941-42, EB vol 7).
16. Mr Doyle also disagreed with Dr Davies' assessment that the proposed boreholes HP048CH on the Alexander property and HP265PC on the Pollicina property are likely to require cut and fill works. The need to undertake cut and fill operations can be addressed by a modest relocation of these sites (within the 100 metre radius) and the flexibility and manoeuvrability of the drilling equipment.
17. Concerning the standard of the access tracks, Mr Doyle states (p 2945, EB vol 7): I agree with Dr Davies' comment, that "Temporary access tracks and supporting infrastructure can be designed, used and satisfactorily rehabilitated on steeper slopes." The final design of new access tracks to proposed drill sites will be the subject of further review when and if access is granted. However having undertaken a site inspection and with my experience in the Southern Highlands I would suggest that access tracks on steeper slopes will be avoided in the first instance to locate more appropriate access and therefore not require construction work or lengthy rehabilitation. The tracks required for the purposes of drilling are short term requirements and do not need substantial infrastructure. The track in Mr Koltai's property is a permanent feature and not an access track. To relate the earthworks associated with the Koltai Road to short term borehole access tracks is inappropriate.
18. Mr Doyle provided details of the measures Hume Coal employs during wet weather (p 2960, EB vol 7): Wet weather is often factored into Land Access arrangements, where any wet weather days lost will 'stop the clock' on the period allowed to undertake the exploration activities. This ensures that there is no pressure to complete works and push operations during wet periods. In my experience Hume Coal has imposed numerous 'wet weather' days, i.e. 'no activity days' and had to pay the drilling contractor wet weather rates to cover this stand down. The decision is based on two aspects, potential impact to ground conditions (ie environmental harm) and safe working conditions for the operations. As Exploration Manager I am the person who approves the decision to stand down drilling activities due to wet weather conditions. I encourage my direct reports (geologists) to be conservative when making this decision. Often they are the ones at the property at the start of shift when the decisions have to be made. In my experience sometimes these decisions (to enter or not) are very easy to make, for example if the property is obviously too wet for vehicular access. While at other times the decision may require discussions with landowners or alternatively if there is doubt about gaining access then my practise is to wait - give the property a couple of hours of sunshine and a re-inspection and if the tracks are deemed accessible without causing disturbance then allow the drilling crew onto the property. In places where conditions are wet or thought to have the potential to deteriorate due to moisture then 'mud mats' are used to assist keep the tracks in good order. Mud mats are also known as track mats or bog mats. Mud mats are hard plastic rectangular shaped sheets with measurements of approximately 1000240012mm. They essentially redistribute the load of the vehicles travelling over the mat and do not allow the grass layer to die off. From my experience using mud mats over short time frames required does not kill the roots of the grass … It has been my experience that if a small boggy place was encountered on a track sometimes gravel is placed to assist with access. This is only placed with the permission of the landowner. It is often seen as an asset by the landowners and is left there for their benefit. Gravel improves their access track especially in times of wet weather. But should the landowner not require it then it would be removed.
19. Mr Doyle's expert report also addressed statements made in the landowners' affidavits concerning borehole sites on the Roche, Pollicina, Fesen, Alexander and Martin properties. In respect of access to each of the proposed boreholes these properties, generally Mr Doyle's opinion was that access could be achieved without a significant impact or that there would be a negligible impact. Concerning the Roche property, Mr Doyle stated that Hume Coal could consider relocating HP357 to the area shown in Dr Roche's affidavit as the "400 horse trucks, floats, competition and spectators vehicles parking area" as long as it is within 100 metres of the original site where "any access or drilling impacts [sic] be negligible" (p 2970, EB vol 7).
20. Concerning HP365 Mr Doyle stated that while he observed one area of moist ground there would be no significant impact issues bringing the drilling equipment onto the site via the route he took past the club house and other building on his site visit. The proposed borehole site could be relocated to the fence to minimise impact on the cross country course. Access via Kardinia Lane is one of many access routes. An alternate route to HP365 could be sought to minimise travel through low and wet areas and mud mats could be used (p 2948, 2968, EB vol 7).
21. Concerning borehole HP362, Mr Doyle did not believe there are any issues with drilling this hole as planned along the fence line. He noted that the ground was sturdy in that area and any compaction from vehicle movements would be easily restored. There would be no need to construct any access tracks or enter via the gate near the house if the gate with entry through Golden Vale Road was reinstated (p 2948, 2969-70, EB vol 7).
22. Addressing Mr Pollicina's concerns about borehole locations interfering with his ability to use certain paddocks on the Fesen property, Mr Doyle stated that HP202PC and HP295PC could be relocated within the approved 100 metre radius. Both of these proposed boreholes are located in dry and firm ground. Relocation of HP202PC would take it to flatter ground. Mr Doyle stated that the path he took to HP295PC on his site inspection would be suitable for heavy equipment to travel and that ground truthing may assist in reducing access track length (p 2972-74, EB vol 7). Gate access to HP212PC would avoid wet ground. Mr Doyle had no difficulty accessing HP214PC or HP402, which were located on elevated, dry and firm ground. Accessing HP214PC via Mr Pollicina's laneway rather than the path he took on his site inspection may be more suitable (p 2973-74, EB vol 7). Access to HP456 crossing Wells Creek would not have a significant impact but there could be a minor or moderate impact, which could be ameliorated by using earthworking machinery to flatten out ruts put in by access. Mr Doyle would prefer to avoid Wells Creek altogether by obtaining landowner permission to access the proposed drill site from the east across the Pollicina property. Alternatively, the borehole location could be relocated so to avoid the issue of dealing with two landowners or dropped from the exploration program (p 2974-76, EB vol 7). Accessibility to HP231PC, HP253CH and HP265PC on the Pollicina property was satisfactory and shorter access tracks might be available with further ground truthing (p 2976, EB vol 7).
23. Addressing concerns raised in respect of the Alexander property, Mr Doyle stated that HP245PC could be relocated to address issues relating to the interaction of cattle with the exploration activities. HP346CH and HP352CH were easily accessed and the ground was dry and firm. HP352 could be relocated as required to avoid wet ground. HP345CH is close to Wells Creek and would benefit from being relocated to higher ground. Mr Doyle did not believe that HP351CH is located within the EEC. Mr Doyle's comments regarding HP048CH are identified above at par 65 (p 2955, 2976-77, EB vol 7).
24. Addressing HP371 on the Martin property, Mr Doyle stated that HP371 could be easily accessed via the main entrance and the gate on the northern side of the entrance road. A water course to the north west of the gate was dry at the time of his site inspection, but Mr Doyle would recommend the use of mud mats as a precaution. Access to HP374 includes wet ground along the line of the watercourse on the lower side of the dam. In Mr Doyle's opinion access would have minimal impact if mud mats were used in a dry period, but wet ground conditions could cause impacts that would require rehabilitation. Mr Doyle would recommended Hume Coal seek alternative access or relocate the proposed borehole site (p 2977-78, EB vol 7).
25. Some details of the proposed drilling operation were provided by Mr Doyle in his oral evidence. The drill weighs approximately 8-10 tonnes. It is brought onto a property by a truck of similar weight, but then moves around the property on steel tracks (TS 102/3-103/8). The compressor either moves freely between drill locations or is carried on the back of a wheeled device (TS 103/20-104/27). The water truck carries eight tons of water and normally accesses the drilling site once a day. If things are abnormal, that is in difficult drilling conditions, access three to four times a day may be required (TS 104/29-105/3). The rod rack and fencing are brought in by truck (TS 105/5-50). To Mr Doyle's knowledge, the REF 3 does not impose a daily limit on the number of vehicles accessing each drill site (TS 106/43-107/11).
26. Mr Doyle gave oral evidence that in his experience, having seen the level of impacts of boreholes on many properties, the impacts in this instance can be fully rehabilitated in a short space of time. He does not believe there will be significant impacts in an environmental sense (TS 94/23-26).
27. Hume Coal read the affidavit of Mr Gardyne affirmed 9 March 2015. Mr Gardyne is a practicing environmental scientist and has particular expertise in soils and rehabilitation of disturbed environments. Mr Gardyne annexed his expert report to his affidavit. In his expert report Mr Gardyne referred to a flat nondescript place where water flows as a "flow-path", an area with vegetation dominated by aquatic vegetation (cf pasture grasses) as a "waterway, and one with a distinct back as a "creek". He stated that "the former is not considered to have a riparian zone as it fails the [Land and Water Resources Research and Development Corporation's] functionality test" (p 3006, EB vol 8). Based on the REF 3 and his site observations of 4 March 2015, Mr Gardyne was of the opinion that the only waterway of any significance is Wells Creek, and that both its catchment bed and banks have been, and continue to be highly disturbed through historic clearing and grazing activities. Most other areas observed by Mr Gardyne were overland flow paths, not defined waterways (p 3012-13, EB vol 7).
28. Mr Gardyne considered that Dr Davies' expert report overstated the presence of, and the impacts on, riparian areas and that there seemed to be an underlying inference that the existing environment has not been impacted upon by existing land uses. If the receiving environment is already degraded, a small additional disturbance is unlikely to have "significant impact" (p 3013, EB vol 7).
29. The only waterway of note that might be affected by the proposed project would be a potential crossing of Wells Creek in accessing HP357 on the Roche property. Mr Gardyne observed a firm rock foundation and no significant turbidity created by the crossing of a light vehicle. Mr Gardyne concluded that the impact of more than 1,000 visitors for an extended period for equestrian activities, of which he was advised during his inspection, would be greater than the required four vehicle movements per day over an eight week period for the drilling program. There is a wet location on the proposed access track to HP365 that could become boggy when inundated. Any impact on this crossing could be managed by using the access track when the crossing is dry, in accordance with the time of year and/or the landowner dropping the level downstream as was being done for an upcoming equestrian event at the time of inspection (p 3013-14, EB vol 7).
30. Concerning HP212PC on the Fesen property, gate access off the service road adjacent to the Hume Highway would preclude the need to cross the waterway in accessing the proposed borehole site. However, crossing the waterway would not have a significant impact if crossed at drier times of the year or with temporary stabilisation. Concerning borehole HP456, which is beside Wells Creek on the Fesen property, access is likely to be damp for much of the year. This could be made an all-weather crossing without adverse waterway impacts by placing rock over geofabric. Drilling may need to occur during a drier period of the year to minimise impacts and rehabilitation costs. Concerning HP351CH and HP345CH on the Alexander property, Mr Gardyne did not observe any waterway constraints as both of these proposed borehole sites can be relocated within a 100 metre radius away from wet ground (p 3014, EB vol 7).
31. Access to HP374 on the Martin property may be problematic at various times as it crosses the overflow path from the main dam, and appears to be permanently wet. Mr Gardyne disagreed with Dr Davies' conclusion that a track of at least 150 metres would be required to cross the overland flow area and that this would likely significantly affect that environment. Mr Gardyne stated that while wetter times may need to be avoided, a crossing could be effected and rehabilitated. Alternative access could also be negotiated (p 3014, EB vol 7).
32. Mr Gardyne gave oral evidence about his involvement in the rehabilitation of some coal seam gas fields. He assumed, based on the size of the drill rig being used by Hume Coal, that grass will probably be compacted and that some of it will be pressed into the ground, but there would not be a total disturbance. As a result, the actual amount of erosion and potential for erosion is quite low (TS 125/36-44). He did not see any constraints to rehabilitation and referred to the Koltai property as an example (TS 87/26-28).
33. Mr Gardyne also gave oral evidence that he considered that the REF 3 included sufficient detail concerning rehabilitation. The REF 3 identifies higher risk locations and looks at ways to minimise the associated risk. In his opinion, the operations of both access and drilling are quite low risk in this instance. He stated that the actual method of rehabilitation would probably be the subject of discussions with the landowner, and what they require, such as having a specific species of grass put in (TS 133/9-21).
34. Hume Coal read the affidavit of Mr Richardson, ecological consultant, sworn 9 March 2015 which annexed his expert report addressing the possible impact of a proposed borehole site (HP351CH) in the EEC on the Alexander property. This ceased to be an issue, as identified in par 86 below.
35. Dr Davies, Mr Doyle, Mr Gardyne and Mr Richardson prepared a joint expert report dated 16 March 2015, which outlines the issues agreed and disagreed between them. Dr Davies and Mr Doyle disagreed on the impact of the access tracks on the properties. Mr Doyle estimated that 40% of the estimated length of the access tracks would rely on existing tracks and contends that this would substantially reduce the surface area and thus overall impact of the project on the environment. Dr Davies contended that the REF 3 made an assumption that the property owners would permit the use of their existing tracks and that this would have a direct bearing on the estimated length and overall impact. Dr Davies and Mr Doyle broadly agreed on the total length of the access tracks and that this length and surface area comprises approximately 1% of the combined properties (TS 90/16-20). Mr Doyle contended that this is a small area in terms of the overall property and surface impact, whereas Dr Davies contended that other factors such as proximity to household, location and impact on environmentally sensitive areas and the overall use of the property must also be considered (p 109-10, tab 100, EB vol 7).
36. Dr Davies and Mr Gardyne primarily disagreed about the degree of disturbance. Whereas Mr Gardyne considers that the background environment is significantly disturbed and that the small level and duration of the impact will have no long-term impact, the lack of detail in the REF 3 on issues relating to access tracks led Dr Davies to conclude that the impacts are likely to be significant. The experts also disagreed on the definition of riparian zones, the level of impact associated with the construction of tracks, impacts of extreme rainfall events on the proposed activity and its consideration in the REF 3, the specific disturbance associated with proposed access tracks and accessing HP456 on the Fesen property during dry periods. The experts agreed that current and historic land uses have significantly altered the landscape (p 111-13, tab 100m EB vol 7).
37. Dr Davies and Mr Richardson agreed that the proposed exploration program is not likely to have a significant effect on the EEC on the Alexander property so long as the proposed drill sites and access tracks are developed in accordance with the controls in the REF 3 (p 117, tab 100, EB vol 7).

Lay witnesses

1. SHCAG read in part the affidavit of Mr Pollicina, landowner, sworn 18 February 2015 and read his further affidavit sworn 11 March 2015. Mr Pollicina owns the Pollicina property and is the sole director and shareholder of the adjoining Fesen property. Mr Pollicina farms cattle and uses a number of his paddocks on a rotational basis. He expressed concern about his underground watering system. Mr Pollicina outlined his concerns and the impacts on him of the arbitration process for access arrangements.
2. Concerning proposed boreholes on the Pollicina property, Mr Pollicina stated that the borehole located in paddock 3 (HP265PC) is at the base of a quite steep hill close to a soft and boggy area, the borehole located in paddock 7 (HP263CH) sits in the wettest corner of that paddock and the borehole located in paddock 8 (HP231PC) sits within soft and often boggy ground.
3. Concerning proposed boreholes on the Fesen property, Mr Pollicina stated that the borehole located in paddock 11 (HP456) and the borehole located in paddock 12 (HP402) sit in very soft and often very boggy land. Boreholes in paddocks 1 (HP212PC), 2 (HP202PC), 7 (HP214PC) and 8 (HP295PC) all sit within the lowest or second lowest lying areas of the contour map. The boreholes located in paddock 2 (HP202PC) and 8 (HP295PC) are in the middle of the paddock and will interfere with Mr Pollicina's ability to use these paddocks. A number of the boreholes are located almost on top of the water trough and water trough reticulation infrastructure.
4. Mr Pollicina's affidavit in reply details his significant improvements, being existing roads and cattle laneways which he will not give his consent for Hume Coal to use.
5. SHCAG read in part the affidavits of Mr Martin and Mrs Martin, owners of the Martin property, affirmed 18 February 2015 and read an affidavit in reply of Mr Martin affirmed 11 March 2014. Mr and Mrs Martin graze cattle, grow lucerne and have a truffiere. Since purchasing the property in 2002 they have made a number of improvements including the construction of a dam, a house and an 800 metre driveway.
6. In his affidavit affirmed 18 February 2015, Mr Martin states that for the last four years he has spent at least 25-30 hours most weeks working on Hume Coal related activities. The continuous grind of fighting Hume Coal over more than four years has caused him and Mrs Martin considerable anxiety, frustration and anger. They have been unable to pursue investment opportunities and delayed the development of their commercial truffiere. Mr Martin cannot be sure that this will be Hume Coal's final attempt to access his land since Hume Coal indicated in their REF 3 that they may require the drilling of up to 70 boreholes. In January 2014 Mr and Mrs Martin were notified of Hume Coal's intention to drill on their property. Mr and Mrs Martin and Hume Coal have not been able to agree on the appointment of an arbitrator. He expects that there will be significant costs to him and Mrs Martin as a result of the REF 3 involving arbitration and a possible hearing at the Land and Environment Court.
7. Mr Martin stated that Hume Coal's proposed boreholes are located in paddock 1 (HP374) and 2 (HP371). There are no existing access tracks leading to these locations. Mr and Mrs Martin do not consent to Hume Coal accessing these locations across the paddocks or to access from Golden Vale Road by cutting fences and removing trees. Paddock 1 contains a boggy area which is almost permanently boggy and impassable to heavy traffic. A utility has been bogged in paddock 1. Paddock 2 contains some boggy areas difficult for heavy vehicles to cross when it is wet. A tractor harvesting lucerne left deep ruts when it was raining.
8. Mr Martin is the convenor and a director of SHCAG. The purpose of SHCAG is to represent the landowners of the Southern Highlands wishing to protect their land from the impacts of coal exploration and mining. To this end, SHCAG has been involved in, among other things, fundraising to promote the cause of "no new coal mining or CSG [coal seam gas (CSG)] in the Southern Highlands" and has collected signatures for a petition to prevent new coal mining and CSG in the Southern Highlands. Mr Martin states that some measure of community concern regarding Hume Coal's past and future activities may be indicated by, among other things, SHCAG's regular mailing list of 4,000 supporters, 197,796 visits to the SHCAG website and $452,000 raised in the Southern Highlands Preservation Fund.
9. Mr Martin's affidavit in reply identifies significant improvements. He noted that the photographs in the Site Inspection Report (annexure K to the Assessment Report) appear to be taken over a boundary fence or through the front gate.
10. In her affidavit Mrs Martin stated that she has been campaigning against Hume Coal's exploration for an underground coal mine for four and a half years. She is very worried about what is happening to the local community and what will happen if a mine is ever built. Mrs Martin stated that the new approval for 25 more holes makes her really angry because of the time it is all taking, with no end in sight. Mrs Martin explained that her own experience has been an overwhelming feeling of helplessness, anger, anxiety and fury.
11. SHCAG read in part the affidavit of Mr Alexander sworn 18 February 2015 and the affidavit of Mrs Alexander sworn 11 March 2011. Mr and Mrs Alexander own the Alexander property. Mr Alexander stated that he does not and will not give his consent to Hume Coal to access the significant improvements to the property. He identified the improvements he and Mrs Alexander have made to the property since they purchased in 1999, which include upgrading and maintaining Carters Lane and construction of a house, an underground water reticulation system and fences. Mr Alexander is determined to continue, as he has since 2012, to resist access to the Alexander property by Hume Coal. If Hume Coal drills on his property his view from the deck of his house will be interrupted by drill rigs, drill sites and access track, which he will have to look at this until it is fully rehabilitated.
12. The arbitration process began in January 2013. The arbitrator has been calling for submissions on various matters from the parties including him. Over the period from 2013 to 2014, Hume Coal proposed several different configurations and numbers of drill sites on the Alexander property. In 2013 Mr Alexander saw on many occasions trucks involved in drilling on the Koltai property do U-turns across the lawn on Carters Lane and observed wheel ruts in his garden between Carters Lane and his driveway. Photographs of the resulting wheel marks and state of Carters Lane were annexed to Mr Alexander's affidavit (annexure RA17). Mr Alexander was furious when he saw this disregard for his property. He stated that Carters Lane, which was always a pristine laneway, beautifully maintained and a delight to drive on, was trashed by Hume Coal's activities. It was distressing driving up Carters Lane with its pot holes and wheel ruts left by Hume Coal. Mr Alexander waited for over a year for Hume Coal to repair Carters Lane.
13. Mr Alexander raised a number of concerns about the proposed borehole sites on the Alexander property. The borehole proposed in paddock 15 (HP351CH) is located in an EEC. (This issue is resolved, see above at par 86). The borehole proposed in paddock 9 (HP345CH) is very close to Wells Creek. Mr Alexander has nearly bogged a 4WD in that area at a time when it was not that wet. Paddock 6, in which a borehole (HP352CH) is proposed, is very wet even in drier months. The most northern borehole is in paddock 4 (HP245PC) where the cattle get their shelter. Moving this hole would place it either up a slope or into the middle of the paddock. The borehole in paddock 2 (HP048CH) is on a slope very close to a drainage channel. Mr Alexander stated that this proposed borehole location appears to be within 200 metres of the Mr Pollicina's land, which is protected by the Mining Act.
14. In her affidavit Mrs Alexander gave evidence about the arbitration process and claims that the improvements identified by Mr Alexander in his affidavit are significant improvements. She does not consent to Hume Coal accessing borehole HP351CH via their cattle laneways, driveway and Carters Lane.
15. SHCAG read the affidavit of Dr Roche sworn 19 February 2015 and an affidavit in reply of Mrs Roche dated 11 March 2015. In her affidavit Mrs Roche, part-owner of the Roche property Araluen, identifies improvements to the property that are claimed as significant improvements. No reference was otherwise made to this affidavit by SHCAG.
16. Dr Roche is the President of the Berrima Horse Trials and son of the owners of the Roche property. His evidence was that there would be a reduction in the recreational value of the locality as a result of drilling on the Roche property. There would be an adverse effect on the Roche property and its equestrian eventing course which has social significance for the wider eventing community as well as the local community. The equestrian eventing course comprises 155 of the 160 acres of the Roche property.
17. In his affidavit he stated that the Berrima Horse Trials Club and cross country course plan an ongoing central role in the training of members of the Australian Equestrian Three Day Event Team, the winners of four Olympic medals. NSW's elite riders compete at the Roche property and some also train there. If the eventing facilities at the Roche property were not able to be used for three months according to Hume Coal, or two to three years as Dr Roche estimates, this would impact on the riders and rankings of riders across NSW. Dr Roche disagreed with Hume Coal's estimate of three months (one month for each of the three holes). There could be no eventing competition or training when earthworks, drilling or rehabilitation was occurring on the property due to safety issues. The visual impacts, noise and vibrations would unsettle even the most mature horses. If only one hole is drilled it will impact upon the ability of the Roche property to operate as an equestrian eventing venue. Competitors will not continue to come to the property if the footing is uneven or disturbed.
18. Dr Roche considered that there would also be an impact on the Southern Highlands community generally. Pony clubs would not be able to be run and Oxley College would lose their largest fund raising event. His estimate is that approximately $500,000 is spent in the community over the course of the year on, among other things, accommodation, restaurants and items associated with horse events. There have been over 4,535 competitors at equestrian events on the Roche property over the last four years, with between five and seven people attending for every competitor. This figure excludes competitors taking part in training, school events and other activities. Concerning direct economic impacts of Hume Coal's activities, Dr Roche states that fixed assets, such as cross country fences, jumping arenas, improvements to the dressage arena footings and more would be lost if the Roche property was not able to be used for eventing competitions or training. As an example of an indirect economic impact, he gives an estimate of the cost of holding a twelve week program at Sydney Olympic Equestrian Centre as being $360,000.

HP357

1. In his affidavit, Dr Roche stated that the northern drill hole (HP357) is shown located in the middle of a dressage arena. The dressage arena could not be used and thus no eventing competition could be held. Dr Roche estimated that it would take two to three years to return the footing of the dressage arena area to the current international standard. He is unaware of any dressage arena which has been successfully rehabilitated to international standard following use by heavy vehicles and machinery. Even assuming it could be rehabilitated, he estimated the cost to be between $150,000 and $300,000.
2. In cross-examination Dr Roche stated that if the borehole location of the northern borehole (HP357) was moved out of the dressage arena into the designated car park used for competitions, it would not interfere with the eventing course (TS 151/40-152/2). Dr Roche referred to an incident in which a truck was bogged in the parking area and stated that as the parking area is not part of their actual course, the amount of repair required was not as much as if it was on the course. Dr Roche went on to say that after that particular incident he and the people with him made a decision that henceforth trucks could only go on the top site of the hill nearest to Kardinia Lane as too much damage had been caused. The Roches built a dam and swales in that paddock to try to dry it out, but were unsuccessful (TS 149/22-34).

HP365

1. In his affidavit, Dr Roche stated that the more direct access road to the south western hole (HP365) would render between 15-20% of the cross country course unusable for the duration of construction, survey and rehabilitation, lasting two to three years. The loss of even 10% of the cross country course would prevent Berrima Horse Trials from holding an event at a level above pre-novice. No international events could be held. Dr Roche stated that the most direct access to this hole would either involve passing through the main club house area (which is significantly improved), along the fence line to the south of the property or through the car park and straight across the show jumping warm up arena, rendering it unusable. Dr Roche does not consent to either method of access. Alternate methods of access would involve passage through low and soft areas.
2. In cross-examination, Dr Roche explained that trucks did not always do damage to the course, it depended on the weather (TS 148/28-37). Dr Roche stated that a concrete truck that delivered the concrete for the floor of the club house accessed the Roche property from Kardinia Lane. A water bore drill rig almost definitely accessed the Roche property the same way as the concrete truck. The Roches have had heavy vehicles with road base access their property at times, which are brought in the spine road on the northern side of the creek. Trailers and bobcats are used to move the road base around (TS 150/46-151/33). Dr Roche stated that driving a truck down part of the course would render it "unusable for probably two years" (TS 154/27-29).

HP362

1. In his affidavit, Dr Roche stated that the eastern survey hole (HP362) is also in the cross country course. Ten per cent of the course would be rendered unusable for two to three years as a result of the construction and rehabilitation of the proposed access road to this site and rehabilitation would cost between $100,000 and $250,000. There would be no events above pre-novice and no international levels during that time. In cross-examination Dr Roche stated that there used to be a gate on the fence line bordering Golden Vale Road near to the proposed location of HP362 (TS 149/39-45). Trucks carrying hay used to access the Roche property through this gate (TS 148/13-15). The Roches' sharefarmer had used the paddock in which HP362 is proposed for grazing cattle (TS 149/50-150/2). Dr Roche gave an example of a truck carrying hay that became bogged in part of the eventing arena. Use of a vibrating roller and aerator were able to fix the damage to the cause. The Roches were not required to stop eventing for two or three years while it rehabilitated. They did not use that area of the track for about a year and were able to use other areas of track (TS 147/11-148/44). Dr Roche stated that, if the footprint of HP362 was confined to a 25 x 25 metre square adjacent to Golden Vale Road, "it may be possible" to design a course that avoided it, but that the drill sites he had seen in Belanglo State Forest and near the railway line at Exeter were not confined to a 25 x 25 metre square (TS 153/9-32).

Rulings on evidence

1. It is useful to clarify what evidence relates to which ground of review in light of determinations made under s 136 of the Evidence Act in the course of the hearing.
2. On 27 March 2015 I ruled that the evidence of Dr Davies was limited to the alleged breach of s 112 of the EPA Act (TS 81/10). I also directed that annexures VR6 to VR12 to the affidavit of Dr Roche may be used only for the purpose stated at par 40 of that affidavit (that is, to emphasise the role of Berrima Horse Trials in our national sporting performance), and not otherwise to establish the truth of representations made, opinions offered or matters referred to therein to any other effect (TS 139/1-28).
3. On 27 April 2015 I directed that reports annexed to the affidavit of Mr Pollicina sworn 18 February 2015 (annexure FP11) by an agronomist assessing the pastures of the Fesen and Pollicina properties are not to be used to prove the truth of the matters asserted therein (TS 181/29-35).

Unresolved evidence challenges

1. On 27 April 2015, the Minister applied for a direction that the evidence of Dr Roche be limited to the alleged breach of s 112 of the EPA Act. The application was made on two bases. Firstly, the construction of s 111 advanced by the Minister meant this evidence was irrelevant. Secondly, nothing in the material before the Minister triggered a duty to inquire in respect of that evidence. I declined to rule on that direction and the evidence was heard subject to any subsequent ruling the Court might make (TS 134/47-135/44). I find below that no duty to inquire arose from the material before the Minister's delegate. It therefore follows that none of Dr Roche's material is relevant to the s 111 ground.
2. A further evidentiary issue to resolve according to Hume Coal is whether Dr Davies' evidence about the shortcomings of the REF 3 can be relevant. His evidence is directed only to the s 112 challenge (TS 81/4-8). The adequacy of the REF is irrelevant to that contest. I will consider this question when I consider s 112.

Scope of "activity" in s 110

1. A key issue to resolve in the application of Pt 5 of the EPA Act is the scope of the "activity" to be assessed in the circumstances of this case. SHCAG submitted that "activity" is widely defined in s 110 and that is the approach the Court should take to defining "activity", namely, as broadly as the definition allows. The "activity" for the purposes of s 110 must reflect the definition of "the use of land and the carrying out of work for the purpose of exploration" which includes other uses related to drilling such as access to drilling locations. It must include not only the 25 boreholes the subject of the REF 3, but also a further 45 potential boreholes likely to be needed as part of a possible 70 boreholes identified by Hume Coal in the executive summary to the REF 3 (pp 1754-55, EB vol 4, see par 30) and the executive summary to the AIS (p 1929, EB vol 5, see par 43). Also included and requiring assessment must be related activities such as the actual access to the boreholes which would inevitably involve the formation of new access tracks. Such an approach is supported by Queensland Conservation Council Inc v Minister for the Environment and Heritage [2003] FCA 1463.
2. The Respondents submitted that SHCAG's approach to the statutory construction of "activity" in Pt 5 is incorrect. A Pt 5 assessment requirement is not triggered by anything falling within the definition of activity under s 110. The obligations in ss 111 and 112 apply to a determining authority considering an application for an exploration licence for a defined activity. An "activity" not requiring the approval of a determining authority is not subject to ss 111 and 112. Identification of the "activity" in any given case is a matter of fact to be determined by reference to the evidence, not by reference to the statutory definition. Defining the "activity" is a question of fact.

Finding on scope of activity in s 110

1. The Respondents' construction of "activity" for the purposes of this case is correct. As a matter of fact the "activity" described in section 2.3.1 of REF 3 (par 30), in similar terms the Assessment Report in sections 1 and 4.2 (par 28) and the Activity Approval (par 27) was the drilling of 25 boreholes. That consent may be sought for future boreholes as canvassed in the REF 3 does not result as a matter of statutory construction in requiring the Minister to now consider the activity to include unspecified boreholes. There is an obvious practical impediment to doing so as their possible location is unknown so that there is nothing at present to assess.The natural consequences of the activity of drilling 25 boreholes were required to be assessed under s 111 of the EPA Act, a matter I consider next. Queensland Conservative Council is not an impermissible segmentation of activity case, as the Respondents submitted. In that case the downstream impacts of cotton farms using chemicals was found to be a natural consequence of a proposed dam project, the impacts of which required assessment at the approval stage. The same reasoning can be applied in this matter to the carrying out of the phase 3 program consisting of 25 boreholes.
2. The activity is the 25 boreholes with associated activities such as rehabilitation to the extent that those activities can be conducted in a manner consistent with applicable conditions. The REF 3 makes it clear that consent is sought for 25 not 70 boreholes.

The scope of ss 111 and 112 of the EPA Act in Fullerton Cove

1. SHCAG relied on Fullerton Cove Residents Action Group Incorporated v Dart Energy Ltd (No 2) [2013] NSWLEC 38; (2013) 195 LGERA 229 in relation to the nature and scope of the duty in ss 111 and 112 of the EPA Act. Pepper J held at [142]-[156], [149], [298]-[300] as follows: 142 The language of s 111 makes it plain, in my view, that the duty to consider to the fullest extent reasonably possible all matters affecting or likely to affect the environment by the activity in or to discuss the function of question extends to both a decision-maker's duty to examine these matters and the duty to take them into account. That is to say, the duty must be exercised both at the examination stage and at the consideration stage in order to discharge the function of assessing the effect or likely effect on the environment of the activity in question. It is, in effect, two duties masquerading as one. 143 The duty to take into account to the fullest extent reasonably possible all matters affecting or likely to affect the environment is, on any view, to be assessed objectively by the Court on the material before the decision-maker. By analogy with the traditional ground of judicial review of failing to take into account a mandatory relevant consideration, extraneous evidence, including expert evidence, is not relevant to the judicial task of determining whether or not there has been compliance with this limb of the statutory duty contained in s 111. 144 More difficult, however, is the first limb of the duty contained in s 111, namely, the duty to examine to the fullest extent reasonably possible all matters affecting or likely to affect the environment. The verb "examine" is defined to mean, amongst other things, "to inspect or scrutinise carefully; inquire into or investigate" (The Macquarie Dictionary, online edition) or "to inquire or search into, investigate (a question or subject); to consider or discuss critically; to try the truth or falsehood of (a proposition, statement etc)" (Oxford English Dictionary, online edition). This strongly suggests, therefore, especially when the central importance of the section is recalled, and having regard to the context, scope and purpose of Pt 5, the factors listed in s 5A, and the objects contained in s 5 of the EPAA, that something analogous to a Prasad like duty to inquire is embedded within s 111. If this is so, expert or other extraneous evidence may be admissible to show what inquiries ought to have been made as a precursor to the examination exercise, and if they had been made, what those inquiries would have revealed. 145 In formulating the duty contained in s 111 in this way it must be emphasised that this does not provide unfettered licence to litigants to adduce expert evidence in a bid to persuade the Court that the decision arrived at by a determining authority was wrong or, alternatively, to invite the Court to substitute its own decision for that of the decision-maker. An inquiry by the Court into whether a determining authority has complied with s 111 must not be permitted to turn into an examination of the merits of the decision. 146 In addition, it may be expected that any party seeking to rely on this aspect of the duty contained in s 111 of the EPAA would make this abundantly clear in the pleadings. Points of claim alleging a bare breach of s 111 by reason of the failure to have regard to certain matters will not suffice. This will engage only the second limb of the duty, viz, the duty to take into account to the fullest extent reasonably possible all matters affecting or likely to affect the environment. … 149 In this context two principles should be noted. First, that the obligation contained in s 111 does not impose on a determining authority a standard of absolute perfection or a standard of compliance measured by no other consideration than whether it is possible in fact to carry out a particular investigation (Prineas at 417 per Cripps J). To reiterate, the duty is to consider to the fullest extent reasonably possible all matters affecting or likely to affect the environment. No more and no less. Second, the decision-maker does not make the determination "in a vacuum" (Schroders Australia Property Management Ltd v Shoalhaven City Council [1999] NSWLEC 251; (1999) 110 LGERA 130 at [34] per Pearlman J). The determination of the Department must be scrutinised against the history of the pilot program, the Department's prior knowledge and experience gained by its dealings with Dart in relation to the drilling of gas wells, and from other investigations undertaken in the geographical area covered by PEL 458. … 298 As in Timbarra, it was submitted by Dart and the Department that the fact that the obligation to prepare an EIS was "triggered by a formulation requiring the exercise of a broad judgment on a matter of potentially significant disputation" (Timbarra at [88]) and could result in inconvenience by a determining authority erroneously deciding that an EIS is not required creating the potential for any subsequent decision granting approval or carrying out an activity to be set aside (at [91]-[92]), militated against the finding of a jurisdictional fact. 299 Three responses may be given. First, it is not always the case that matters of judgment involved in determining facts, including matters of fact and degree, mean that the fact is not jurisdictional (see the examples given in Pallas Newco at [60]). Second, as the examination of the earlier case law above demonstrates, the exercise of judgment and the potential for inconvenience is no greater than that already present in any challenge to the reasonableness of a determining authority's conclusion that an EIS is not required because the activity is not likely to significantly affect the environment. And, third, "remedies on judicial review are discretionary and may be refused" (Timbarra at [93]). 300 I therefore find that s 112(1) of the EPAA gives rise to a jurisdictional fact that the Court must determine for itself on all the available evidence, including the expert evidence tendered by the parties, whether or not the pilot program is likely to significantly affect the environment.

SHCAG's submissions

1. SHCAG submitted that the requirements of s 111 are pivotal to a proper working of Pt 5 of the EPA Act per Cripps J in F Hannan Pty Ltd v Electricity Commission of New South Wales (1983) 51 LGRA 353 at 366. The requirement to undertake environmental assessment is a key means of achieving ecologically sustainable development (ESD) principles per Bentley v BGP Properties Pty Ltd [2006] NSWLEC 34; (2006) 145 LGERA 234 at [67] and Minister for Planning v Gray [2006] NSWLEC 720; (2006) 152 LGERA 258 at [116]-[117]. The opening words underline its importance. There are two duties, one to examine and one to take matters affecting or likely to affect the environment into account as held by Pepper J in Fullerton Cove at [142]. "Examine" reflects the recognition by Parliament of the central importance of s 111 in the scheme of the EPA Act and the obligation in that section. At [144] Pepper J considered the duty was analogous to the duty to inquire as found in Prasad. A decision-maker is obliged to seek out and obtain relevant information if that information is readily available.
2. The Minister's delegate failed to examine and/or take into account to the fullest extent possible the impact of the access tracks because their location was unknown, the economic and social impacts as can be seen from the various affidavits of the landowners in the proceedings and the cumulative impacts of the REF 1 and REF 2 approved drilling programs, together with 45 possible future boreholes.

Access tracks

1. The environmental impacts of the means of access from the public highway across private land to the 25 boreholes was not assessed by the Minister. First, access to private land is provided for in the Mining Act and an access agreement should have been obtained under that Act prior to preparing the REF 3. An email to the solicitor for SHCAG dated 3 March 2014 by the delegate was relied on. It stated (p 118, EB vol 1): In my role as the delegated officer for the determination of a matter in accordance with Part 5 of the Environmental Planning and Assessment Act, 1979, it is acknowledged that a degree of certainty is necessary…I have expressed previously, a reasonable degree of certainty can only arise when the full extent of the drilling program and related activities including construction of roads etc. are able to be identified for individual properties. Any explorer, submitting an application for an activity approval is on notice that the environmental assessment of the planned program will need to include an assessment of the impacts of the drilling program and all related prospecting activities. To obtain a comprehensive environmental assessment would necessarily involve, I feel, a site inspection of the locations of the drill holes and the means to get to those locations from an access point off a public road. Accordingly, the application for the more intensive drilling campaigns characterised as Category 3 will need to address the environmental impacts for the preferred drilling sites, routes of access to those locations across the effected lands and any significant features of the environment that may be impacted by the proposal. These matters will need to be addressed in the Review of Environmental Factors (REF) that accompanies the application for approval of a drilling program. (sic) Generally speaking, it would appear to be problematic for any prospector to conduct its environmental assessment without access and without knowledge of the access agreements agreed with the landholder. (emphasis added by SHCAG)
2. First, s 252 of the Mining Act expressly provides for a person to obtain a permit from the Minister to enter land to undertake assessment without obtaining a prior access agreement. Hume Coal could have obtained such a permit and gained access to the land and identified potential access routes while preparing the REF 3. This section may also extend to the Minister's delegate or officers (TS 288/11-12). Following approval of an exploration licence by the Minister there is no reason why a subsequent access agreement could not be negotiated or determined giving the exploration company access over the private land for the approved activities: see Brown v Coal Mines Australia Pty Ltd [2010] NSWSC 143; (2010) 76 NSWLR 473 at [118].
3. Second, the REF 3 proceeds on the false assumption that existing access tracks on the farms would be used thus minimising the environmental harm otherwise caused by the creation of new access tracks. That this was false should have been known by the Minister and Hume Coal because SHCAG made it clear in its written objections to the REF 3 that internal access roads and tracks on the farms were claimed by the landowners to be significant improvements for the purpose of s 31 of the Mining Act and consent would not be given by the landowners for their use. The objections also identified that the stock-proof fences and agricultural land constitute significant improvements and consent would not be given to Hume Coal to locate access tracks on those areas. Consequently alternative access routes would be required.
4. Those issues having been raised by the objectors to the activity, the Minister was under a legal obligation to inquire further into the locations, and impacts, of the proposed access routes, and to obtain the necessary information so as to enable him to discharge his obligations under s 111 of the EPA Act, namely to examine "all matters likely to affect the environment".
5. The Department's Assessment Report, as set out above, informed by the REF and a limited site inspection of some of the proposed drill locations from the public highway only, was a wholly inadequate examination into the impacts of the access tracks in light of the issues raised by the landowners and the overall obligation to "examine" imposed on the Minister by s 111 of the EPA Act. The Assessment Report is no more than an uncritical acceptance of the assumptions made by Hume Coal in the REF 3, which were the subject of fierce dispute by the landowners and SHCAG, as indicated in SHCAG's submissions to the Minister.
6. Third, SHCAG does not seek too high a level of particularity as to the location of the access tracks. The Minister never received any information in the REF 3, general or otherwise, as to the location of the proposed access tracks, other than to say that the location would be agreed in an access agreement to be formalised in the future. For example, no "corridors" or alternative routes were posited. No indication was given as to when creek crossings would be required, or where gravel tracks might be necessary. This is relevant because in Garrett v Freeman (No 4) [2007] NSWLEC 389 at [246]-[247] Lloyd J held that a REF that did not identify, inter alia, the location of roads, material to be used or how the works are to be undertaken did not comply with the requirements of s 111 of the EPA Act.
7. Fourth, the Minister's submission that it is sufficient for the "method of precisely locating" the tracks to be disclosed in the environmental assessment and, presumably, the detail of location and construction to be determined subsequently is contrary to authority: see Newcastle & Hunter Valley Speleological Society Inc v Upper Hunter Shire Council and Stoneco Pty Limited [2010] NSWLEC 48 at [83] and [85]-[86].
8. In Bailey v Forestry Commission of New South Wales (1989) 67 LGRA 200 the Court found there was a failure to assess environmental impacts in the approval of a logging operation which deferred to the contractor a number of operational decisions such as the trees to be logged, which areas were too steep to be logged, inter alia. That case supports a finding here that the Minister failed to properly assess the activity in granting approval as the access left to the future consideration of Hume Coal and the landowners the location, method of construction and rehabilitation of the access tracks. There was no proper consideration, in the Parramatta City Council v Hale (1982) 47 LGRA 319 sense, of the environmental impacts of the activity as a whole.

Economic and social impacts not addressed

1. In addition, the Minister's delegate erred because he failed to examine or give consideration to the economic and social impacts of the activity on the affected landowners and the local community. These impacts were also matters he was obliged to examine because community responses regarding the project form part of the public interest.
2. It is true that "a fear or concern without rational or justified foundation is not a matter which, by itself, can be considered as an amenity or social impact": Bulga Milbrodale Progress Association Inc v Minister for Planning and Infrastructure [2013] NSWLEC 48, (2013) 194 LGERA 347 at [63]. However, the landowners' affidavit evidence does not fall into that category. Their evidence as to the likely direct economic and social consequences of approval was based on experience and costs of dealing with Hume Coal in arbitrations. Their evidence is more than an expression of subjective fear and concern. It forms part of the public interest. The landowners' affidavits identified a number of justified concerns and the social and economic impacts of the activities on them and their properties.
3. Dr Roche's evidence demonstrated that there would be a reduction in the recreational value of the locality as a result of drilling on his parents' property and an adverse effect on a property and eventing course which has social significance for the wider eventing community as well as the local community. There could be no eventing competition or training when earthworks or drilling or rehabilitation was occurring on the property due to safety issues. If only one hole is drilled it will impact upon the ability of the Roche property to operate as an equestrian eventing venue. Competitors will not continue to come to the Roche property if the footing is uneven or disturbed.
4. The evidence of the landowners adduced in these proceedings would have been available to the Minister at the time of his determination had he made the necessary inquiries as required by s 111 of the EPA Act.
5. The ESG2 guidelines (exhibit D) require that an economic impact that results in a direct cost to the community or individuals must be assessed. Direct costs identified in objections to the proposed activity included the costs to landowners of resisting Hume Coal's access to their land under the Mining Act.
6. The objection by SHCAG addressed to the Minister and Hume Coal identified that the Roche property was an "eventing course for training and competition horse events". Further on, the document said this: "horses undertake training for eventing across the entire property. Access tracks will cause significant issues for eventing courses, both in terms of safety to horse and rider and insofar as the Roches running their business in providing these courses to equestrians".
7. It is obvious that material was available to the Minister's delegate as to the social and economic impacts of drilling on the Roche property, if only the Minister's delegate had made an attempt to obtain it. The delegate could have sought a site visit of the property to understand its operation and the potential impacts on it; he could have written to the Roches seeking further information. He could have requested that Hume Coal undertake further investigations. But he made no attempt to obtain the information.
8. The REF 3 did not grapple with the argument raised by the landowners and SHCAG that the arbitration process for access agreements would be burdensome. Whilst the REF 3 contains a section on direct and indirect impacts on landholders (p 394, EB vol 2) the REF 3 states that some landholders were surveyed. Those landholders were not the landholders directly impacted by the activity. The argument is not addressed at all.
9. Likewise, the Assessment Report simply ignored this argument. The matter having been raised by the landowners and SHCAG in its submissions to the Minister, it was once again incumbent on the Minister to undertake an investigation and inquiry as to what the social and economic costs of the phase 3 exploration program would be, including the costs of and time spent on inevitable negotiations, arbitrations and appeals, and the consequent impacts on the affected landowners. The Minister's summary of community submissions on this very point states "Outside the scope of this review - no further action" (p 541 at row 5, EB vol 2) in breach of s 111 of the EPA Act.

Respondents' submissions

1. This ground was addressed by the Minister whose submissions were adopted by Hume Coal. The Minister submitted that there was a single duty in s 111, not two separate duties contrary to the finding in Fullerton Cove at [142]. In any event whether a single or double duty applies the section was complied with by the Minister. The Minister admitted that the Minister's delegate was required by s 111 to examine and take into account the locations and impacts of the proposed access routes required to access the proposed new drilling sites from the public highway: at par 7(a)(i) of the Minister's response to summons filed 15 January 2015. The impacts of the tracks depend on the location of the boreholes to a large degree. The Respondents accept that the natural consequences of the "activity" to be assessed under s 111 include the manner of access to the proposed boreholes. The level of particularity at which such impacts must be assessed is in issue. Section 111 is satisfied if the general location of the access tracks is known and the method of precisely locating the tracks is disclosed as it was in the REF 3 at section 2.4. This was examined and taken into account in the Assessment Report at section 4.3 and at section 4.5. That Report stated that after completion of track construction the area will be reinstated to the original condition. SHCAG is wrong to equate precise geographical location with adequate impact assessment. Impacts were considered in relation to the use of existing tracks and in the event of new tracks.
2. There is no statutory basis for SHCAG's submissions stating that processes under the Mining Act should be engaged in first to enable access to land and precise identification of access routes. Section 111 of the EPA Act provides no basis for such a construction. The approval processes under the EPA Act are freestanding from any process under the Mining Act. The EPA Act processes in Pt 5, and other parts of the EPA Act, do not provide lawful access to land not owned by a proponent. The implication of the submissions of SHCAG is that a precondition to assessment under the EPA Act must be the conclusion of access arrangements in Pt 8 of the Mining Act. The chronology shows these can be protracted where parties do not agree as in this case. Physical access to land which is the only means by which the access routes could be identified to the extent SHCAG submits is required is not a prerequisite to the valid grant of approval under the EPA Act. Section 252 of the Mining Act is one of a number of potential ways of accessing private land. There is no statutory requirement that any particular statutory path be taken or adopted. Reliance on s 252 relies on an assumption that access to land is a prerequisite to the valid grant of approval under the EPA Act and there is no basis for such an assumption.
3. Further SHCAG has not demonstrated that any greater specificity of access tracks was a mandatory relevant consideration. Further entry onto land pursuant to a s 252 Mining Act permit would not enable the location of access routes to be identified with precision. The location of access routes is subordinate to and in large part constrained by the location of boreholes and not the other way around. The access routes serve no purpose other than to provide access to boreholes.
4. The degree of particularity required in relation to access tracks, inter alia, by SHCAG is not warranted by the statutory scheme: see Arnold v Minister Administering the Water Management Act [2014] NSWCA 386 at [79]-[81] and [84]. As the REF 3 states, where access tracks are required they would be put in by the method described for locating and using access arrangements with implementation described and particular management steps and regime. Bailey is distinguishable on the facts as the circumstances of that case are quite different to this case. Nothing before the decision-maker in this case would trigger concern that the access tracks could not be located appropriately.
5. Nothing before the Minister's delegate suggested that any of the affected properties were so environmentally constrained that access tracks of the type envisaged would or could result in adverse environmental effects.

Economic and social effects

1. SHCAG must establish that, as a matter of statutory construction, those social and economic impacts it identifies are mandatory relevant considerations at that level of particularity. The observations by Gleeson CJ and McHugh J in Foster v Minister for Customs and Justice [2000] HCA 38; (2000) 200 CLR 442 at [23] concerning the level of particularity required are equally applicable to the present circumstances. "Social and economic impacts on affected landowners" may be one thing, the costs of "resisting access agreements" at arbitration and in court is quite another. Apart from anything else, the level of particularity at which SHCAG seeks to describe the alleged mandatory relevant consideration is untenable, finding no statutory basis.
2. Section 111 of the EPA Act requires consideration of all matters "affecting or likely to affect the environment by reason of [the] activity". Just as the requirement to take those matters into account "to the fullest extent possible" is impliedly limited by a requirement of reasonableness, the identity of the matters themselves must be impliedly limited. It would not be a sensible construction of the statute to require a determining authority to take into account "all matters at every possible level of particularity, however fine-grained". The more fine-grained expressions of relevant matters may be permissible considerations, but they are not necessarily mandatory considerations on a proper construction of the statute.
3. The matters that must be examined and taken into account are to be identified by the ordinary processes of statutory construction. To the extent that the matters are not expressed in the statute, they are to be discerned by "implication from the subject-matter, scope and purpose of the Act": Minister for Aboriginal Affairs v Peko-Wallsend Limited [1986] HCA 40; (1986) 162 CLR 24 at 40. Fatally to SHCAG's case on grounds 1 and 2, to the extent that matters are not expressed in the statute to be mandatory relevant considerations, "the court will not find that the decision-maker is bound to take a particular matter into account unless an implication that he is bound to do so is to be found in the subject-matter, scope and purpose of the Act": Peko-Wallsend at 40.
4. On SHCAG's own submissions, the alleged obligation to take this particular matter into account comes not from any statutory basis, but from the ESG2 guidelines, and from the circumstance that the landowners and SHCAG raised the consideration generally in their objections. Neither of those circumstances would give rise to an obligation to take the matter, at the level of particularity in which it is now expressed, into account.
5. SHCAG ultimately reveals the true complaint that it makes in the following terms: "The REF did not grapple with this evidence and argument raised by the landowners and the plaintiff. Whilst the REF [3] contains a section on direct and indirect impacts on land holders, the argument is not addressed at all". SHCAG does not, however, explain the source of any statutory duty to take into account "evidence and argument" as distinct from "matters" within the meaning of s 111(1).
6. Assuming that Fullerton Cove is correct in relation to a separate duty to inquire, SHCAG has failed to identify any material which triggered the alleged Prasad like duty to inquire. It is not sufficient to submit the information in the affidavit material of the landowners would have been available to the Minister's delegate had he made necessary inquiries. A matter must be obvious from the material before the delegate to trigger the obligation to inquire per Gilbank v Bloore (No 2) [2012] NSWLEC 273 at [82]. Such a duty is not at large but applies only to obvious inquiries about critical facts, centrally relevant to the decision to be made, the existence of which is easily ascertained: see Prasad v Minister for Immigration and Ethnic Affairs (1985) 6 FCR 155 at 170, Minister for Immigration and Citizenship v SZGUR [2011] HCA 1; (2011) 241 CLR 594 at [78]. In Minister for Immigration and Citizenship v SZIAI [2009] HCA 39, (2009) 259 ALR 429 at [26] the High Court (French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ) held that a tribunal's failure to make inquiries was not a jurisdictional error as there was nothing to indicate that further inquiry could have yielded a useful result. This is the current description as a matter of law of the Prasad like duty.
7. Secondly, there was nothing in the material before the delegate to trigger any "obvious" inquiry, contrary to SHCAG's submission. SHCAG relies on two pieces of information as the triggers: first, a statement that the Roche property was an "eventing course for training and competition horse events"; and second, a statement that "horses undertake training for eventing across the entire property. Access tracks will cause significant issues for eventing courses, both in terms of safety to horse and rider and insofar as the Roches running their business in providing these courses to equestrians". Note that the so-called "trigger" was, in express terms, confined to a concern about "access tracks". On SHCAG's own case, nothing in the material before the Minister's delegate triggered any obvious inquiry about the impacts of drilling boreholes on the eventing activities on the Roche property. As for the access tracks, there was no obvious inquiry about a critical fact, because the Minister's delegate considered that access tracks would be negotiated with landowners, in circumstances in which a large property was involved there was no good reason for the Minister's delegate to think that acceptable access tracks were not possible.

No breach of s 111 by Minister's delegate

1. The first two grounds of judicial review relied on by SHCAG concern the duty placed on the Minister by s 111 of the EPA Act, informed by the finding in Fullerton Cove at [142] that the duty has two parts: one to examine (ground 1) and one to take into account (ground 2) all matters affecting or likely to affect the environment. The submissions of SHCAG concerning the importance of s 111 in the scheme for environmental assessment in Pt 5 should all be accepted given the express wording of the section and are supported by Fullerton Cove at [141] and numerous earlier cases such as Bentley v BGP Properties and Gray.
2. The broad wording of s 111, "all matters affecting or likely to affect the environment by reason of that activity", means that whether a particular matter is a mandatory relevant consideration must be inferred from the statutory scheme. Whether in the particular circumstances of this case there has been a relevant failure to comply with s 111 by the Minister's delegate must be considered. An overarching consideration, as SHCAG accepts, is that the application of s 111 necessarily involves a standard of reasonableness and practicality, as the Minister submitted: see Guthega Development Pty Ltd v Minister Administering the National Parks and Wildlife Act (NSW) 1974 (1986) 7 NSWLR 353 at 366 and Oshlack v Rous Water (No 2) [2012] NSWLEC 111; (2012) 189 LGERA 243 at [65]-[66]. Fullerton Cove at [141] is to similar effect including in relation to the duty to examine/the Prasad like duty to inquire at [149].
3. It is necessary in light of the evidence before me to consider the material before the Minister's delegate to determine whether there was any relevant failure to examine and take into account the matters identified by SHCAG's submissions. Importantly, the relevant factual context informs my consideration, here the nature and duration of the activity of accessing land and drilling the proposed 25 boreholes across the eight properties considered in the REF 3 informed by the conditions in Authorisation 349. Under the terms of the approval both instruments are binding on Hume Coal when undertaking the work and include ameliorative measures. Relying on Speleological Society SHCAG submitted that ameliorative measures could not be considered by the Minister's delegate. At [83] Preston J stated that: … Ameliorative measures not proposed as part of the development application, but which are imposed afterwards, as conditions of consent or restrictions in construction certificates, are not able to be considered in answering the inquiry as to likely impact. This is because the inquiry required by s 78A(8)(b) [of the EPA Act] focuses on the development and its likely impact before the determination of the application and not afterwards …
4. That case was a merit appeal considering whether development consent ought be granted under Pt 4 of the EPA Act. As the Minister submitted, Preston J was determining a jurisdictional fact of whether the development in question was likely to significantly affect threatened species in an EEC at the time of the decision. In that respect the statutory context is different to s 111, which contemplates consideration of matters "likely" to affect the environment at a future point in time. The different drafting in Pt 4 compared to Pt 5 of the EPA Act does not need to be explored for current purposes. I agree that by parity of reasoning the case supports the Minister's submission that ameliorative measures proposed as part of the phase 3 program for which approval is sought is part of the "activity" proposed by Hume Coal and can be taken into account in any assessment of environmental impact by the Minister's delegate. This was also the approach taken in Parks and Playgrounds Inc v Newcastle City Council [2010] NSWLEC 231; (2010) 179 LGERA 346 at [134] and Fullerton Cove at [323] referring expressly to Speleological Society.
5. The material before the Minister's delegate included that contained in volumes 4 and 5 (exhibit 1/1A) of the Evidence Book and the relevant parts have been extracted or summarised above in some detail. The material was extensive as identified in relation to the Assessment Report at par 28 and the REF 3 at par 30-49.
6. The REF 3 refers to serial drilling of boreholes one at a time (see par 40), the length of time to drill each hole being about one month (see par 36) with rehabilitation commencing as soon as possible after drilling has concluded (see par 37). Drilling activities will take up to four weeks to complete, followed by rehabilitation activities as required. The conservative approach taken in the AIS is that the entire drill area would not be available for 12 months (see par 44, 48). Section 5.1 of the Assessment Report refers to a commitment to returning land to full agricultural integrity within 12 months (see par 28). No roads are proposed. The REF 3 provides that access tracks which will require gravel to be laid may be required (see par 33). Their extent depends on how much existing tracks can be used. The REF 3 refers to the selection of drill sites comprising an area with a 100 metre radius (see par 35). These locations were shown before me in the maps in exhibit 4. The activity has inbuilt flexibility which is constrained by the conditions of Authorisation 349 so as to minimise environmental harm (condition 9), minimise vegetation clearance (condition 17), use existing tracks in preference to constructing new tracks (condition 23) and restrict the use of unsealed tracks during wet weather (condition 24). Conditions 38-41 specify the obligation to rehabilitate all disturbed areas, including that disturbed wetland crossings are to be rehabilitated so that the natural flow of water is unimpeded and bank stability is maintained to prevent erosion. The areas identified by SHCAG of access tracks, cumulative impact and social and economic impacts are referred to in the REF 3. The Assessment Report also refers to these topics and these will be discussed in more detail below.
7. Given my earlier ruling that Dr Davies' evidence is relevant to s 112 not s 111 there is no expert evidence before me directed to whether there was a failure to examine and take into account a matter in relation to s 111. The evidence of other experts was adduced in relation to the s 112 ground of appeal.

Access tracks

1. An important part of SHCAG's case is the alleged failure of the Minister to assess the potential impact of the route of any actual access tracks to the 25 boreholes the subject of the phase 3 approval. The precise path of any track to a particular borehole and its impact was not considered in the REF 3 and therefore the Assessment Report to the Minister's delegate. The Minister accepted in his response to the summons that the assessment of locations and impacts of access tracks was relevant to the obligation under s 111. The Minister's primary submission is that SHCAG has not demonstrated that greater specificity of the access tracks than appears already in the REF 3 and the Assessment Report was a mandatory relevant consideration for the Minister's delegate. At issue therefore is whether greater particularity in the location of access tracks was required as a mandatory relevant consideration under the statutory scheme in the EPA Act in order for assessment under s 111 to occur lawfully.
2. Section 2.9 of the REF 3 details the process for access arrangements. Access arrangements between landholders and Hume Coal are required to be negotiated prior to accessing any private land for exploration drilling activities (see par 33).
3. As already flagged above in par 11 Hume Coal could not enter private land it did not own without the agreement of the landowner when preparing the REF 3 for the Pt 5 assessment process. It was not therefore able to ascertain the precise routes of any new access tracks. The first aspect to consider is the statutory scheme in the EPA Act. The EPA Act does not provide a legal means of access to private land in these circumstances. As a matter of course the regulatory scheme under the EPA Act cannot provide the means for determining access routes to the level of particularity argued for by SHCAG in the absence of agreement of a landholder. That there is none suggests these could not be a mandatory relevant consideration for the Minister if the EPA Act alone is considered.
4. The only legal means by which access to private land can be obtained for exploration activities by Hume Coal is under a particular part of the Mining Act. The Respondents correctly submitted that the phase 3 program approved under condition 2 of Authorisation 349 for the drilling of 25 boreholes does not give a right of access to the land upon which prospecting activities are to be undertaken. Access to private land is addressed in the Mining Act by the access regime in Pt 8 Div 2 (Access arrangements for prospecting titles). This part of the Mining Act has been expressly made by the NSW Parliament to facilitate access to private land not owned by a prospector. Part 8 Div 2 enables the holder of a prospecting title to make arrangements to access private land and carry out activities. Sections of Pt 3 (Exploration licences) and Pt 8 of the Mining Act are extracted above at par 15. Section 31 in Pt 3 states that the holder of an exploration licence may not exercise rights under a licence over the surface of land within a prescribed distance of a dwelling house or garden or on land on which a significant (non-mining) improvement is located unless the written consent of the owner is provided. It is beyond the scope of these proceedings to determine what significant improvements within the definition in the Mining Act exist on the lands over which the phase 3 program has been granted.
5. The provisions of Pt 8 Div 2 of the Mining Act extracted above provide that a holder of a prospecting title must not carry out prospecting on land without an access agreement or arrangement (s 140). The numerous matters which can be included in such an arrangement are specified in s 141(1). A holder of a prospecting title gives written notice to a landholder of an intention to obtain an access arrangement. Sections provide for arbitration to occur (s 143) and referral to this Court where a party is not satisfied with the determination of an arbitrator (s 155). The affidavit evidence of Mr Pollicina, and Mr and Mrs Alexander refer to current protracted arbitration processes being undertaken by them and Hume Coal under Pt 8 Div 2 in relation to the phase 3 approval and identifies their views of how they are impacted in terms of the time and money spent (par 89). Mr and Mrs Martin and Hume Coal are yet to agree on an arbitrator. SHCAG's submission to the Minister dated 1 August 2014 identified that five of the six landowners are in dispute with Hume Coal regarding land access.
6. It appears that to date the two schemes in the EPA Act and the Mining Act have operated separately except perhaps in relation to permits issued under s 252 of the Mining Act. The Court does not have before it any information about the operation of that section. In the absence of any statutory indication suggesting otherwise the separate operation of statutes which have different purposes is to be expected. That approach is reflected in the statement by the Department in appendix I to the Assessment Report that access arrangements, specifically the operation of s 31 of the Mining Act, were outside the EPA Act assessment process.
7. A consequence of SHCAG's submissions if accepted is that physical access to private land where boreholes are proposed to be drilled is necessary before any assessment leading up to consideration of environmental impacts by the Minister can occur under Pt 5 of the EPA Act. In the absence of landholder agreement to allow access that necessarily requires a process under Pt 8 Div 2 of the Mining Act to be followed first as that is the statutory means for gaining access for exploration purposes to private property where a landholder does not consent. As the Respondent submitted a major hurdle to that construction of the requirement in s 111 of the EPA Act is that there is no express statutory provision so stating in either the EPA Act or the Mining Act. Nor is there any statutory construction basis to imply such a statutory scheme. One result of SHCAG's approach would seem to be that two access arrangement processes would be necessary under Pt 8 Div 2. One would be for the purpose of determining access routes (assuming that could be done in such a process which is debateable when the terms of Pt 8 are considered) and one at a later stage to negotiate and ultimately finalise access arrangements for the carrying out of prospecting activities if approval has been granted for these.
8. Brown v Coal Mines Australia Pty Ltd at [118] was cited by SHCAG as supporting the approach of having more than one access arrangement but the passage relied on does not do so. That case was addressing quite different circumstances and did not result in more than one access agreement being reached. Nor was SCHAG's approach endorsed by Schmidt J. Such an approach is not practicable for either a proponent or a landholder given the potentially protracted nature of such proceedings where access is strongly opposed. For example, according to Mr Alexander's affidavit the current Pt 2 Div 8 access arrangement process commenced in January 2013 and is ongoing. The same process for Pollicina and Fesen Pty Ltd also commenced in January 2013, with the first arbitration hearing in October 2013 according to Mr Pollicina's affidavit. As a matter of statutory construction and practicality, I do not accept SHCAG's submission that a Pt 8 Div 2 Mining Act process had to be undertaken first before the Pt 5 EPA Act assessment process.
9. Section 252 in Pt 12 (Powers of entry and inspection) of the Mining Act refers to the granting of a permit by the Minister to enable a person to enter land so as to enable the person to undertake an assessment for the purposes of the EPA Act and was also relied on by SHCAG. That section is not an alternative to the detailed access regime specified in Pt 8 Div 2 of the Mining Act as can be seen, for example, by the topics which can be the subject of an access arrangement in s 141 such as the duration of any arrangement, conditions of access and compensation payable. The purpose of the access arrangements under Pt 8 Div 2 is to enable prospecting to occur, a different outcome to that provided for in s 252 under Pt 12 Div 2. The statutory schemes in the EPA Act and the Mining Act if viewed jointly (for which approach there is no explicit statutory basis) do not suggest that the precise access routes to a proposed borehole must be known in order for s 111 to be complied with by the Minister on the facts of this case.
10. Turning to the particular facts of this case as to whether there was an examination and taking into account of access track impacts by the Minister's delegate, as identified in the extensive summary of evidence at par 18-49, the issue of access is discussed in the REF 3 and the Assessment Report. The Assessment Report, partially extracted above at par 28, identifies in section 4.2 that there will be improvements to existing access tracks and construction of minor additional tracks. At section 4.3 a preference for using existing access tracks, which will be upgraded as required in negotiation with the landowner, is identified. New tracks are to be negotiated with landowners and limited to paddocks and previously disturbed areas where no tree removal is required. Creek crossings will be avoided where these could have undue impacts. Topsoil disturbance will be kept at a minimum. The Assessment Report identifies a number of rehabilitation activities concerning access tracks at section 4.5. Such activities are undertaken in accordance with each landowner's requirements, but can include the ripping, seeding and fertilising of temporary access tracks and associated disturbed areas following completion of drilling, reinstating the area to its original condition following completion of track construction and applying seed and fertiliser to all ground in the vicinity of the access track where surface grasses have been removed or bare patches are evident. Reference is also made to the need for Hume Coal to resolve land access issues in accordance with the Mining Act when undertaking land access negotiations and arbitration (see section 4.12).
11. The material before the Minister's delegate included SHCAG's submission to Mr Barry, the Director Environment Sustainability at the Department, dated 24 April 2014, which attached a landholder property assessment partially extracted above in par 23. This document identified claim significant improvements, percentage of the property affected by drilling activities and the agricultural activities engaged in by the landowners, including beef and lucerne crop (Pollicina and Fesen properties), truffles and lucerne crop (Martin property) and veal and oats crop (Alexander property). The Roche property is identified as an eventing course for training and competition horse events and has a lucerne crop across a paddock. SHCAG's submission to Dr Blackmore, Director Environment Sustainability at the Department, dated 1 August 2014, attached an updated landholder property assessment (see par 25). SHCAG's letter to the Minister dated 1 August 2014 identifying "key issues" was also before the Minister's delegate (see par 24). The over the fence site inspection of a departmental officer (appendix K to Assessment Report) confirmed the nature of the land use on all the affected properties as "generally … cleared agricultural land consisting predominantly of perennial pasture systems".
12. In addition to that which was summarised in the Assessment Report, the REF 3 identified site selection principles aimed at avoiding impact. One such principle states that the drill site will be located near existing roads and tracks where practical. Access will be via public roads and internal property roads and tracks. New gates may be installed in fences to minimise access distance or impacts. In some locations, where it is deemed suitable, vehicles will drive across grassed areas. Some surface disturbance may be required for the construction and maintenance of new access tracks. The location of new access tracks will be determined by the prevailing conditions, landholder preferences, and will be discussed with the landholder (see par 33).
13. A procedure for obtaining land access arrangements, which will determine the precise location of the drill sites and access tracks and identifies protocols to, inter alia, limit damage to the land is described. Landholders have the right to negotiate property management issues and other issues such as gate and fence locations. All traffic is to be confined to access tracks as far as practical. In the case of access through open spaces and across paddocks care will be taken to ensure minimal damage, for instance, avoiding the use of paddocks following heavy rainfall. The REF 3 refers to the use of gravel for new access tracks, with cut and fill earthworks only where necessary to maintain stability. Any gravel used at the drilling sites and access tracks will be removed upon completion, unless requested by the landholder. Once access agreements are negotiated ecologists and heritage consultants will inspect the drill compound area, and existing and new access tracks (see par 33-34).
14. The impacts from boreholes and access tracks are short term and are not considered significant. Mitigation measures associated with access tracks include minimising the use of access tracks during or following rainfall, examining the existing and new sites by ecologists to delineate sensitive ecological features and avoid impacts, and imposition of a 40 km/h speed limit on all access tracks or slower if requested by the landholder. Rehabilitation works are to be commenced as soon as practical following completion of works and new tracks are to be properly constructed, stable and drainage installed. There are also surface water and air quality environmental management measures set out in the REF 3 (see par 36-38).
15. The AIS, being appendix E to the REF 3, includes an agricultural risk ranking of, inter alia, the construction of access tracks. The assessment finds that it is unlikely that the drilling program will result in more than minor damage and/or short-term impact to agricultural resources and industries. Reference is also made to the rehabilitation works of access tracks including reinstating the area following completion of track construction and applying seed and fertiliser to the ground in the vicinity of the access track (see par 46-47). The access to private land envisaged in the REF 3 at a general level is on land that appears as cleared grazing or cropping land on all of the properties. The REF 3 identifies in some detail the arrangements able to be made under Pt 8 Div 2 of the Mining Act.
16. SHCAG submitted that the Minister's delegate was not told in the REF 3 that the construction of access tracks is also likely to involve the need for significant remediation, a fact admitted by the Project Manager employed by Hume Coal in Hume Coal Pty Ltd v Alexander (No 3) [2013] NSWLEC 58; (2013) 194 LGERA 319 at [68]. I note that paragraph dealt with a different access option than I understand is proposed by Hume Coal in this case so that observation is not material in this matter. The rehabilitation requirements imposed on Hume Coal are specified in the REF 3 and conditions 38-41 of Authorisation 349.
17. SHCAG relied on Garrett v Freeman (No 4) at [246]-[247] but those paragraphs do not state that the absence of the location of roads in a REF was a breach of s 111 of the EPA Act. The paragraphs do discuss why a three page document was inadequate as a REF in the circumstances of that criminal prosecution. In any event the adequacy of a REF must always depend on the particular circumstances of the case before the Minister's delegate.
18. Bailey considered a forestry operation approval in which the trial judge found there was a complete absence of assessment of matters fundamental to a forestry operation which were left entirely at the discretion of the logging contractor. That is not analogous to the circumstances here.
19. Additional matters should be referred to. Hume Coal is correct in stating that the essence of SHCAG's argument is that the approval for the phase 3 program consisting of 25 boreholes under the EPA Act cannot have any flexibility as to where and how it is carried out. Given the complexity and range of activities the subject of Pt 5 assessment, that cannot be an appropriate approach as a general proposition and also in relation to the specific circumstances of this case. That level of certainty is not explicitly required by the statutory scheme and is not an approach supported by any case law. A further difficulty with having precise access tracks determined as a preliminary matter which the Minister identified was that this would not allow any flexibility in delivery of the borehole program subsequently, an undesirable outcome if it transpired that impact could be reduced by a variation to the location of a borehole.
20. One matter should be clarified in relation to statements by Hume Coal that an access road would require further consent from the Minister. This was interpreted in SHCAG's closing submissions at par 45 as suggesting that separate consent was intended to be sought by Hume Coal in relation to access. Hume Coal does not consider it needs to build an access road to any of the boreholes, so that no separate approval from the Minister will be necessary. Access tracks were intended to be considered in the REF 3 approval process. The email dated 3 March 2014 from the Minister's delegate set out at par 123 refers to Category 3 intensive drilling programs and highlights the importance of identifying related activities such as the construction of roads.
21. Applying my findings in this section to the particular arguments of SHCAG to the extent they have not already been dealt with, that there is no reason in law why Hume Coal could not obtain an access arrangement prior to preparing the REF 3, there is no statutory obligation under the EPA Act requiring Hume Coal to obtain an access arrangement under the Mining Act in these circumstances. Hume Coal did not leapfrog any legal obligation.
22. The REF 3 and condition 23(a) of Authorisation 349 require that existing roads and tracks are to be used in preference to new roads and tracks as a means of reducing environmental impact. SHCAG's letter to the Minister dated 1 August 2014 stated that five of the six landholders affected by the phase 3 program are in a dispute with Hume Coal due to significant improvements to their properties under s 31 of the Mining Act. SHCAG submitted that all existing access tracks and roads on the deponents' lands were significant improvements for the purposes of s 31 of the Mining Act and therefore not available to Hume Coal. The affidavits of the landowners in these proceedings and SHCAG's submissions emphasised that the use of existing tracks would be opposed in the access arrangement processes underway under the Mining Act because these were significant improvements. SHCAG submitted Hume Coal had an obligation to provide alternative access routes in the REF 3 which the Minister should have sought advice about before making a decision.
23. This is a chicken and egg argument because Hume Coal cannot provide the level of particularity contended for by SHCAG unless it obtains access under the Mining Act so that the Minister requesting further information would essentially require finalisation of an access arrangement process under the Mining Act or a permit under s 252 before the EPA Act process could be finalised (on the assumption that SHCAG's approach to the Pt 8 Div 2 process or s 252 in the Mining Act would be an appropriate vehicle for determining access tracks as a preliminary matter about which I have doubts). Given my finding above that there is no statutory basis for finding that there had to be access to the land before the Pt 5 assessment process under the EPA Act was carried out, this part of SHCAG's submissions is difficult to apply in the context of a challenge to a Pt 5 assessment whether under s 11 or s 112.
24. SHCAG's submission that there was insufficient detail provided in the REF 3 concerning access is not established when the material in the REF 3 is considered as a whole. The references referred to by SHCAG in its submissions were not the sum total of all the relevant material in the REF 3.
25. SHCAG has not established any failure by the Minister's delegate to examine and/or take into account potential environmental impacts concerning access tracks.

Cumulative impacts

1. Section 111 of the EPA Act does not refer to a cumulative impact assessment expressly. As the objects of the EPA Act include the protection of the environment and cumulative impact assessment is widely recognised as an aspect of environmental impact assessment I find that cumulative impact assessment is a mandatory relevant consideration under s 111 provided that an evidentiary basis exists for such a requirement per Gray at [122]-[123]. My finding above in par 119 in relation to the scope of "activity" for the purposes of s 110 in this case means SHCAG's submissions on the need for cumulative impact assessment is not accepted in relation to potential future drilling of unspecified additional boreholes.
2. SHCAG also submitted that cumulative impact assessment required that the impacts of the phase 1 and phase 2 programs be considered by the Minister or his delegate at the time approval was given for phase 3. I do not understand SHCAG's case in relation to phase 1 and phase 2 programs in that no evidence which related to ongoing impacts of those two phases of drilling was before the Court. In the absence of relevant evidence, SHCAG's submissions are assertions only. The locations of phase 1 and phase 2 drilling sites were not on the properties where the phase 3 sites are proposed so that what environmental impacts would need to be assessed on a cumulative basis is unclear.
3. In relation to the evidence, section 4.11 of the Assessment Report states that the exploration sites for the phase 1 and phase 2 programs have been progressively rehabilitated and the addition of the phase 3 program is not likely to lead to a significant cumulative impact on the biophysical environment. There is no evidence before me to refute that statement. Hume Coal's exploration program is described in the Assessment Report as the only known exploration program in the area. The Assessment Report lists a number of the amendments made by Hume Coal since its previous REF 3 was refused and states that these amendments are a satisfactory reduction in the scale and intensity of the activity such as to reduce potential cumulative impacts to a manageable level. Reductions in the number of drill rigs used and landowners affected are cited as examples for why the Department has more confidence the cumulative impacts are acceptable for the community and environment (see par 28).
4. The REF 3 identifies cumulative impacts of the phase 3 program as summarised and extracted at par 39-41 in relation to noise, dust, visual, water, traffic and ecological and archaeological impacts. The assessment of cumulative impacts includes reference to the phase 1 and 2 programs and the potential for any future additional exploration prior to or during mining. No private properties, other than the property owned by Hume Coal, have been subject to phase 1 or phase 2 drilling activities. Hume Coal has completed 136 of the approximately 300 exploration holes within Authorisation 349 (see par 41). The REF 3 identifies the amendments made since the original REF 3, such as reductions in the time period for the exploration activity from five to two years and the number of proposed boreholes from 90 to 25. The use of one drill rig at a time will address cumulative impacts of, inter alia, noise and traffic and drilling boreholes in close proximity to each other. The combined impact on the economy of the Southern Highlands is considered small and will be the subject of compensation as part of access arrangements (see par 39).
5. By inference the impact referred to by SHCAG may be the combined economic and social impacts of all the drilling undertaken by Hume Coal in the general area. That is difficult to consider in the absence of some evidence that drilling on different properties which has now been completed and presumably rehabilitated (a requirement of those exploration licences) has any ongoing social and economic impact relevant to a cumulative impact assessment for the phase 3 program. The wider community opposition to coal mining and coal seam gas in the southern highlands as identified in Mr Martin's affidavit dated 18 February 2015 is referred to in the REF 3 and the Assessment Report (see below at par 194-195).
6. As the Respondents submitted, there was no obligation on the Minister to consider a further 45 boreholes. The "activity" as described in the REF 3 is the drilling of up to 25 boreholes not a hypothetical 70 boreholes. Any future effects of further boreholes would not be "by reason" of the "activity". The facts in Hoxton Park Residents Action Group Inc v Liverpool City Council [2011] NSWCA 349; (2011) 81 NSWLR 638 which SHCAG relied on are not applicable to the facts of this case. There a bridge required to give effect to a development for which consent was sought was found to require consideration as part of the assessment of the development. The phase 3 drilling program in this case is a discrete activity.
7. SHCAG has not established that there was a failure by the Minister's delegate to examine and take into account cumulative impacts of the phase 1 and 2 programs.

Economic and social impacts

1. SHCAG submitted that the Minister's delegate failed to take into account certain economic and social impacts. This part of SHCAG's case relies on the findings in Fullerton Cove that the nature of the duty under s 111 includes separately something analogous to a Prasad like duty to inquire about environmental impacts. Although the Minister submitted that Pepper J incorrectly found there were two duties in s 111 I do not consider it is necessary to consider that issue and did not set out the Minister's argument on that matter. Her Honour's reasons appear thorough and do not suggest error, suggesting I should apply her Honour's finding in the interests of judicial comity. Further whether described as two duties or one duty with two aspects, the term "examine" appears explicitly in s 111 and must be given appropriate work to do. On the basis that a duty to examine and take into account includes a Prasad like duty to inquire, such a duty could not arise solely because additional material that may be relevant to a decision is prepared after the event here the affidavits of the landowners summarised above at par 87-109. The High Court in SZIAI held that such a duty is not at large but applies to critical facts centrally relevant to the decision to be made and the existence of which is easily ascertained, as the Respondents submitted. French CJ, Gummow, Hayne, Crennan, Keifel and Bell JJ stated at [25]-[26] (footnotes omitted): 25 Although decisions in the Federal Court concerned with a failure to make obvious inquiries have led to references to a "duty to inquire", that term is apt to direct consideration away from the question whether the decision which is under review is vitiated by jurisdictional error. The duty imposed upon the Tribunal by the Migration Act is a duty to review. It may be that a failure to make an obvious inquiry about a critical fact, the existence of which is easily ascertained, could, in some circumstances, supply a sufficient link to the outcome to constitute a failure to review. If so, such a failure could give rise to jurisdictional error by constructive failure to exercise jurisdiction. It may be that failure to make such an inquiry results in a decision being affected in some other way that manifests itself as jurisdictional error. It is not necessary to explore these questions of principle in this case. There are two reasons for that. 26 The first reason is that there was nothing on the record to indicate that any further inquiry by the Tribunal, directed to the authenticity of the certificates, could have yielded a useful result …
2. A further issue raised by the Respondents is that the level of particularity required in order to discharge the duty to examine/Prasad like duty to inquire in s 111 contended for by SHCAG is too onerous and not justified by the statutory scheme. The Minister relied Arnold at [79] and [84] and on the judgment of Gleeson CJ and McHugh J in Foster v Minister for Customs and Justice, where their Honours stated at [23]: The level of particularity with which a matter is identified for the purpose of applying this principle [failure to take into account a mandatory relevant consideration] may be significant. A related question arises where the failure complained of is not a complete failure to address a certain subject, but a failure to make some inquiry about facts said to be relevant to that subject. The argument in this Court does not assert a lack of procedural fairness, or unreasonableness to the degree that may constitute a ground for treating a decision as invalid … For the appellant's argument to succeed, there must be found in the legislation an implied obligation on the Minister to examine and investigate the contention at the level of particularity involved in the submission.
3. I conclude below that no relevant duty to inquire was triggered. It is therefore unnecessary to specifically address the Minister's argument on the level of particularity required in the context of this case.
4. Section 4.10 of the Assessment Report considers the social and economic impacts of the phase 3 program. Impacts and mitigation measures identified in the REF 3 are outlined. Direct impacts identified include loss of amenity, noise and dust emissions, inconvenience and temporary loss of land. Indirect impacts on landholders include the effect on the availability of community services, property valuation and tourism. There will be negligible impact on, inter alia, roads, power, education, and medical and social services. Perceived impacts and concerns are also identified. Economic impact of the exploration activity on agricultural viability has been assessed on the basis of a 90 borehole program as equating to less than $20,000 for the entire program or between $130 to $280 per borehole. The Assessment Report also states that the REF 3 has made a substantial attempt to identify and minimise likely socio-economic impacts, and that this assessment included the results of a Hume Coal initiated workshop. While some impacts can be minimised using practical measures, other psychological considerations, such as opposition to mining activities, are difficult to quantify and resolve (see par 28). Community submissions were summarised in appendix I including a submission from SHCAG dated 1 August 2014, as outlined above at par 29.
5. In the context of economic and landholder impacts, the REF 3 provides that the phase 3 program will occur on rural land involved in low intensity grazing and lifestyle properties. All but one of the properties will require access agreements. Direct impacts, such as those summarised in the Assessment Report, are identified. There are different aspects that cause landowners to be or feel impacted, such as the access arrangement process, having strangers accessing or working on their property, opposition to coal exploration or mining, and noise. Direct impacts can be mitigated to an extent, but the temporary loss of amenity and inconveniences fall under compensation provisions. Perceived impacts relate to impacts considered to be important to a landowner but may not be real, measureable or related to the actual exploration drilling. They include the incorrect perception that Hume Coal is drilling for coal seam gas. Hume Coal has experience addressing perceived impacts and has developed a series of information packages in response. It is not possible to completely satisfy landowner understanding of real impacts versus perceived impacts (see par 42).
6. The social and economic impact relied on by SHCAG in the summons is the costs to the landowners of opposing Hume Coal accessing their land necessitating their participation in the arbitration processes under the Mining Act at their own expense. This was identified in the Department's summary of SHCAG's submissions annexed to the Assessment Report as falling outside the scope of the EPA Act assessment (see par 29).
7. As the Respondents submitted, and I have set out earlier in this finding at par 161-166, the Mining Act provides a discrete statutory scheme for the negotiation of access to private land which operates separately from the EPA Act. Section 152 of the Mining Act specifies that landholders bear their own costs in such a process. This aspect of SHCAG's case cannot succeed given the express, and separate, statutory regime in the Mining Act for negotiating access to private land. There is no statutory basis for determining that costs incurred if exploration activities are opposed by a landowner under a separate statutory scheme are a mandatory relevant consideration under s 111 of the EPA Act in this case.
8. Alternatively, if the Minister was required to take into account the social and economic costs of the arbitrations and possible court appeals, then I accept the Minister's submission that the Minister's delegate did so sufficiently. The evidence establishes that the Minister's delegate ultimately formed the view that the issue of land access arbitration was "outside the scope" of his review, as reflected in the table of the Review of Community Submissions partially extracted in par 29. An inference arises from the documents before the Minister that this ultimate view was reached after active engagement with the issue and the landowners' views about the issue.
9. SHCAG's case was expanded at the hearing beyond the amended summons to include possible economic impacts on the Roche property and the area generally if horse eventing could not take place as referred to in Dr Roche's affidavits, and other economic impacts at other properties referred to in the affidavits of Mr Martin, Mr Alexander and Mr Pollicina. To succeed on this aspect of the case SHCAG must show that there was a Prasad like duty to inquire further arising from the material before the Minister's delegate.
10. As already identified above in par 169, there was material before the Minister's delegate from the landowners. SHCAG made a submission to Mr Barry, the Director Environment Sustainability at the Department, dated 24 April 2014 which included information on individual landholdings including the Roche property. This is identified above at par 23. The Roche property was identified as being required for horse eventing. Material about the land uses on the properties was before the Minister's delegate in SHCAG's land property assessment and community impacts were also considered. As identified in SHCAG's closing submissions at par 72 and as shown in the evidence, there was material before the Minister's delegate which identified that the various properties were generally cleared and used for grazing. SHCAG's submission to the Minister identified that the Roche property was used for horse eventing. SHCAG has not identified a critical fact about which an obvious inquiry should have been made which would give rise to a Prasad like duty of inquiry (SZIAI at [25]). Further, there was no material before the Minister's delegate which suggested that more inquiries could have yielded a useful result (SZIAI at [26]).
11. In these circumstances, SHCAG has not established that there was a relevant failure to examine and take into account social and economic impacts by the Minister's delegate. Grounds 1 and 2 are not established.
12. SHCAG relied on the ESG2 guidelines stating that any direct economic impacts which have a cost to the community or individuals should be assessed as supporting its case. Although not arising strictly given my reasoning on the issues raised I observe that contrary to the Minister's submissions stating that there was no statutory basis for this part of SHCAG's case because it relied on the ESG2 guidelines, I consider that these do inform the scope of the duty to examine and take into account matters in s 111 of the EPA Act. Because these guidelines apply as provided for in cl 228(3) of the Environmental Planning and Assessment Regulation 2005 detailed matters referred to cl 228(1) of that Regulation do not apply. The detail of that Regulation was relevant to the reasoning of Pepper J in Fullerton Cove at [150] when considering the nature of the duty in s 111.

Activity not likely to significantly affect the environment

1. The third ground of judicial review alleges a failure by the Minister to comply with s 112 of the EPA Act in not requiring Hume Coal to prepare an EIS. An EIS is required for an activity which is likely to significantly affect the environment.
2. SHCAG submits that the phase 3 program is likely to significantly affect the environment and an EIS was required pursuant to s 112. No EIS was provided by Hume Coal to the Minister and the Minister did not require an EIS to be prepared. The Respondents submitted formally that the conclusion in Fullerton Cove at [49] and [300] that s 112 gives rise to a jurisdictional fact was incorrect in order to preserve their appeal right on that matter. The Respondents accepted that this Court was likely to apply Fullerton Cove in the interests of judicial comity inter alia and did not therefore address this aspect of Fullerton Cove fulsomely. I will apply the finding in Fullerton Cove in relation to s 112 given Pepper J's thorough analysis of relevant authorities from [230]-[299] leading to her conclusion in [300] with no indication that her analysis is plainly wrong and in the interests of judicial comity. It falls to the Court to determine on the available evidence whether the activity is likely to significantly affect the environment. An important consequence of such an approach is that evidence not before the decision-maker can be brought before the Court, hence the expert evidence adduced by the parties and summarised above and the affidavits of the landowners can be considered.
3. The meaning of "likely" was considered as "a real chance" or "possibility" and "significantly" as "important", "notable", "more than ordinary" in Speleological Society at [84] (in the context of Pt 4 of the EPA Act) cited in Parks and Playgrounds Inc [134] and Fullerton Cove at [322] (in the context of s 112 Pt 5).

Onus of Proof

1. Hume Coal submitted that SHCAG as the party seeking relief has not discharged the onus of proof it bears of establishing a likelihood of significant environmental harm. SHCAG submitted that it bears no onus of proof as s 112 of the EPA Act is a question of jurisdictional fact which is a matter the Court must decide on the evidence before it. How the onus of proof arises if at all in relation to s 112 is therefore in dispute.
2. In support of the approach that s 112(1) gives rise to a question of jurisdictional fact that the Court must determine for itself Fullerton Cove at [49] and [300], Parks and Playgrounds Movement Inc at [132], Oshlack v Rous Water [2011] NSWLEC 73; (2011) 184 LGERA 365 at [5]-[6] and Eurobodalla Fluoride Issues Inc v Eurobodalla Shire Council [2014] NSWLEC 182 at [149] were cited. Considering these decisions in the context of onus of proof, in Fullerton Cove the applicant submitted that the Court ought to be satisfied that the activity was likely to significantly affect the environment because of, inter alia, the likely impact of the activity on two bird species. According to the applicant, because no seven-part test of significance in respect of the two species had been carried out, it could not be said that the activity would not significantly affect the environment. Pepper J cautioned that stating the test this way "risks reversing the onus of proof. It is not for [the respondents] to satisfy the Court that the pilot program is [not] likely to significantly affect the environment": at [321]. The inference from this observation is that the applicant bore the onus of proof in relation to establishing the jurisdictional fact there in issue.
3. In Parks and Playgrounds Movement Inc the issue of onus of proof was discussed in the context of the precautionary principle as I refer to below. Biscoe J reviewed expert evidence adduced by both parties before holding that the relevant activity was not likely to significantly affect threatened species or their habitats. Oshlack v Rous Water considered preliminary questions of law directed to the application of ss 111 and 112 of the EPA Act in the context of the Fluoridation of Public Water Supplies Act 1957 (NSW) and it was not necessary to consider the onus of proof. Onus of proof was not separately identified as an issue in Eurobodalla Fluoride. The Court considered the relevant expert evidence concerning health impacts if any of fluoridation of a water supply and concluded that the applicant had not established that there was a breach of s 112 of the EPA Act at [172] suggesting the applicant did bear the onus of proof.
4. Hume Coal submitted that its approach to s 112 is consistent with the orthodox approach to judicial review proceedings in which jurisdictional error is asserted. The authorities it referred to affirmed that the applicant in such proceedings bears the onus of establishing jurisdictional error. The characterisation of a matter as a jurisdictional fact does not alter SHCAG's onus of proof. That onus "does not shift from the [applicant] merely because the fact in issue may be described as a jurisdictional fact (and thus is a matter a court must decide for itself)": Maroun v Minister for Immigration and Citizenship [2009] FCA 1284; (2009) 112 ALD 424 at [15]. In SZGUR Gummow J at [67] identified that the moving party bears the onus of establishing jurisdictional error and nothing in the Migration Act 1958 (Cth) displaced that usual position.
5. SHCAG responded that s 112 must be considered in the context of the EPA Act which includes the precautionary principle as part of the objects of that Act as a principle of ESD. The precautionary principle as identified in Telstra Corporation Ltd v Hornsby Shire Council [2006] NSWLEC 133; (2006) 67 NSWLR 256 at [138]-[183] means that the onus shifts or is removed. The threshold factors are present in this case as there is a threat of serious damage to the environment as a result of the phase 3 program and there is scientific uncertainty about that threat as the locations of a number of boreholes, access tracks routes and their method of construction are unknown. The authorities relied on by Hume Coal which generally focussed on migration law did not therefore apply in the context of the EPA Act.
6. Hume Coal submitted the precautionary principle does not remove the onus on SHCAG as the moving party to establish the two conditions precedent necessary for the precautionary principle to apply, firstly, that a threat of serious or irreversible environmental damage exists, and secondly, the requisite degree of scientific uncertainty of that damage per Telstra v Hornsby at [128]. That approach is supported by Telstra v Hornsby at [43] and subsequent consideration of this issue in Parks and Playground at [152] referring to Telstra v Hornsby. SHCAG's submissions elide the need for it to establish the conditions precedent with an onus falling on Hume Coal.
7. The onus of proof in jurisdictional fact cases concerning s 112 does not appear to have been disputed and has not therefore received much judicial consideration in this Court. As already noted above, the assumption in Fullerton Cove at [321] and Eurobodalla Fluoride at [172] was that the applicant bore the onus of proof. The authorities relied on by Hume Coal in relation to the onus of proof in judicial review proceedings in which a jurisdictional fact arises is that the onus applies to an applicant to establish. The inclusion of the principles of ESD in the objects of the EPA Act does not as a matter of statutory construction expressly or impliedly change the application of the established onus of proof in judicial review proceedings identified by the High Court in SZGUR. That the High Court has identified such a principle in migration law cases does not mean these are to be ignored in this case.
8. I consider that SHCAG bears the onus of proof of establishing that the phase 3 program is likely to significantly affect the environment in order for the Court to be satisfied of that matter as a jurisdictional fact. If it does so by addressing the precautionary principle the two conditions precedent must be satisfied by it before any onus moves to Hume Coal.

Evidence relevant to s 112

1. The relevant factual context for the inquiry under s 112 of the EPA Act is identified above at par 154, 157 where the nature of the "activity" as described in the REF 3 and the Assessment Report is identified.
2. There is disagreement about the extent of likely harm and whether it is significant in the areas identified by SHCAG. Whether the initial question identified is the application of the first precondition to the precautionary principle, a threat of serious or irreversible damage to the environment, or the likelihood of there being a significant effect on the environment as referred to in s 112, the same evidence is considered. The expert evidence of Dr Davies, Mr Doyle, Mr Gardyne and Mr Richardson is summarised above at par 50-86. This evidence is most relevant to the environmental impact of access tracks and borehole sites. This topic links to the potential economic impacts of access tracks and boreholes claimed by the landowners. The evidence of the landowners set out above at par 87-109 is also relevant to this ground and is considered in relation to physical and economic and social impacts. The Court had the benefit of a view of the landowners' properties which assists in understanding the expert and lay evidence.

Access tracks

1. SHCAG argues that the length and location of access tracks, the length of formed construction, the nature of the construction, the materials used and the length of time to remediate the land impacted by that formed construction are unknown. SHCAG submitted that in order for the necessary assessment required under s 112 of the EPA Act to be satisfied, Hume Coal has to provide to the Court the actual location of proposed access tracks and an assessment of the impact of these. The legal implication of that submission which requires access to private land not owned by Hume Coal given the statutory regime in the EPA Act and the Mining Act has been fully canvassed above in relation to s 111 at par 161-167. I did not accept this aspect of SHCAG's case as it is not supported by the statutory scheme in either the EPA Act or the Mining Act.
2. Considering the expert evidence which addresses the likelihood of harm, in Dr Davies' opinion the access to the proposed boreholes will inevitably require the crossing of established creeks such as Wells Creek and overland flow paths. There is insufficient information in the REF 3 or evidence before the Court of impacts of the phase 3 program on compaction in creek beds, and other overland flow areas, interference with surface and sub-surface flow, impact of wheel ruts, damage to creek beds and banks, erosion and sediment control and the extent of engineering works required to overcome these issues. Dr Davies' expert report in reply identified succinctly the areas in which he continued to disagree with Mr Doyle and Mr Gardyne, largely in the context of criticising the REF 3.
3. SHCAG submitted that Dr Davies was concerned about two Wells Creek crossings in particular. One was the crossing at the bottom of the Roche property (with its exposure of Hawkesbury sandstone) in accessing HP357 and the other was the crossing on the Fesen/Pollicina property in accessing HP456. His opinion was that accessing HP357 by crossing Wells Creek would be likely to have a significant effect on the environment. The impact on the riparian area in accessing HP456 via the Pollicina property is likely to be substantial. Engineering works may be needed to cross these areas in particular, but without knowing the specificity of the works proposed, it is impossible to say with any certainty what the impact of the control works will be. Scant information has been provided by Hume Coal as to how these constraints can be satisfactorily overcome and, at the same time, limit their impact on the environment.
4. Further, Dr Davies has concerns about the potential adverse impacts of the locations of the proposed new access routes to the proposed borehole sites, in particular noting that there is a significant legal dispute between the parties as to whether Hume Coal will be permitted to access those drill sites using access routes as proposed by Mr Doyle, or whether entirely new access routes will need to be constructed, as contended by SHCAG.
5. SHCAG submitted the Court must conclude on the basis of the evidence that there is a threat of serious or irreversible damage to the local environment as a result of the activity and scientific uncertainty as to the scope and nature of that threat. The precautionary principle is thus engaged which Hume Coal bears the onus of discharging. Hume Coal has not discharged its onus that the phase 3 program is not likely to significantly affect the environment.
6. Hume Coal submitted that Dr Davies' assumptions were flawed as these focussed on alleged deficiencies identified in the REF 3 concerning access tracks. Such deficiencies (which were not admitted) do not equate to a significant impact on the environment. Dr Davies was not provided with the conditions of Authorisation 349 so he was not aware of the controls these conditions imposed on Hume Coal nor that Hume Coal is bound to comply with these (TS 117/4-43). The evidence of Mr Doyle and Mr Gardyne supports a finding that the phase 3 program is not likely to significantly affect the environment.
7. Ameliorative measures proposed to mitigate harm can be taken into account in an assessment under s 112 of the EPA Act. Authorisation 349 and the REF 3, which must be complied with, impose significant restrictions in relation to access tracks which would prevent, mitigate and remedy any environmental impact of the use of such tracks. Any impact of an access track would be quickly remediated so that it could not be characterised as significant, per Mr Doyle (TS 94/18-28).

Finding on physical impacts of access track

1. I will first consider the expert evidence on the likely physical impact of access tracks and the operation of the boreholes. Dr Davies' report in reply maintained his view that in order to assess the environmental significance of the project, access pathways for each borehole should have been finalised and included in the REF 3 to enable assessment of impacts at each site. If unavailable, alternative preferred options for access should have been presented in the REF 3 to enable consideration of detailed site planning and assessment of impacts. Each option should at a minimum give consideration to environmental sensitivities, land use and expectations of the affected property owners as well as details of construction, maintenance, use and rehabilitation. The omission of access track location, impact and controls necessary to minimise impacts represents a failure in the REF 3 to properly assess the potential impacts of the phase 3 program in order to determine if it would significantly impact on the environment. The proponent cannot assume the use of existing tracks to gain access to drilling locations given the affidavits of landowners claiming these are significant improvements. Options should be provided which include the avoidance of significant improvements on the properties. There is insufficient detail about the construction, maintenance and rehabilitation of possible creek crossings in the REF 3. The REF 3 refers to the laying of gravel on new access tracks. Mr Doyle clarified in his evidence that any gravel laid would be retained at the landowners request or removed. This ambiguity should have been clarified in the REF 3. Dr Davies agreed that the 100 metre buffer around the identified borehole sites enabled flexibility to reduce environmental impact of its location.
2. Dr Davies stated that there was a failure to consider alternatives to cut and fill identified as being required for the boreholes on the Alexander (HP048CH) and the Pollicina (HP265PC) properties. The REF 3 does not make clear if all heavy machinery will have wheels or fitted tracks and the impact of these. The Roche property's use as a horse eventing centre is particularly sensitive to environmental impacts and the REF 3 has not taken this into account. Dr Davies considered the REF 3 failed to adequately consider crossings across watercourses. The absence of clear and specific controls together with the lack of precise locations of access tracks across waterways could result in a significant environmental impact if activities are undertaken during extreme weather events. Comparison with existing land uses of grazing and cropping is not appropriate and the activity occurring in Sydney's drinking water catchment required a neutral or beneficial effect test. The activity should not have a negative effect irrespective of the current land use.
3. SHCAG essentially relied on the written report of Dr Davies and did not refer in much detail to his oral evidence or any of the other expert evidence contradicting him, particularly that of Mr Doyle and Mr Gardyne. It is necessary to consider some of the quite proper concessions made in cross-examination by Dr Davies. Hume Coal provided a comprehensive review of the expert evidence focussing not surprisingly on what evidence supported its case.
4. One of Dr Davies' principal concerns was that specific access tracks were not specified in the REF 3 so that in his opinion specific environmental impacts could not be assessed. That opinion is not supported by the evidence of Mr Doyle or Mr Gardyne. In assessing environmental impact the ameliorative measures proposed when an "activity" is undertaken can be considered by the Court (as I have held above at par 155). In undertaking the phase 3 program Hume Coal is required to comply with the conditions in Authorisation 349 and the REF 3. There is no acknowledgment of that important qualification in Dr Davies' evidence and he agreed in cross-examination he had not been provided with Authorisation 349 (see par 61). Conditions 2, 9, 17, 23, 24, 38 and 39 of Authorisation 349 impose important controls on the building of access tracks and the establishment of boreholes. The REF 3 contains a number of compulsory ameliorative measures relating to access tracks, such as the flexibility of having a borehole within a radius of 100 metre enabling the shortening of access tracks and the reduction of access impacts. Dr Davies acknowledged this benefit in oral evidence as representing good practice (see par 60). Hume Coal's written outline of closing submissions at par 34(b)-(o) accurately identified fourteen other controls in the REF 3 in relation to the use of existing tracks where feasible, avoidance of clearing threatened ecological communities (about which there is no longer a dispute as between Dr Davies and Mr Richardson), maximisation of ground cover, avoidance of creek crossings, minimisation of use of tracks during or after rainfall, appropriate drainage controls, removal of gravel unwanted by the landowner and rehabilitation requirements, inter alia.
5. The evidence of Mr Doyle and Mr Gardyne supports their opinion that the access tracks would not cause a significant impact on the environment (see par 63-85). Mr Doyle is Hume Coal's exploration manager, a position that includes the supervision of all Hume Coal's exploration activities from the planning, through to drilling, rehabilitation and the assessment of data gathered. He has over 35 years of experience in the coal industry, having worked in projects in New South Wales and Queensland. Much of this time has been spent in pursuit of exploration drilling activities for coal, with associated activities including landowner negotiations, siting of access tracks, rehabilitation of drill sites and authorising compensation for landowners. Mr Gardyne has more than 35 years of experience as a practising environmental scientist. For the past 20 years, he has worked as a self-employed consultant on the planning and construction of major construction projects, particularly linear infrastructure, with a particular focus on successful rehabilitation. This experience has included the preparation of Erosion and Sediment Control Plans for contractors working in the coal seam gas industry in Queensland and the Northern Territory.
6. According to Mr Doyle, Hume Coal would seek to minimise the use of gravel and upgrades to existing tracks may not be required. Access tracks on steeper slopes would be avoided in the first instance to locate more appropriate access, which would not require construction work or lengthy rehabilitation and is largely achievable based on the evidence of Mr Doyle and Mr Gardyne. Substantial infrastructure is not needed according to Mr Doyle due to the short term requirements of the access tracks. Hume Coal has a number of wet weather measures, which include standing down or delaying drilling activities, and using mud mats and gravel as identified in Mr Doyle's evidence set out at par 67. Gravel not required by a landowner would be removed. Mr Doyle outlines the weight and use of the drilling equipment at par 74. In his opinion the impacts can be fully rehabilitated in a relatively short space of time.
7. The actual amount and potential for erosion is quite low in Mr Doyle and Mr Gardyne's opinions. In Mr Gardyne's opinion, the only waterway of any significance is Wells Creek, which has been and continues to be highly disturbed through clearing and grazing activities. It is necessary to take into account existing land impacts. Mr Gardyne considered that based on the size of the drill rig, grass would probably be compacted but there would not be a total disturbance. The REF 3 details rehabilitation measures to be applied in some detail and conditions 38-40 of Authorisation 349 also require specific rehabilitation measures to be undertaken. Mr Gardyne addressed concerns raised about access to boreholes in wet areas and considered that access could be achieved without significant harm.
8. Mr Doyle's evidence addressed the concerns of Dr Davies and the landowners in relation to the Roche (HP362 and HP365 interference with equestrian events, HP357 wet ground and interference with equestrian events), Fesen (HP456, HP212PC, HP214PC and HP402 wet ground, HP202PC and HP295PC wet ground and interference with landholder use), Pollicina (HP253CH and 231PC wet ground, HP265PC requiring cut and fill), Alexander (HP351CH, HP352CH and HP345CH wet ground, HP048CH requiring cut and fill, HP245PC interference with use for cattle) and Martin (HP371 wet ground and HP374 wet ground and requiring a long access track) properties. Mr Doyle also gave his opinion that satisfactory access can be gained to HP346CH on the Alexander property, in respect of which Mr and Ms Alexander did not identify particular concerns (see par 68-73). The landowners' concerns are identified in their affidavits summarised above at par 87-109. Mr Gardyne addressed concerns regarding a number of proposed boreholes in wet areas.
9. Concerning the Pollicina property, Mr Doyle did not consider that HP265PC will require cut and fill works as this can be addressed by relocating the borehole site within the 100 metre radius. Mr Doyle stated that access to HP231PC, HP253CH and HP265PC on his site inspection was satisfactory and that shorter access tracks may be available. Concerning the Fesen property, Mr Doyle's evidence was that HP202PC and HP295PC could be relocated to address Mr Pollicina's concerns that these proposed boreholes would interfere with his use of those paddocks. On his site inspection, Mr Doyle had no difficulty accessing HP402 or HP214PC, but stated that access via Mr Pollicina's laneway would be more suitable. There could be a minor or moderate but not significant impact in accessing HP456 by crossing Wells Creek. This could be ameliorated by flattening ruts or avoided by accessing HP456 from the Pollicina property. Gate access to HP212PC would avoid wet ground. Mr Gardyne stated that gate access to HP212PC would address the need to cross the waterway. Crossing the waterway would not have a significant impact if crossed at a drier time or with temporary stabilisation. Access to HP456 is likely to be damp for much of the year and could be achieved by an all-weather crossing through the use of geofabric. To minimise impacts and rehabilitation costs, drilling may need to occur during a drier period. Mr Pollicina disputed whether access could be achieved through another property.
10. Concerning the Alexander property, Mr Doyle's evidence was that relocation within the 100 metre radius would address the issue of use for cattle (HP245PC), avoid Wells Creek (HP345CH) and cut and fill works would not be required (HP048CH). Mr Doyle stated that based on his site inspection HP346CH and HP352CH were easily accessed and that the ground was dry and firm. Mr Gardyne stated that HP351CH and HP345CH could be relocated away from wet ground.
11. Concerning the Martin property, Mr Doyle stated that HP371 could be accessed via the main entrance and would recommend that mud mats be used. There would be minimal impact if mud mats were used in accessing HP374 in a dry period. Accessing HP374 in wet conditions could cause impacts requiring rehabilitation. Mr Gardyne stated that as access to HP374 crosses the overflow path from the main dam, wetter times may need to be avoided. A crossing could be effected and rehabilitated. Alternative access could also be negotiated.
12. Dr Roche gave affidavit and oral evidence concerning the physical impacts of accessing and drilling boreholes HP357, HP365 and HP362 on the Roche property (see par 105-109). In Dr Roche's estimation, rehabilitation of HP357, located in the dressage arena, would take two to three years to return footing to current international standards. He is unaware of any dressage arena on which heavy vehicles and machinery have been used that has been successfully rehabilitated to international standards. In cross-examination, Dr Roche stated that if HP357 were relocated to the parking area it would not interfere with the eventing course. However, after an incident in which a truck was bogged in the parking area and caused damage to it, a decision was made that trucks could only go on the top side of the hill nearest to Kardinia Lane. A dam and swales were built in that paddock to try to dry it out, but this was unsuccessful. It was clear following the view by the Court and the evidence of Mr Doyle that HP357 can be moved from the dressage arena area to the parking area where a lesser degree of rehabilitation would be required compared to an eventing area. Mr Doyle considered the impacts of access and drilling in the carpark area would be negligible (see par 68). Mr Gardyne observed a firm rock foundation at the Wells Creek crossing and no significant turbidity created by the crossing of a light vehicle. He considered that the use of the parking area for equestrian activities would have a greater impact than the phase 3 program (see par 78).
13. Dr Roche stated that more direct access to HP365 would render between 15-20% of the cross-country course unusable for two to three years. Dr Roche does not consent to alternative methods of access, such as access across the show jumping warm up arena, which would render it unusable, or methods of access through low and wet areas. In cross-examination Dr Roche gave evidence that a concrete truck had accessed the Roche property from Kardinia Lane and that a water bore drill rig almost definitely accessed the property the same way. Such trucks did not always do damage to the course, it depended on the weather. Driving a truck down part of the course would render it "unusable for probably two years". Part of the eventing arena in which a truck carrying hay that had entered the Roche property via Golden Vale Road was bogged, was not used for about a year and other areas of the track were used. Mr Doyle stated that an alternative access track could minimise travel through low and wet areas. Mud mats could also be used. Mr Doyle's evidence was that there would be no significant impact issues bringing the drilling equipment onto the property via Kardinia Lane. Further, HP365 could be relocated next to the fence to minimise impact on the equestrian course (see par 69). Mr Gardyne considered that any impact of crossing a wet location in accessing HP365 could be managed by using the crossing when it is dry. This could be done at a certain time of the year or by the landowner dropping the level of the downstream dam (see par 78).
14. According to Dr Roche the proposed access to HP362 would render ten per cent of the course unusable for two to three years. In cross-examination, Dr Roche stated that there used to be a gate on the fence line bordering Golden Vale Road, which was accessed by trucks carrying hay. The paddock in which HP362 is proposed had been used for grazing cattle. Dr Roche stated that "it may be possible" to design a course avoiding the footprint of HP362, if it were confined to a 25 x 25 metre footprint, but that the borehole sites he had seen had a larger footprint. A location very close to the fence line bordering Golden Vale road is available within the 100 metre radius. In Mr Doyle's assessment there would be no issues with drilling HP362 along the fence line and that any compaction from vehicle impacts would be easily rehabilitated (see par 70).
15. Given Mr Doyle's considerable practical experience in undertaking the drilling processes the subject of his evidence and the phase 3 approval I accept his evidence that the concerns of Dr Davies and of the landowners of grazing properties can be adequately addressed. His views are supported by those of Mr Gardyne who considered that satisfactory arrangements can be made to minimise environmental harm when accessing wet areas. The Roche property has the most sensitive land use environmentally and economically. While it appears on the evidence of Mr Doyle that the physical impact would not be significant environmentally there remain potential economic issues concerning the use of the property which I will consider below.
16. Dr Davies is a practising environmental scientist, planner and academic researcher, who has experience working as a local government environmental planner and scientist reviewing general mining and related applications. He reviewed development applications for various activities including mining as a senior manager at a government authority. While I accept that Dr Davies is an expert in his field there are some difficulties with his approach to the evidence in this case. As already identified above in par 226 Dr Davies did not consider in any detail the ameliorative measures referred to by Mr Doyle.
17. Further difficulties with Dr Davies' approach include that he criticised the REF 3 but that does not address the question required by s 112. Another difficulty is that the provision of alternative options for access contended for by Dr Davies includes specification of the expectations of landowners and their view of significant improvements. There is no obligation on landowners to provide such information in a Pt 5 assessment engaged in by a proponent under the EPA Act, and the determination of what is a "significant improvement" takes place under the Mining Act in the absence of agreement with a landowner. Further, there is an inherent tension in the approach advocated by Dr Davies and the legislative scheme in the EPA Act and separately the Mining Act. Condition 23 of Authorisation 349 and section 2.3.4 of the REF 3 "Site preparation" both require that as much as possible use will be made of existing tracks as a means of minimising environmental harm and these are binding requirements on Hume Coal. Dr Davies essentially adopted the landowners' submissions that as claimed significant improvements include most or all access tracks which would not therefore be available to Hume Coal other new tracks should have been identified in the REF 3. Ultimately the extent to which existing access tracks can be used will be the subject of an arbitral determination (and if necessary determination by the Court) under the Mining Act in the absence of agreement. Requiring options to be identified in the REF 3 which are potentially more environmentally harmful appears counterintuitive. A further difficulty with that approach is that it assumes the precise location of a borehole but the present approval has built in flexibility for the location of boreholes to enable appropriate variation of access tracks in order to reduce their impact.
18. I accept Hume Coal's submission that, based on the expert evidence identified above, the physical drilling of boreholes and making of access tracks are likely to have impacts that are short term for the properties used for grazing and cropping given the approach to construction and rehabilitation measures to be implemented. Accessing and drilling in appropriate weather conditions is obviously a key issue in reducing impact as Mr Doyle's evidence attests to. Condition 24 of Authorisation 349 restricts the use of access tracks in wet weather if not suited to that use. Mr Doyle's evidence extracted in par 67 refers to the efforts made to avoid drilling in wet weather and to deal with access across wet areas through the use of mud mats and gravel with the consent of a landowner. In the context of the REF 3, this means that the impacts do not exceed 12 months in effect (TS 349/37-39). The lack of specific detail of location and construction of access tracks when the ameliorative measures required to be implemented are identified does not lead to a conclusion that the activity would have a significant physical impact in the long-term meaning more than 12 months in the context of this activity.

Economic and social impacts

1. SHCAG submitted the economic and social impacts of the phase 3 program on the affected landowners and the local community were impacts I should examine because the community responses to the project form part of the public interest citing Bulga at [63]. The landowners' concerns are more than a fear without rational or justified foundation which alone is not an amenity or social impact, Bulga at [63]. Their evidence of likely economic and social consequences of approval was based on the experience and costs of dealing with Hume Coal in arbitration under the Mining Act in current ongoing processes. Their evidence is more than an expression of subjective fear and concern. Their affidavit evidence also referred to concerns they had about the impact of the phase 3 program on the uses of their properties.
2. Hume Coal relied on reasons given already in relation to s 111 of the EPA Act as to why the social and economic impacts relied on by SHCAG concerning resisting access arrangements and arbitration under the Mining Act are not matters relevant to assessing any likely impact on the environment. Such matters have insufficient nexus to the "activity" to justify being characterised as being likely to significantly affect the environment for the purposes of s 112. The access arrangements under the Mining Act have been made by Parliament in a statutory scheme which provides for parties to bear their own costs but for the arbitrator for whom the holder of the prospecting licence pays (s 152 of the Mining Act). I have accepted those arguments at par 197.
3. Hume Coal submitted that reliance on broader fears and concerns of local residents about coal mining and CSG identified in Mr Martin's affidavit of 18 February 2015 are not relevant. The mixed nature of the evidence of community concern about the impact of a future and unapproved coal mine and about CSG (which Hume Coal is not engaged in) with evidence of SHCAG's opposition in the past and future is not probative of any relevant impact. No weight should be given to evidence of local residents' concerns generally in considering the impact of the phase 3 program. There is no probative evidence to make findings of adverse social impacts of the drilling of 25 boreholes.

Finding on social and economic impacts

1. For reasons concerning statutory construction already stated in relation to s 111 the economic costs to landowners of opposing access arrangements under the Mining Act are not relevant to the assessment of the likely significance of environmental impact under s 112 of the EPA Act.
2. The landowners' affidavits identify concerns about the impacts of the phase 3 program, such as possible damage to claimed significant improvements and interference with how they run their properties. Mr Alexander was concerned about impact on what he considered to be significant improvements such as fences, cattle laneways and the underground water reticulation system on his property. Mr Pollicina farms cattle and is concerned about the impact in conjunction with Fesen Pty Ltd of use of the affected paddocks on a rotational basis. He is concerned about claimed significant improvements such as underground watering systems being impacted upon. Mr and Mrs Martin graze cattle, grow lucerne and have a truffiere. They have made a number of improvements to the property, including the construction of a dam, a 800 metre driveway, and a house.
3. The economic costs relate in large part to concerns by landowners about impacts on the use of their lands resulting from the preparation and use of the access tracks and boreholes, the physical impacts of which I consider are not significant given the number of ameliorative measures available which include arrangements for wet weather and the flexibility afforded in the location of boreholes. Impacts on infrastructure such as water reticulation systems and fencing are also of concern, all of which are claimed as significant improvements. There is material in the REF 3 and the Assessment Report relevant to this topic, as cited in relation to s 111 (see par 194-195).
4. A key issue for all landowners is the timing of construction and drilling and subsequent rehabilitation of sites for up to one year. The Assessment Report identifies at sections 4.2 and 4.5 the period for drilling as being up to four weeks (see par 28). The REF 3 provides that site occupation for each borehole would be approximately four weeks, although delays may occur due to wet weather or to accommodate specific landowner requests or farm management activities (see par 36). The assessment undertaken in the AIS assumes that each borehole would require an area of up to approximately 625m2 for a period of less than four weeks (see par 44). Mr Doyle stated that the four week period per site is a conservative estimate for all activities, including drilling and rehabilitation (EB vol 7, p 2957). Mr Gardyne referred to an eight week period for the drilling program (see par 78) but that period is not supported by the other evidence referred to. The access arrangements under the Mining Act can include negotiation on the timing of access as well as the location of tracks and the provision of compensation where necessary for nuisance and inconvenience.
5. The property with the most sensitive land use environmentally and economically is the Roche property given its use for horse eventing which requires appropriate surface quality to ensure safe footing for horses and riders across most of the property. Dr Roche considered that two to three years' rehabilitation of affected ground to the necessary standard would be required. In terms of economic cost Dr Roche's affidavit referred to the Berrima Horse Trials competitions held in March, June/July and November and other events and activities held at the property throughout the year. Cancellation of any of the competitions would result in significant economic loss to his family and to the wider community of the Southern Highlands. Apart from footing safety, the principal safety issue identified was noise as horse training and eventing would not be able to take place within 400 or 500 metres of the source of the sound of the drill rig and associated activities, according to Dr Roche (TS 161/10-28).
6. As identified above, timing of access to and drilling on a property is one of the matters either agreed or arbitrated under the Mining Act. In other words, that is a matter which can be negotiated with Hume Coal under the Pt 8 Div 2 process. Hume Coal submitted that the drill rig is intended to be at each site for about one week with the remainder of the estimated four weeks intended for setup and rehabilitation. That site occupation for each borehole would be approximately four weeks is confirmed by the REF 3 and Mr Doyle's evidence. I accept that given this evidence the timing for drilling on the Roche property could be arranged to minimise disruption to its use for eventing particularly the competitions in March, June/July and November held at the property.
7. In terms of individual boreholes and whether the disturbed areas requiring rehabilitation would impact on the use of the Roche property for horse eventing, HP357 can be moved from the dressage arena area to the parking area where a lesser degree of rehabilitation would be required compared to an eventing area. Mr Doyle considered the impacts of access and drilling would be negligible (see par 68). There would be no interference with the eventing course at this location. There may be disruption of eventing scheduling by drilling given the close proximity to the dressage arena. Timing can be negotiated with Hume Coal.
8. Access to HP365 via Kardinia Lane is one of many possible access routes according to Mr Doyle. Dr Roche considered this would potentially require access over wet areas. Mr Doyle stated that an alternative access track could minimise travel through low and wet areas (see par 69). The borehole could be located next to the boundary fence to minimise impact from ongoing rehabilitation on the equestrian course.
9. HP362 is intended to be located in a paddock which has been used at times for grazing. A location very close to the fence line bordering Golden Vale Road is available within the 100 metre radius. Mr Doyle's assessment was there would be no issues with drilling HP362 "as planned along the fence line" and that any compaction from vehicle impacts would be easily rehabilitated (see par 70). In cross-examination Dr Roche agreed that parts of the course had been excluded on other occasions where areas required rehabilitation. His evidence was that up to 90% of the property was needed for eventing. The rehabilitation of the two boreholes HP365 and HP362 would potentially impact on some of the eventing course, particularly HP365. The siting of both boreholes very close to the fence-line would reduce any potential impact.
10. It is difficult to conclude on the evidence that drilling boreholes HP362 and HP365 would result in a substantial economic impact on the Roche property. To the extent there is disruption there is provision for compensation to be payable under the access arrangements in the Mining Act. Dr Roche is justifiably concerned about wider economic impacts in the community if fewer events are held on the property. This impact could be minimised for the reasons already stated.
11. In relation to rehabilitation time, as I understand Hume Coal's submissions, confirmed by the terms of the phase 3 approval, if the REF 3 cannot be complied with a borehole is not permissible under the approval, a matter which can be negotiated under the Pt 8 Div 2 Mining Act process. If rehabilitation of the area around a borehole and access track would take more than twelve months to rehabilitate as Dr Roche attests is likely, that borehole could not be drilled. It appears from Dr Roche's oral evidence that measures have been taken when a truck was bogged on one occasion to avoid that area of the property for twelve months. It is Mr Doyle's evidence that it is very likely rehabilitation could occur within 12 months but there is no doubt the surface of the Roche property requires greater attention to rehabilitation outcomes than if it were used for grazing or cropping. I cannot conclude finally whether rehabilitation is achievable in twelve months in these proceedings nor is it necessary that I do so.
12. The social costs identified in Mr and Mrs Martin's affidavits relate to community opposition to exploration activities and future potential coal mine or CSG projects. Mr Martin's affidavit details the extent of community concern in relation to Hume Coal's past and future activities (see par 94). Such concerns in the context of the limited activity of exploration in the phase 3 program are not irrelevant, contrary to Hume Coal's submissions. The issue of opposition to mining activities is referred to in any event in both the REF 3 and the Assessment Report as being difficult to quantify and resolve, as discussed at par 194-195. Given that the phase 3 program is work preliminary to any decision about a coal mine in the Southern Highlands and not a proposal for an actual coal mine it is difficult to conclude that concern about a possibility is a significant impact in this case. As stated in Bulga such concerns and fears must be rational, as indeed they are. Unlike Bulga which was considering a specific coal mine extension in Class 1 proceedings, such concerns are less pressing in the context of this case.

Cumulative impacts

1. SHCAG submitted that the same cumulative impacts identified in relation to s 111 of the EPA Act, being the cumulative effects of the drilling activity as a whole, must also be considered under s 112 referring to Kivi v Forestry Commission of NSW (1982) 47 LGRA 38 Cripps J at 47.
2. I have considered the issue of cumulative impact already in the context of s 111 finding no basis for making a finding that the Minister had failed to examine and take into account any such impacts had been demonstrated. I found the impacts said by SHCAG to require consideration as cumulative did not arise from the phase 3 program at par 190. The same reasoning would apply also in relation to s 112 as there is no additional evidence to consider in relation to the s 112 ground.

Conclusion

1. In conclusion I consider no likelihood (meaning a real chance) of the phase 3 program significantly (meaning more than ordinarily, importantly) affecting the environment has been established by SHCAG. Alternatively, there is no threat of serious or irreversible damage to the environment if considered in the context of the precautionary principle. There is no need to consider the second condition precedent concerning scientific uncertainty. Ground 3 is not established.
2. As SHCAG has been unsuccessful its amended summons should be dismissed. Costs are reserved.

Orders

1. The Court makes the following orders: 1. The amended summons filed in Court 29 April 2015 is dismissed. 2. Costs reserved.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 05 August 2015