Environment Protection Authority v Maules Creek Coal Pty Ltd

[2022] NSWLEC 33

Land and Environment Court

New South Wales

• Amendment notes

Medium Neutral Citation:

Environment Protection Authority v Maules Creek Coal Pty Ltd [2022] NSWLEC 33

Hearing dates:

22 February 2022

Date of orders:

31 March 2022

Decision date:

31 March 2022

Jurisdiction:

Class 5

Before:

Pepper J

Decision:

See orders at [243].

Catchwords:

ENVIRONMENTAL OFFENCE – pollution of waters – discharge of sediment laden water into a creek – discharge of expanded polystyrene beads into a creek – plea of guilty – sentencing principles – determination of the objective seriousness of the offence – extent of harm – whether extreme rainfall events reasonably foreseeable – consideration of the subjective circumstances of the defendant – one prior conviction – discount for early guilty plea – assistance to authorities – examination of comparable cases – monetary penalty – publication order – costs order made.

Legislation Cited:

Crimes (Sentencing Procedure) Act 1999, ss 3A, 21A(2), 21A(3), 22, 23

Criminal Procedure Act 1986, ss 257B, 257G

Environmental Planning and Assessment Act 1979, s 75J

Fines Act 1996, s 22A(2)

Protection of the Environment Operations Act 1997, ss 64, 91, 120(1), 191, 241, 248, 250(1)

Water Management Act 2000, s 60A(2)

Cases Cited:

Axer Pty Ltd v Environment Protection Authority (1993) 113 LGERA 357

Barnes v O’Haire [2020] NSWLEC 158

Bentley v BGP Properties Pty Ltd [2006] NSWLEC 34; (2006) 145 LGERA 234

CabonneShire Council v Environment Protection Authority [2001] NSWCCA 280; (2001) 115 LGERA 304

Camilleri’s Stock Feeds Pty Ltd v Environment Protection Authority (1993) 32 NSWLR 683

Chief Executive, Office of Environment & Heritage v Orica Pty Ltd; Environment Protection Authority v Orica Pty Ltd [2015] NSWLEC 109

City of Parramatta Council v Sydney Trees Excavation and Demolition Pty Ltd [2021] NSWLEC 71

Director-General of the Department of Environment and Climate Change v Rae [2009] NSWLEC 137; (2009) 168 LGERA 121

Elias v The Queen [2013] HCA 31; (2013) 248 CLR 483

Environment Protection Authority v Baiada Poultry Pty Ltd [2008] NSWLEC 280; (2008) 163 LGERA 71

Environment Protection Authority v Ballina Shire Council [2006] NSWLEC 289; (2006) 148 LGERA 278

Environment Protection Authority v Barnes [2006] NSWCCA 246

Environment Protection Authority v Big Island Mining Pty Ltd [2014] NSWLEC 131

Environment Protection Authority v Causmag Ore Company Pty Ltd [2015] NSWLEC 58

Environment Protection Authority v Centennial Newstan Pty Ltd [2010] NSWLEC 211

Environment Protection Authority v Ditchfield Contracting Pty Ltd [2018] NSWLEC 90

Environment Protection Authority v Fulton Hogan Pty Ltd [2008] NSWLEC 268; (2008) 163 LGERA 354

Environment Protection Authority v John Michelin & Son Pty Ltd [2019] NSWLEC 88

Environment Protection Authority v M A Roche Group Pty Ltd; Environment Protection Authority v Roche [2013] NSWLEC 191

Environment Protection Authority v Moolarben Operations Pty Ltd [2012] NSWLEC 65

Environment Protection Authority v Ravensworth Operations Pty Ltd [2012] NSWLEC 222

Environment Protection Authority v Sydney Water Corporation [2021] NSWLEC 17

Environment Protection Authority v Wambo Coal Pty Ltd [2017] NSWLEC 152

Environment Protection Authority v Waste Recycling and Processing Corporation [2006] NSWLEC 419; (2006) 148 LGERA 299

Gittany Constructions Pty Ltd v Sutherland Shire Council [2006] NSWLEC 242; (2006) 145 LGERA 189

Hoare v The Queen [1989] HCA 33; (1989) 167 CLR 348

Johnson v The Queen [2004] HCA 15; (2004) 78 ALJR 616

Liverpool City Council v Leppington Pastoral Co Pty Ltd [2010] NSWLEC 170

Markarian v The Queen [2005] HCA 25; (2005) 228 CLR 357

Mill v The Queen [1988] HCA 70; (1988) 166 CLR 59

Muldrock v The Queen [2011] HCA 39; (2011) 244 CLR 120

Natural Resources Access Regulator v Maules Creek Coal Pty Ltd [2021] NSWLEC 135

Pearce v The Queen [1998] HCA 57; (1998) 194 CLR 610

Plath v Rawson [2009] NSWLEC 178; (2009) 170 LGERA 253

R v Dodd (1991) 57 A Crim R 349

R v Harris [2007] NSWCCA 130; (2007) 171 A Crim R 267

R v MAK; R v MSK [2006] NSWCCA 381; (2006) 167 A Crim R 159

R v Nichols (1991) 57 A Crim R 391

R v Oliver (1980) 7 A Crim R 174

R v Thomson; R v Houlton [2000] NSWCCA 309; (2000) 49 NSWLR 383

R v Visconti [1982] 2 NSWLR 104

R v Wheeler [2000] NSWCCA 34

Veen v The Queen [1979] HCA 7; (1979) 143 CLR 458

Veen v The Queen (No 2) [1988] HCA 1; (1988) 164 CLR 465

Walden vHensler [1987] HCA 54; (1987) 163 CLR 561

Water NSW v Barlow [2019] NSWLEC 30; (2019) 244 LGERA 1

Category:

Sentence

Parties:

Environment Protection Authority (Prosecutor)
Maules Creek Coal Pty Ltd (Defendant)

Representation:

Counsel:
E Muston SC with B Anniwell (Prosecutor)
T Howard SC (Defendant)

Solicitors:
Environment Protection Authority (Prosecutor)
Ashurst (Defendant)

File Number(s):

2021/9091, 2021/9092, and 2021/9093

Publication restriction:

Nil

Judgment

Maules Creek Coal Pty Ltd Pleads Guilty to Three Water Pollution Offences

1. The defendant, Maules Creek Coal Pty Ltd (“MCC”), has pleaded guilty to three offences against s 120(1) of the Protection of the Environment Operations Act 1997 (“POEOA”) at or near the Maules Creek mine (“the mine”) located at Therribri Road, Boggabri, New South Wales. MCC is charged with:

1. one count of polluting waters with sediment on 18 January 2020 (matter 2021/9091) (“the first offence”);

2. one count of polluting waters with sediment on 8 February 2020 (matter 2021/9092) (“the second offence”); and

3. one count of polluting waters with expanded polystyrene beads (“EPBs”) on 8 February 2020 (matter 2021/9093) (“the third offence”).

2. The amended summons for the first offence relevantly charged MCC with the following:

RELIEF CLAIMED

The Prosecutor claims:

1   An order that the Defendant, Maules Creek Coal Pty Ltd (ACN: 140 533 875), whose registered office is at Level 28, 259 George Street, Sydney, NSW appear before a Judge of the Court to answer the charge that, on or about 16 January 2020, at or near the Maules Creek Coal Mine, Therribri Road, Boggabri in the State of New South Wales (the Licensed Premises), it committed an offence against section 120(1) of the Protection of the Environment Operations Act 1997 (POEO Act) in that it polluted waters.

Particulars

(a) Waters:

Back Creek and downstream thereof.

(b) Pollutant:

Sediment and/or soil and/or earth and/or mud and/or stones and/or sand and/or clay and/or similar inorganic matter and/or washings and/or spoil from any extractive operation, and/or expanded polystyrene beads.

(c) Manner of breach:

The Defendant, which was the occupier of the Licensed Premises at or from which the pollution occurred, failed to manage sediment and erosion controls on the Northern Overburden Emplacement Area (NOEA) on the Licensed Premises, so as to prevent the Pollutant overtopping the wall of the subdrain that ran along the northern base of the NOEA and the Pollutant consequently:

(a) entering the Waters; and/or

(b) being placed in a position where it was washed into the Waters; and/or

(c) being placed in a position where it was likely to wash into the Waters.

3. The amended summons for the second offence stated:

RELIEF CLAIMED

The Prosecutor claims:

1   An order that the Defendant, Maules Creek Coal Pty Ltd (ACN: 140 533 875), whose registered office is at Level 28, 259 George Street, Sydney, NSW appear before a Judge of the Court to answer the charge that, on or about 8 February 2020, at or near the Maules Creek Coal Mine, Therribri Road, Boggabri in the State of New South Wales (the Licensed Premises), it committed an offence against section 120(1) of the Protection of the Environment Operations Act 1997 (POEO Act) in that it polluted waters.

Particulars

(a) Waters:

Back Creek and downstream thereof.

(b) Pollutant:

Sediment and/or soil and/or earth and/or mud and/or stones and/or sand and/or clay and/or similar inorganic matter and/or washings and/or spoil from any extractive operation.

(c) Manner of breach:

The Defendant, which was the occupier of the Licensed Premises at or from which the pollution occurred, failed to manage sediment and erosion controls on the Northern Overburden Emplacement Area (NOEA) on the Licensed Premises, so as to prevent the Pollutant overtopping of the wall of the subdrain that ran along the northern base of the NOEA and the Pollutant consequently:

(a) entering the Waters; and/or

(b) being placed in a position where it was washed into the Waters; and/or

(c) being placed in a position where it was likely to wash into the Waters.

4. Finally, the third offence was charged in the following way:

RELIEF CLAIMED

The Prosecutor claims:

1   An order that the Defendant, Maules Creek Coal Pty Ltd (ACN: 140 533 875), whose registered office is at Level 28, 259 George Street, Sydney, NSW appear before a Judge of the Court to answer the charge that, on or about 8 February 2020, at or near the Maules Creek Coal Mine, Therribri Road, Boggabri in the State of New South Wales (the Licensed Premises), it committed an offence against section 120(1) of the Protection of the Environment Operations Act 1997 (POEO Act) in that it polluted waters.

Particulars

(a) Waters:

Back Creek and downstream thereof.

(b) Pollutant:

… expanded polystyrene beads.

(c) Manner of breach:

The Defendant, which was the occupier of the Licensed Premises at or from which the pollution occurred, failed to prevent the Pollutant discharging from the spillway at Sediment Dam 3 (SD3) on the Licensed Premises and:

(a) entering the Waters; and/or

(b) being placed in a position where it was washed into the Waters; and/or

(c) being placed in a position where it was likely to wash into the Waters.

5. Section 120(1) of the POEOA creates an offence of polluting waters:

120   Prohibition of pollution of waters

(1)   A person who pollutes any waters is guilty of an offence.

6. The terms “pollution of waters” and “waters” are defined in the Dictionary of the POEOA as:

water pollution or pollution of waters means—

(a)   placing in or on, or otherwise introducing into or onto, waters (whether through an act or omission) any matter, whether solid, liquid or gaseous, so that the physical, chemical or biological condition of the waters is changed, or

(b)   placing in or on, or otherwise introducing into or onto, the waters (whether through an act or omission) any refuse, litter, debris or other matter, whether solid or liquid or gaseous, so that the change in the condition of the waters or the refuse, litter, debris or other matter, either alone or together with any other refuse, litter, debris or matter present in the waters makes, or is likely to make, the waters unclean, noxious, poisonous or impure, detrimental to the health, safety, welfare or property of persons, undrinkable for farm animals, poisonous or harmful to aquatic life, animals, birds or fish in or around the waters or unsuitable for use in irrigation, or obstructs or interferes with, or is likely to obstruct or interfere with persons in the exercise or enjoyment of any right in relation to the waters, or

(c)   placing in or on, or otherwise introducing into or onto, the waters (whether through an act or omission) any matter, whether solid, liquid or gaseous, that is of a prescribed nature, description or class or that does not comply with any standard prescribed in respect of that matter,

and, without affecting the generality of the foregoing, includes—

(d)   placing any matter (whether solid, liquid or gaseous) in a position where—

(i)   it falls, descends, is washed, is blown or percolates, or

(ii)   it is likely to fall, descend, be washed, be blown or percolate,

into any waters, onto the dry bed of any waters, or into any drain, channel or gutter used or designed to receive or pass rainwater, floodwater or any water that is not polluted, or

(e)   placing any such matter on the dry bed of any waters, or in any drain, channel or gutter used or designed to receive or pass rainwater, floodwater or any water that is not polluted,

if the matter would, had it been placed in any waters, have polluted or have been likely to pollute those waters.

waters means the whole or any part of—

(a)   any river, stream, lake, lagoon, swamp, wetlands, unconfined surface water, natural or artificial watercourse, dam or tidal waters (including the sea), or

(b)   any water stored in artificial works, any water in water mains, water pipes or water channels, or any underground or artesian water.

MCC Operates a Mine

7. The facts giving rise to the commission of the three offences were not in dispute and were contained in a statement of agreed facts dated 29 October 2021, an additional statement of agreed facts on environmental harm dated 21 February 2022, and a further statement of agreed facts on environmental harm dated 21 February 2022.

8. The mine is owned by Aston Coal 2 Pty Ltd (“Aston Coal 2”) and J-Power Australia Pty Ltd, which hold mining leases over the mine. They have engaged MCC to operate the mine. Whitehaven Coal Limited (“WCL”) is the ultimate holding company of MCC, Aston Coal 2 and Whitehaven Coal Mining Limited (“WCML”).

9. The mine is an open cut coal mine located 45 km southeast of Narrabri and approximately 16 km northeast of Boggabri.

10. On 23 October 2012 the mine was approved under s 75J of the Environmental Planning and Assessment Act 1979 (“EPAA”). The State government declared the mine to be a State significant development for the purposes of the EPAA in August 2018.

11. Coal Lease 375, a mining lease granted under the Mining Act 1992 over the land on which the mine is situated, was renewed on 9 May 2013 until 4 June 2033 (“CL 735”). On 9 October 2014 an additional mining lease was granted, namely, mining lease 1701 (“ML 1701”). Both CL 735 and ML 1701 authorise mining for coal at the mine subject to the terms and conditions of those licenses.

12. Mining operations commenced at the mine in 2014.

13. The mine is an approved regulated activity under environment protection license 20221 (“the EPL”) issued to MCC under the POEOA on 2 May 2013. The boundaries of the mine are as follows:

14. Back Creek, an ephemeral tributary, is situated on the northern boundary of the mine. Back Creek flows in a westerly direction into Maules Creek, and Maules Creek ultimately joins the Namoi River.

The Environment Protection License

15. The EPL was issued to MCC in respect of the scheduled activities carried out at the mine, including mining for coal, coal works and crushing, grinding or separating of rock for construction activities. The EPL was most recently varied by the EPA on 27 November 2019.

16. The EPL provides for a number of licensed discharge points and water monitoring locations:

17. Condition P1.2 of the EPL sets the limits for the discharge of pollutants to water from the mine:

Water and land
EPA Identification no.	Type of Monitoring Point	Type of Discharge Point	Location Description
3	Wet Weather Discharge	Wet Weather Discharge	Dam labelled EPL(SD3) on aerial photo titled “Maules Creek Coal Project = MCC.EPL20221 Monitoring Locations” (DOC19/986052) dated 15/08/2019
Discharge water quality monitoring	Discharge water quality monitoring

18. Condition L2.3 of the EPL prohibits the pollution of waters by any pollutant other than oil, grease, pH and total suspended solids (“TSS”):

L2.3   To avoid any doubt, this condition does not authorise the pollution of waters by any pollutant other than those specified in the table/s.

19. The EPL sets the concentration limits for the discharge of oil and grease, pH and TSS at the mine from three sediment dams (labelled as EPL 3, EPL 7 and EPL 9 in the above image) in condition L2.4:

L2      Concentration limits

L2.1   For each monitoring/discharge point or utilisation area specified in the table\s below (by a point number), the concentration of a pollutant discharged at that point, or applied to that area, must not exceed the concentration limits specified for that pollutant in the table.

L2.2   Where a pH quality limit is specified in the table, the specified percentage of samples must be within the specified ranges.

L2.3   To avoid any doubt, this condition does not authorise the pollution of waters by any pollutant other than those specified in the table\s.

L2.4   Water and/or Land Concentration Limits.

20. The discharge point known as EPL 3 (see the figure above) or Sediment Dam 3 (“SD3”), was the location of the third offence.

21. Condition L2.5 of the EPL permits the TSS concentration limits at the discharge points to be exceeded if:

1. the discharge occurs solely as a result of rainfall measured at the mine that exceeds 38.4 mm over any consecutive five day period prior to the discharge occurring; and

2. all practical measures have been implemented to dewater all sediment dams within five days of rainfall, such that they have capacity to store runoff from a 38.4 mm five day rainfall event.

The Water Management System

22. Operations at the mine included the removal of overburden (waste rock) using explosives and diggers to expose underlying coal seams. Overburden was transported by haul truck and deposited at a waste rock emplacement area known as the Northern Overburden Emplacement Area (“NOEA”) located near the northern boundary of the Mine.

23. Running along the northern base of the NOEA was a subdrain which conveys dirty water in a westerly direction along the eastern and northern boundary of the NOEA to SD3.

24. The NOEA was built to an engineered design prepared by Golder Associates Pty Ltd (“Golder”). Golder provided the designs to MCC but was not responsible for the implementation and construction of the NOEA, or other erosion or sediment controls.

25. The water management infrastructure at the mine at all relevant times included various water storage dams, water diversion drains, and erosion and sediment controls. Sediment dams were designed to capture and treat dirty water from the disturbed areas of the mine. Runoff that was captured by the sediment dams was transferred into the mine water management system to maintain the sediment dam capacity or was discharged off the mine if the EPL conditions for pollutant levels were met.

26. Under the terms of its approvals MCC was responsible for the implementation of the water management system and drainage infrastructure at the mine.

27. Condition 38 of Sch 3 to the consolidated development consent for the mine (last modified on 20 December 2019) (“the consent”), relevantly required MCC to:

…ensure that any surface water discharges of mine water from the site:

(a)   are of equal or better quality than the receiving waters; and

(b)   comply with the discharge limits (both volume and quality) set for the project in any EPL.

Note: The project is based on a zero discharge basis of mine water in all modelled meteorological events, however the Department acknowledges that discharge of treated water may be required to be undertaken following very extraordinary events outside modelled data, if approved under an EPL.

28. The consent required MCC to implement the Water Management Plan for the mine dated March 2019 (“the WMP”) and approved on 21 March 2019 by the Department of Planning, Industry and Environment pursuant to the consent. The WMP included a detailed description of erosion and sediment controls (dirty water management system) and the mine water management system.

29. The WMP relevantly stated:

Runoff accumulating in the sediment dams is pumped back into the mine water management system. If a rainfall event occurs that exceeds the design capacity of the sediment control system (see section 2.3.2), then water may be released offsite, in accordance with EPL conditions. Water captured in the sediment control system may also be released offsite at any time, provided water quality satisfies EPL conditions and it is not required to supply the mine water management system.

30. MCC’s consultant, WRM Water & Environment Pty Ltd (“WRM”), was commissioned to undertake a surface water impact assessment (“SWIA”) for the proposed mine as part of the Maules Creek Coal Project Environmental Assessment dated July 2011 (“the EA”).

31. The SWIA categorised surface water quality including:

Dirty – surface runoff water from areas that are disturbed by mining operations (including overburden emplacement areas)…This runoff may contain high sediment loads ... must be managed to ensure that downstream water quality is within the adopted water quality compliance criteria;

…

Contaminated – surface water from areas potentially containing chemicals of various types used in the mining operations. There are restrictions on the use and release of this water. Contaminated water areas include sumps, service bays and fuel storage areas. Rainfall and resulting runoff from these areas is also potentially contaminated and therefore must be managed to avoid discharge of potentially contaminated water into the natural watercourses or treated prior to reuse in the mine water management system.

32. WRM recommended that MCC implement the following measures for an effective system of mine water management:

Diversion of runoff from undisturbed catchments away from disturbed areas, wherever possible, using drains; Treatment of runoff from overburden emplacements through sedimentation dams prior to reuse in the mine water management system or discharge from the site…If the quality of runoff from disturbed areas is not suitable for release, this water will be pumped into the mine water management system;

Sediment dams will be used to treat surface runoff from rehabilitated areas until the quality of runoff is suitable for release...

The NOEA Was a Condition of MCC’s Approvals to Operate the Mine

33. Condition 2 of Sch 2 of the consent required that the construction and operation of the mine be carried out generally in accordance with the EA.

34. Figures 9 to 13 of the EA show the conceptual mine plan, including the location of the NOEA and the collection drain at the base of the NOEA (known as the subdrain) that drains to SD3.

35. The EA relevantly stated:

The ongoing management of overburden will include pre stripping topsoil from areas to be mined for use in final rehabilitation activities and placement of overburden within the Overburden Emplacement Areas in a manner that limits the risk of surface erosion. Field trials to identify the most appropriate topsoil and overburden materials for the revegetation and rehabilitation of final landforms will also be undertaken.

…

The Northern OEA is anticipated to be fully developed up to Reduced Level 430 m by the end of Year 10 (Figure 11). Rehabilitation activities of the Northern OEA will be undertaken progressively ensuring this area is largely rehabilitated by around Year 15 (Figure 12). The Western and southern faces of the Northern OEA are not proposed to be shaped for final rehabilitation until mining activities cease.

Temporary rehabilitation activities will be undertaken on these faces to provide the relevant cover to these slopes to minimise wind blow dust and reduce visual effects to receivers to the north-west…

Various minor infrastructure supporting day to day activities will be constructed within the Project Disturbance Boundary as required. This is likely to include: topsoil stockpiles, erosion and sediment control structures…

…

Since the presentation of the preferred mine plan within the PEA submitted in August 2010, the Project mine plan has been adjusted to address environmental, social and economic issues raised during the stakeholder consultation and assessment process. The Project mine plan and the assumptions used for modelling have been adjusted. Including:

…Temporary rehabilitation of the exposed spoil that will not be rehabilitated for extended periods of time…

36. The Mine Plan Justification 2011 prepared by Hansen Bailey at Appendix B to the EA stated that:

During the first ten years of operation, the NOEA is under progressive rehabilitation. As a portion of the NOEA is completed and no more emplacement of overburden is required to be undertaken out of pit, the NOEA will be topsoiled and vegetated to the standards in accordance with the Rehabilitation Management Plan. The steady state mining process sees that all waste materials generated from Year 10 onwards is dumped in-pit and rehabilitated progressively.

37. Condition 72 in Sch 3 of the consent required MCC to:

…rehabilitate the site progressively, that is, as soon as reasonably practicable following disturbance. All reasonable and feasible measures must be taken to minimise the total area exposed for dust generation at any time. Interim rehabilitation strategies shall be employed when areas prone to dust generation cannot yet be permanently rehabilitated.

38. The consent required MCC to prepare and implement a rehabilitation management plan to the satisfaction of the Resources Regulator, under condition 73 in Sch 3. The rehabilitation plan had to:

a.   be prepared in consultation with the Department of Planning, Industry and Environment (DPIE), Forests NSW, DPIE Water Division, DPIE Biodiversity and Conservation Division, North West Local Land Services and Narrabri Shire Council;

b.   be prepared in accordance with any relevant NSW Government mining rehabilitation guidelines;

c.   describe how the rehabilitation of the site would be integrated with the implementation of the biodiversity management plan;

d.   include detailed performance and completion criteria for evaluating the performance of the rehabilitation of the site, and triggering remediation action (if necessary);

e.   describe the measures that would be implemented to ensure compliance with the relevant conditions of the Consent, and address all aspects of rehabilitation including mine closure, final landform, and final land use;

f.   include interim rehabilitation where necessary to minimise the area exposed for dust generation;

g.   include a program to monitor, independently audit, and report on the effectiveness of the measures, and progress against the detailed performance and completion criteria; and

h.   build to the maximum extent practicable on the other management plans required under this approval.

39. Furthermore, condition 3 of ML 1701 relevantly provided that:

3.    Mining Operations Plan and Annual Rehabilitation Report

(a)   The lease holder must comply with an approved Mining Operations Plan (MOP) in carrying out any significant surface disturbing activities, including mining operations, mining purposes and prospecting. The lease holder must apply to the Minister for approval of a MOP. An approved MOP must be in place prior to commencing any significant surface disturbing activities, including mining operations, mining purposes and prospecting.

(b)   The MOP must identify the post mining land use and set out a detailed rehabilitation strategy which:

(i)   identifies the areas that will be disturbed;

(ii)   details the staging of specific mining operations, mining purposes and prospecting;

(iii)   identifies how the mine will be managed and rehabilitated to achieve the post mining land use;

(iv)   identifies how mining operation, mining purposes and prospecting will be carried out in order to prevent and or minimise harm to the environment; and

(v)   reflects the conditions of approval under:

• the Environmental Planning and Assessment Act 1979;

• the Protection of the Environment Operations Act 1997; and

•   any other approvals relevant to the development including the conditions of this mining lease.

(c)   The MOP must be prepared in accordance with the ESG3: Mining Operations Plan (MOP) Guidelines September 2013 published on the Department's website at lease holder may apply to the Minister to amend an approved MOP at any time.

…

(f)   The lease holder must prepare a Rehabilitation Report to the satisfaction of the Minister. The report must:

(i)   provide a detailed review of the progress of rehabilitation against the performance measures and criteria established in the approved MOP;

(ii)   be submitted annually on the grant anniversary date (or at such other times as agreed by the Minister); and

(iii)   be prepared in accordance with any relevant annual reporting guidelines published on the Department's website at start="40">

Similarly, condition 3 of CL 735 stated that “mining operations must not be carried out otherwise than in accordance with a Mining Operations Plan (MOP) which has been approved by the Director-General” and which must “detail the staging of specific mining operations”.

The rehabilitation management plan required by condition 73 of the consent was included in the Maules Creek Coal Mine Mining Operations Plan (dated 19 October 2018) for the period to 1 January 2023 (“MOP”). The MOP was approved by the Resources Regulator on 30 November 2018, pursuant to condition 3 of CL 735, condition 3 of ML 1701, and condition 73 of the consent.

The MOP stated that:

Temporary or interim rehabilitation is used to provide cover to minimise erosion and dust impacts.

The Northern OEA will be fully developed at Year 10 of operations. During this ten year timeframe areas of the southern and western faces of the Northern OEA will be temporarily rehabilitated with a cover crop and other non-invasive grass species to provide soil surface cover to minimise dust, visual impacts and erosion potential prior to final shaping and rehabilitation.

43. Plan 3B Mining and Rehabilitation of the MOP depicted the areas of the NOEA where the rehabilitation phases “landform” and “growth medium development” were to be completed by 1 January 2020. It also showed the areas of the NOEA authorised to be used for stockpiled material and ongoing overburden emplacement as of 1 January 2020.

44. The MOP required the rehabilitation phase termed “growth medium development” to be completed in respect of 100 ha of the NOEA by the end of 2019. The rehabilitation phase termed “ecosystem and land use establishment” was not scheduled under the MOP to commence until 2020. The relevant rehabilitation domains and phases are described in the MOP.

45. The MOP further relevantly provided:

5.2.2   Overburden Emplacement Area Domain

The OEA Domains (4E) consists of the areas within the Project Boundary used for overburden emplacement (i.e. the out-of-pit overburden emplacements as well as the in-filled sections of the open cut). The rehabilitation objective for this domain is to develop a free draining final landform designed to integrate with the surrounding catchments by channelling water towards natural drainage lines of Back Creek.

The domain will be progressively rehabilitated over the life of the mine. This will assist in minimising the mine disturbance area that is open at any one time and will reduce the environmental impacts of the mining operations (i.e. reduced dust emissions, and impacts on visual amenity and biodiversity).

The final shape of the OEA will be designed to integrate with the surrounding undisturbed topography as much as possible. The final rehabilitated batters will have an overall slope of 10 degrees, which will assist in maximising the long term stability and sustainability of the landform. There will also be areas shaped applying contemporary geomorphic design principles that will provide a natural looking landform appearance. The final batter slope and top surface configuration of the overburden emplacement area landform will be a key factor in determining which areas will be rehabilitated with species consistent with a White Box – Yellow Box – Blakeley's Red Gum Grassy Woodland, derived Native Grassland CEEC, and native forest. Generally speaking, it is expected that only the flatter areas and shallower parts of the overburden emplacement area will be used for this purpose.

…

5.4.3   Growth Medium Development

Rehabilitation of the MCCM will involve replacement of soil in areas where it has been stripped, and surface conditioning in areas where the soil was left in situ.

Ripping will be undertaken as required such as to address compaction and/or to incorporate ameliorants such as gypsum. Subsoil and/or topsoil will then be spread over the ripped areas using a grader or dozer. The depth and layering of respread soil will be based on the results of the pre-disturbance soil testing program (refer to Appendix D for detail, and Section 3.2.4 for a summary of this program).

The respread soil surface will be scarified prior to, or during seeding.

Some soils and mine spoils may have physical and chemical characteristics that will otherwise limit plant establishment and have a high potential for erosion. The pre-disturbance soil testing program (Appendix D) will be used to determine whether these materials can be ameliorated (and the required application rates), or whether they should be left in situ or buried within the overburden emplacement areas.

…

5.4.4   Ecosystem and Land Use Establishment

Erosion Control

Erosion control measures will be used at the MCCM rehabilitation areas in order to manage wind erosion, dispersive soils and spoils, provide soil surface cover, and to minimise the creation of concentrated surface water flow conditions. Erosion control works will include, but are not necessarily limited to the measures listed below.

●   Amelioration of dispersive spoil to minimise the risk of rill, gully and tunnel erosion and to allow the infiltration of surface water (reduce the amount and velocity of surface water)…

●   Contour scarification of compacted surfaces to encourage infiltration and surface roughness.

●   Use of cover crops potentially including salt tolerant sterile annual grasses, native grasses and native legumes to minimise raindrop and sheet erosion of reshaped areas.

●   Use of inert rock mulches of appropriate stone sizes and cover where effective and appropriate.

…

●   Engineered temporary channel banks, slope drains and energy dissipaters in areas where concentrated surface flow may occur to reduce erosion if necessary. Drainage and sediment control structures will be designed in accordance with Table 6.1 of Managing Urban Stormwater: Soils and Construction Volume 2E – Mines and Quarries (DECC, 2008).

●   Structural erosion controls may be used on overburden emplacement areas if necessary until vegetation cover is sufficient to provide adequate erosion protection.

●   In the larger drainage systems such as clean water drains and modified natural drainage systems, erosion control methods such as cross vanes, rock vanes and J-hook vanes will be used to provide channel bed and bank protection.

●   The management of erosion and sediment control for all mining and associated disturbances is detailed further in the Water Management Plan…

46. According to the MOP, the mine was in the “growth medium development” rehabilitation phase until the end of 2019.

47. MCC was responsible for implementing erosion and sediment controls on the NOEA. The construction and maintenance of these controls were set out in the MOP and the WMP.

48. MCC commissioned the following reports from external consultants on erosion and sediment control in respect of the NOEA in order to inform its construction, rehabilitation and management:

1. Landloch Pty Ltd (“Landloch”), Erosion Modelling Update – Northern Waste Emplacement Area, dated 2 November 2018;

2. Golder, Hydrological Assessment for Maules Creek, dated 29 July 2019 (“2019 Golder Report”); and

3. Aspect Ecology Pty Ltd, Maules Creek Coal Mine 2019 Rehabilitation Report for Whitehaven Coal, dated 28 November 2019.

49. The 2019 Golder Report recommended the rock sizes for the various drainage structures (or drop structures) that were to be constructed on the NOEA. These drop structures are drainage channels which are designed to be lined with large rocks that have the effect of slowing the velocity of runoff from the NOEA into the subdrain, therefore, reducing erosion within the drainage channel.

MCC Had Not Yet Completed Construction of the NOEA

50. The emplacement and shaping of overburden on the lower sections of the NOEA's northern and eastern faces was completed in December 2019. The emplacement of topsoil and ripping on those parts of the NOEA was completed on 20 December 2019. The NOEA had therefore not been constructed to its final height and was at RL 421.197 at its highest point on the eastern side as of 31 December 2019. Consequently, sediment and erosion controls for, and rehabilitation of, the NOEA were not complete by 16 January 2020.

51. As at 16 January 2020 the construction of the drop structures recommended in the 2019 Golder Report had also not been completed. Some drop structures had been partially installed on the NOEA, but they were not yet rock-lined.

52. MCC implemented ripping along the slope of emplaced topsoil designed to promote infiltration and slow down water flow. This work was completed on 20 December 2019, and was undertaken as an erosion control measure designed to reduce erosion on the NOEA until drains and drop structures could be installed.

Explosives Were Used at the Mine to Access Coal Seams

53. Explosives are used at the mine to fracture rock to access coal seams. In the process of preparing the explosives at the mine, EPBs are used to create low-density explosives.

54. An explosives compound is located within the mine. It comprises a storage facility and ancillary buildings and structures (“explosives compound”). HMS Australia Operations Pty Ltd (“Hanwha”) operates and manages the explosives compound under a contract with WCML (dated 30 November 2016) to supply explosive products, systems and services to the mine for a period of five years from 1 October 2016 (“supply contract”).

55. The supply contract relevantly stated (footnotes omitted):

…

b.   Hanwha agreed to perform its obligations under the Supply Contract in accordance with (among other things):

i.   all applicable laws and regulations;

ii.   any licence, permit, consent, authorisation etc;

iii.   “Good Operating Practices”;

iv.   the “Site Rules” including all rules, regulations, directions and policies of WCML which relate to health, safety, environmental protection, security and emergencies; and

v.   directions of WCML (clause 6(a));

c.   Hanwha was required to prepare, submit for approval by WCML, and comply with “Project Plans” for the Mine, which was defined to include an “Environmental Management Plan” and a “Licensed Area Management Plan” (clause 7);

…

e.   Hanwha warranted to WCML that (among other things):

i.   at all times while performing the Supply Contract, it would:

1.   “exercise due skill, care and diligence and Good Operating Practices”;

…

ii.   the explosive products and systems would comply with all relevant laws and regulations and the Supply Agreement (clause 14.1(c));

iii.   with respect to the Explosives Compound:

1.   the storage facility at the Explosives Compound would:

a.   be constructed and installed so that it would be fit for its intended purposes;

b.   be maintained so that at all times it would be fit for its intended purposes;

2.   the Explosives Compound would comply with all applicable licences, permits, consents authorisations etc; and

3.   the Explosives Compound would comply with all applicable laws and regulations (clause 14.1(d));

iv.   any plant or equipment to be utilised by Hanwha in the performance of its obligations under the Supply Contract would be fit for their intended purposes and comply with all relevant laws and regulations (clause 14.1(e));

…

k.   Hanwha was responsible for the safe and proper disposal of all waste (including any water and surface water or other material contained in any bunded areas) produced by the manufacture of the explosive products, the Explosives Compound, and in the performance of its obligations under the Supply Contract in accordance with all laws and regulations, Good Operating Practices, and the requirements of any authority and all reasonable requests of WCML (clause 30(a)).

56. The supply contract defined “Good Operating Practices” as:

the practices, methods and actions followed when a supplier undertakes its obligations:

1   in a sound and workmanlike manner;

2   with due care and skill;

3   using materials of new and merchantable quality and which comply with all applicable Laws and this Contract;

4   to the standard expected of an experienced and competent supplier;

5   in accordance with all applicable Laws; and

6   consistently with best practice for the delivery of products similar to the Products.

57. The explosives compound at the mine was located on the eastern boundary of the mine (“Hanwha Yard” below):

The Management of the Drainage Run-Off and EPBs at the Explosives Compound

58. Water run-off from the explosives compound was categorised as contaminated water and was required to be drained into the mine’s water management system.

59. At the time of the commission of the second and third offences on 8 February 2020, there was a bund around the internal perimeter of the explosives compound and drainage infrastructure in place to drain run-off from the explosives compound into a water dam on its southwestern side.

60. Representatives of MCC carried out a number of audits and inspections of the explosives compound including:

1. a General Environmental Inspection dated 22 September 2015;

2. an audit – Inspections Reports dated 22 September 2015;

3. a General Environmental Inspection dated 2 December 2015;

4. a monthly RMS Safety Inspection Sheet dated 25 July 2016;

5. a monthly RMS Safety Inspection Sheet dated 23 August 2016; and

6. a monthly RM Inspection dated 19 January 2017.

An Inspection by the EPA in 2018 Found Evidence of EPBs Discharge

61. On 8 August 2019 EPA Senior Operations Officer Simon Lund, together with MCC's Environmental Superintendent Emma Bulkeley and outgoing Maules Creek Coal Environmental Superintendent Scott Mitchell, conducted an inspection of the mine.

62. Lund inspected the explosives compound and observed that EPBs were escaping along two drainage lines running under the perimeter fence of the explosives compound and into a drainage channel that was located towards the roadway and which led into the sediment dams.

63. Lund observed that bunding around the explosives compound needed to be installed to stop the discharge of EPBs. He also identified that further action was required to clean up the EPBs around the compound.

64. Within days of Lund’s inspection, MCC:

1. scraped the area around the explosives compound with an excavator to collect the escaped EPBs;

2. adjusted the camber outside the north eastern boundary of the explosives compound;

3. reinstalled drainage around the outside of the explosives compound, including the re-establishment of bunds on the outside of the explosives compound; and

4. gave verbal directions to Hanwha personnel at the mine regarding the improvement of drainage, clean-up, handling and management of EPBs within the explosives compound.

65. As a result of MCC’s directions, Hanwha completed the following steps between August 2019 and February 2020, namely, it:

1. sealed holes in the EPBs containers that were stored in the explosives compound that had been caused by general wear and tear;

2. gave directions to the transporter of EPBs to the mine to improve the condition of containers in which EPBs were delivered to the mine;

3. placed additional screening around the EPBs loading station within the explosives compound to prevent EPBs being blown away while they were being loaded by an auger into mobile processing units; and

4. improved the internal explosives compound bunds and drainage system.

The Commission of the First Water Pollution Offence on 16 January 2021

66. The weather forecast for Boggabri on 16 January 2020 was for thunderstorms with a 90% chance of between 20 to 40 mm rain. For the month of January 2020 prior to the rainfall event on 16 January 2020, a total of 5.6 mm of rain only was recorded at the mine, with no individual rain event exceeding 2.8 mm.

67. On 16 January 2020 approximately 55.6 mm of rainfall was recorded between 1:30 pm and 5:15 pm at a rainfall station located 2.4 km northwest of the discharge location. Of that rainfall, 33 mm fell between 1:30 pm and 1:50 pm. Rainfall intensity peaked between 1:45 pm and 1:50 pm.

68. The rainfall intensities for durations between 10 minutes and 30 minutes had Annual Exceedance Probabilities (“AEP”) of approximately 3-4% which equated to a 1 in 25 to 1 in 33 years Average Recurrence Interval (“ARI”) event.

69. At the time of the rainfall on 16 January 2020, the subdrain had been constructed, maintained and desilted, and was operating to its design capacity.

70. During the rainfall event rehabilitated material (including topsoil and waste rock) on the NOEA was mobilised and washed into the subdrain built around the base of the NOEA. The subdrain commences to the south of the explosives compound, as marked with a brown line and identified as the “Dirty Water Drain for Sediment laden Water only”:

71. By approximately 1:40 pm that day, the material that washed into the subdrain caused its partial blockage, which in turn caused sediment laden water to overtop the subdrain (“the first discharge”) and flow across the adjacent paddock. That sediment laden water continued to flow beyond the boundary of the mine and discharged into Back Creek.

72. The duration of the overtopping of the subdrain was estimated to be for a period of 15 to 30 minutes between 1:45 pm and 2:15 pm. At approximately 2:15 pm, the flow in the subdrain scoured through the blockage and runoff ceased to overflow towards Back Creek.

73. The estimated duration of the overflow of the subdrain coincided with, and immediately followed, the peak rainfall intensity. Approximately 21.2 mm of rain was recorded during the period when the subdrain overflowed.

74. The first discharge into Back Creek did not occur from a licensed discharge point. Rather, it occurred approximately 1 km east of SD3 (see the image above).

75. WRM estimated that approximately 3 ML of sediment laden water overtopped the subdrain on 16 January 2020. In WRM's report (dated 22 January 2020) regarding the discharge into Back Creek, WRM estimated that approximately 25% of the runoff within the subdrain that overflowed at the blockage between 1:45 pm and 2:15 pm travelled north towards Back Creek. The remaining 75% of the runoff continuing to flow west towards SD3.

76. WRM estimated that approximately 1 ML of sediment laden water infiltrated the adjacent paddock and 2 ML of sediment laden water flowed into Back Creek. This estimate assumed that the overflow volume reached Back Creek within a discharge period of 30 minutes. If the travel time from the overflow location to Back Creek occurred over a longer duration, then the loss due to infiltration into the paddock would have likely been higher and less runoff would have reached Back Creek.

77. Based on the recorded flows at the water level gauge SW10 in Back Creek upstream of the overflow from the subdrain, WRM estimated that approximately 5.9 ML of runoff flowed past the mine in Back Creek between 1:45 pm and 2:15 pm. Therefore, the available dilution volume within Back Creek for the duration of the 30 minute overflow of the subdrain was approximately 3:1.

78. The Court viewed three videos recorded by MCC staff during the commission of the first offence. The videos clearly depicted sediment laden water flowing down from the NOEA and across the adjacent paddock towards Back Creek.

MCC Obtained Water Samples on 16 January 2020

79. Water samples were obtained by MCC on 16 January 2020 during the rainfall event. Curiously, results for water samples taken from Back Creek at locations upstream and downstream of the mine showed that levels of turbidity and TSS in Back Creek were lower downstream of the mine compared to upstream of the mine.

80. On 17 January 2020 further water samples were obtained by MCC during the rainfall event from the monitoring points identified in the EPL, as follows:

1. sample 200140-1 was collected from the same location as sample 200106-4 collected on 16 January 2020; and

2. sample 200140-2 was collected from the same location as sample 200106-3 collected on 16 January 2020.

MCC Reports the First Discharge

81. Bulkeley made the following report to the EPA Environment Line by telephone at 4:44 pm on 16 January 2020:

Due to severe storm in area there is potential uncontrolled discharge of sediment-laden water at a drainage area, with potential to enter Back Creek. Sediment-laden water is run-off from a rehabilitation area. This is a non-licensed discharge point. There has been about 50mm of rain in an hour. A crew were attempting to clear out the drain area to ameliorate the problem but have had to seek shelter due to continuing lightning activity and heavy rain.

82. Bulkeley also contacted Lund at 6:40 pm on that same day, first by phone call and then email. The email stated:

In follow up to the message I left you this afternoon Maules Creek Coal has initiated their PIRMP.

At approximately 2pm today 16th January a sub drain around the outside of the mine overtopped during a large rain event (approximately 40mm over 1hrs). This uncontrolled discharge resulted in sediment laden water being transported into Back Creek. Appropriate measures including sampling of discharge and receiving waters have been undertaken. Additional rain is predicted over the next couple of days and all measures will be undertaken to mitigate any further discharges from this drain.

In accordance with the PIRMP a detailed report will be provided of the incident within 7 days of occurrence of this incident.

I will contact you tomorrow to discuss the steps taken by site.

83. MCC provided an Environmental Event Report relating to the first discharge to the EPA within seven days of the event occurring.

The EPA Received a Complaint About the First Discharge from Druce

84. On 17 January 2020 the EPA received a complaint about the first discharge from a member of the public, Roselyn Druce. Druce’s email of complaint was as follows:

Official complaint of the Maules Creek Coal Mine releasing water into Back Creek after a rain event on the 16th January 2020, which I believe may have come about due to a levee bank failing to divert the water into the sediment dam near Back Creek, or run-off from the overburden below the sediment dam capture area…

As a concerned local I would ask that this incident be fully investigated, including Water sampling below the mine site.

85. Druce lives at 66 Teston Lane, Wongalea, Maules Creek, located adjacent to Back Creek and 7 km downstream of the mine.

Action Taken by MCC After the First Discharge

86. Between 16 January 2020 and 8 February 2020, MCC desilted and removed material from the subdrain that runs around the base of the NOEA, constructed a 0.5 m high bund on top of the southern embankment of the subdrain at the location where the subdrain overflowed and dewatered SD3 to increase its available capacity.

87. As at 16 January 2020 SD3 had a catchment area of 516 ha and a capacity of 170.8 ML. Records show that water was pumped out of SD3 and into the mine water dam as follows:

1. between 13 to 20 January 2020, 11.342 ML was pumped;

2. between 20 January to 3 February 2020, 23.174 ML was pumped; and

3. between 3 to 20 February 2020, 114.028 ML was pumped.

88. By 23 January 2020 SD3 had approximately 70% available capacity. On 23 January 2020 there was 2.4 mm of rain over the mine and the next day there was 12.4 mm rain.

89. A week after the event on 16 January 2020, MCC commenced desilting the subdrain using excavators and Moxy trucks to cart the silt to the top of the NOEA. This continued for approximately one month. However, no rehabilitation work was able to be undertaken on the NOEA between 16 January and 8 February 2020 due to inclement weather and the ground conditions being too wet to allow equipment to operate safely without damaging the slope or posing a risk to people operating the heavy machinery.

90. The mine received 6.6 mm of rain on 6 February 2020 and 14.4 mm on 7 February 2020. The rainfall on 6 February 2020 was the first rain recorded over the mine since 24 January 2020. A pre-rainfall inspection checklist dated 7 February 2020, stated that SD3 had approximately 40% capacity and was being dewatered.

91. On 28 January 2020 Lund and EPA Operations Officer Angus Adair attended the mine to inspect the location of the first discharge. Bulkeley and Ross Wilson, MCC’s Health, Safety and Environment Manager, also attended the inspection. Lund observed a large amount of sediment dispersed on the ground that had discharged from the subdrain and had deposited across the paddock and extending into Back Creek.

92. The EPA’s Inspection Report, dated 28 January 2020, stated as follows:

Drove to northern side of min, as we drove i notices that:

1.   The OB emplacement [NOEA] in at least three locations had serious gully erosion on them…

2.    significant amount of sediment had washed into the sub-drain along its length…

…at about 900m to the east of Sediment dam a large section of the OB emplacement [NOEA] had suffered from gully erosion and could see that a discharge had occurred at this point by the scouring on the far side of the sub-drain wall and the volume of sediment discharged across the paddock.

…We walked from the wall of the sub-drain across the paddock…The sediment in the paddock was the same colour and make up of the sediment on the OB emplacement [NOEA]… that ran for about 250 metres in length by about 400 to 500 metres wide…down to the creek, there was a wire fence that was confirmed as being the mine boundary. The sediment…ran under the fence and into Back Creek…

93. During the inspection the EPA officers took photographs. The Court was taken to a number of these images during the hearing to show the aftermath of the first discharge, the overflow into the adjacent paddock, and the overburdened sub-drain.

The Commission of the Second and Third Water Pollution Offences on 8 February 2020

94. The weather forecast for Boggabri on 8 February 2020, was thunderstorms with a 90% chance of between 10 to 20 mm of rain. However, approximately 96 mm of rain was recorded as falling at the mine that day at licenced monitoring point EPLW1.

95. Between 11:20 am and 2:20 pm, 83.6 mm of that rainfall fell. This event had an AEP of less than 1%, which is greater than a 1 in 100 ARI event.

96. During that rain event, in addition to sediment laden water, EPBs from the explosives compound mobilised and were deposited at off-site locations along the watercourse of Back Creek.

The Second Discharge

97. During the rain event material eroded off the NOEA and entered the subdrain at the base of the NOEA causing a partial blockage of the subdrain. The blockage caused sediment laden water to overtop the subdrain for a period of approximately 45 minutes between 2:15 pm and 3:00 pm and to flow across an adjacent paddock (“the second discharge”). The sediment laden water continued to flow beyond the boundary of the mine and discharged into Back Creek.

98. The second discharge did not occur from a licensed discharge point. It occurred close to the location of the first discharge.

99. WRM estimated that approximately 2.16 ML of sediment laden water overflowed into Back Creek. It estimated that around 10% of the runoff within the subdrain overflowed at the partial blockage between 2:15 pm and 3 pm and flowed north towards Back Creek. The remaining 90% of the runoff within the subdrain continued to flow west towards SD3.

100. Given the depth of rainfall prior to and during the drain overflow, WRM estimated that 100% of the water that overflowed the subdrain would have reached Back Creek.

101. Based on the recorded flows at the water level gauge SW10 in Back Creek upstream of the overflow from the subdrain, WRM estimated that approximately 61 ML of runoff flowed past the mine in Back Creek between 2:15 pm and 3:00 pm. Therefore, the available dilution volume within Back Creek for the duration of the 45 min overflow of the subdrain was approximately 28:1.

The Third Discharge

102. On 8 February 2020 sediment laden water and EPBs also discharged from SD3 (“the third discharge”). From 1:30 pm that day SD3 commenced overflowing into Back Creek and continued to overflow until 10 February 2020.

103. Over the preceding two days, that is between 1:30pm on 6 February 2020 and 4 pm on 7 February 2020, 21 mm rainfall was recorded at the mine. By 11:35 am on 8 February 2020 the rainfall recorded at the mine had surpassed 38.4 mm for a five day period. No discharge from the licenced discharge point at SD3 had occurred. Therefore, in that time period and in accordance with condition L2.5 of the EPL, MCC was permitted to exceed the TSS concentration limit specified for water discharged from SD3. This is what occurred from approximately 1:30 pm on 8 February 2020.

After 8 February 2020 MCC Obtained Additional Water Samples

104. During the rainfall event on 8 February 2020 and from 9 to 11 February 2020, MCC personnel collected water samples at a number of monitoring points. There were no EPBs in the samples.

105. No samples were taken from the wall of the subdrain where the overtopping occurred in respect of the second discharge because the discharge had ceased by the time that the MCC Environmental Superintendent attended the second discharge location.

The EPA Received a Second Complaint about the Second and Third Discharge Events

106. On 8 February at 8 pm, the EPA received a complaint by email from Druce that EPBs had washed down Back Creek and onto her property. The email was accompanied by photographs showing the overburdened Back Creek and embankments with EPBs discharge:

I am reporting an incident regarding the Whitehaven Coal Maules Creek Mine.

Back Creek has been contaminated by Flooding and overflowing of MCCM drill blast station, I believe that this has to be the source of contamination as I have found tiny Styrofoam balls that I believe is used in the blast holes and is most likely stored at this drill blast station.

…the site…was flooded and overflowed down the channel that extends around the north/eastern side of the mine and feeds into the sediment dam adjacent to Back Creek. This sediment dam has a discharge point above the dam which may have overflowed before any of the contamination from the drill blast station reached the sediment dam.

The property 'Wongalea' is approximately 7klms distance from the spill site, yet there was clear evidence that this contamination was collecting along the banks of the contour and flowing down with the rapidly moving water.

Back Creek feeds into Maules Creek at Harparary which then flows on to enter the Namoi River. I have labeled this on the Google map that I will send in the next email.

MCC Reported the Second and Third Discharge to the EPA

107. On 8 February 2020 Bulkeley made a report to the EPA as follows:

Telephone Recording

After hours call EPA106915. Overflow of a drain in a…[86mm] rain event…[Maules] Creek Coal Mine. Water into back creek for potentially 45 minutes. DO advised at 17:23, DO acknowledged at 17:56.

Email

This is a notification in accordance with Condition R2.1 of EPL 20221. During an extreme wet weather event of 186mm on the 8th February 2020 MCCM a wet weather discharge occurred from the sub drain on the northern end of the mine. It is estimated that the area discharged water for approximately 45minutes from approximately 14:15 – 15:00, this water reported to Back Creek which was in flood at this time. This event has been reported to the EPA hotline reference number #906035.

In accordance with Condition 2.2 a detailed report will be made available in 7 days.

108. The EPA was not advised that EPBs had been discharged in the 8 February 2020 notification. However, on the morning of 10 February 2020, Bulkeley made a further report to the EPA Environment Line reporting that:

Due to heavy rain and flooding staff have found likely impact to Back Creek from polystyrene balls used in blast product. The volume of balls lost is not known at present. Another storm is expected imminently - when safe to do so crew will inspect the waterway to identify mitigation measures if feasible.

109. MCC prepared Environmental Event Reports in relation to the second and third discharges and emailed them to the EPA on 14 February 2020.

Action Taken by MCC After the Second and Third Discharges

110. MCC engaged Golder to prepare a report following the rainfall event on 8 February 2020, Maules Creek Erosion Reivew [sic] following extreme rainfall in February 2020, dated 10 March 2020 (“the Golder Erosion Review”).

111. The issues addressed by the Golder Erosion Review relevantly included:

1. whether the NOEA performed reasonably in the circumstances and, considering the state of construction work, whether the storm on 8 February 2020 highlighted potential issues that needed to be addressed;

2. what could have been done to better manage the risks associated with extreme weather events during construction of the NOEA; and

3. what was the best strategy to cost-effectively repair the erosion damage given that access was constrained on some areas of the NOEA.

112. The Golder Erosion Review found that erosion on the NOEA had been exacerbated by:

1. the extreme rainfall;

2. the prolonged drought of the previous few years;

3. the fact that there was no vegetation on any of the rehabilitated areas;

4. the fact that the water management infrastructure on the NOEA was still largely under construction, notably:

1. no rock armouring in the drainage lines had been installed at the relevant time; and

2. the western drop structure had been shaped but not completed because no rock armouring had been installed;

5. the fact that topsoil had been stockpiled in two locations along the top of the NOEA extending across drainage lines and that this material had been washed out by the storm; and

6. the fact that the partial blockage and overflow of the subdrain on 8 February 2020 occurred at the base of the western drop structure, which had eroded significantly.

113. The Golder Erosion Review also noted that:

…the drop structures have eroded significantly in the lower extents with head cutting back upslope, particularly at the drain shown in Figure 2. This is not unexpected with the high velocities and tractive stresses requiring rock armouring. It seems likely that the lack of contour banks limited erosion further up the slope on this drain, with more significant head cutting extending upslope to the point where runoff from above the topsoil stockpiles would have concentrated and then drained into the drop structure.

114. Finally, the Golder Erosion Review recommended that the following could have been done to better manage risks associated with extreme events during construction of the NOEA:

…if not already part of the planning process, a risk assessment needs to feed into the construction planning process for those areas where the preferred sequencing cannot be implemented. Such a process may have resulted in a different sequence of construction on the WRD.

The EPA Inspected the Mine and Druce’s Property Following the Commission of the Second and Third Offences

115. On 10 February 2020 Lund and EPA Operations Officer Curtis Attard attended the mine and observed EPBs in puddles and drainage lines around the explosives compound and vegetation along the side of Back Creek.

116. The EPA officers took a number of photographs during the inspection. The Court was taken to three of these images which showed: the discharge point of the second offence; EPBs in Back Creek; and EPBs in a tree near the creek.

117. Attard and Lund inspected Druce’s property on 11 February 2022. They took photographs during this inspection. The photographs depicted EPBs in the vegetation of the levee bank and riverbanks of Back Creek.

118. The EPA also took water samples at the explosives compound on 10 February 2020 and at Druce's property on 11 February 2020.

WCL Directed Hanwha to Take Actions to Ensure That No Further EPBs Were Discharged

119. Following the release of the EPBs from the explosives compound on 8 February 2020, WCL directed Hanwha to:

a.    install the necessary plant, equipment and storage facilities at the Explosives Compound to control storage of the EPS balls (including setting out when that plant, equipment and storage facilities will be installed) and ensure no further EPS balls are released from the Explosives Compound;

b.   investigate other options rather than the use of EPS balls in the manufacture of its explosive products; and

c. deploy the necessary resources to assist Whitehaven and Maules Creek Coal in the clean-up activities required for Maules Creek Coal’s compliance with the First Clean-Up Notice.

120. In response to a statutory notice issued by the EPA to it, Hanwha produced the Hanwha Environmental Management Plan (“HEMP”), dated 7 March 2017.

121. The HEMP prepared pursuant to the supply contract, noted under the heading “environmental history” that there were several known events of EPB spills during windy conditions in October 2015.

122. The Aspects and Impacts Register in the Hanwha Environmental Management Plan recorded “significant aspects and impacts identified for the site”, which included:

EPS [EPBs] escape from loading container” which was identified as being very likely to occur without the controls specified in the Register and potential impacts being ”land contamination, impact to fauna and flora”.

…

EPS [EPBs] escape from shute into top of truck”, which was identified as being very likely to occur without the controls specified in the Register and potential impacts being “land contamination, impact to fauna and flora.

…

Rain/storm” involving “contaminated sediments leaving site boundaries due to rainwater” which was identified as being likely to occur without the controls specified in the Register and potential impacts being “land and groundwater contamination, impact to fauna and flora.

123. The EPA interviewed Derrick Henning, General Manager of Hanwha Mining Services NSW on 23 July 2020. Henning relevantly stated:

a.   When asked by the EPA in “terms of daily operation of the Compound…What responsibilities do Whitehaven have?”:

“Not, not, much at all. So, pretty much all the activities in the compound are managed by Hanwha.”

b.   When asked by the EPA “in terms of meeting Hanwha’s contractual obligations with Whitehaven. What processes are in place by Whitehaven to ensure that you guys are meeting their requirements?”:

“…a daily report…a weekly update, or a report and a monthly report as well…monthly management meetings and then quarterly meetings and a quarterly report…and we’re also required to report any incidences…into their INX system…any incidences that happen on the mine sit …we have our own INX system which is not linked to theirs but we…follow their process – their safety management process which we also – but we also follow ours so it's kind of a duplication but it's necessary”.

c.   When asked by the EPA “So, at the time when you noticed that what issues did you raise with Whitehaven in relation to that?:

“I didn’t raise any issues with Whitehaven…in hindsight I probably should have, I just figured we would clean it up…I was, I guess, ignorant of the extent of it and didn’t really appreciate the extent of it…”

d.   When asked by the EPA “So, in terms of those past practices [prior to Mr Henning starting with Hanwha on 16 September 2019] what were you told?”:

“I meant I didn’t see it but from what I’m being told and what’s been happening. Things have spilt well, we’ll get, get some more gravel and we just cover it over…it’s spilt a bit more gravel and cover it again it’s over…Whitehaven’s coming down for a visit just cover it over with gravel.”

e.   When asked by the EPA about the “work practice where EPS could escape from”:

“when the shipping containers backed up to the loading room…there were gaps between the shipping containers and outside…there was numerous leaks and holes…in the actual loading room.

…the auger where it goes out the bottom of the loading room…into the explosive’s truck…there was leaks…there’s a tube that hangs down off the auger and I asked…“What was the stuff on the floor?”…they said, “that dribbles out from the, from the auger sometimes”…actually just lift up the tube…to stop that from happening…a culture existed that wasn’t conducive to improving thing, there was no mindset around continuous improvement…it was just…this is what it is…we’ll get on and do…what we’ve always done.”

The EPA Issued Two Clean-Up Notices to MCC

124. On 21 February 2020 the EPA issued a Clean-Up Notice to MCC under s 91 of the POEOA (“the first Clean-Up Notice”).

125. The first Clean-Up Notice required MCC to, among other things:

1. take immediate action to ensure that no EPBs were located in any structure designed to carry water at the mine, as far as practicable, including, but not limited to, subdrains, stormwater drains and stormwater dams;

2. pump out SD3 and ensure that no EPBs were, as far as practicable, contained within it;

3. in order to ascertain the extent of the pollution incident:

1. within five days after receipt of the Notice, contact all downstream landowners neighbouring Back Creek to identify if these landholders had been impacted by the release of the EPBs;

2. within two days of any notifications provided to MCC by the landowners, attend the property and record the location, quantity, and area affected by EPBs;

3. identify potential clean-up options for properties where EPBs was identified; and

4. within five days of receipt of the Notice, contact the NSW Department of Industries – Fisheries to arrange an inspection of the reach of the Namoi River (known as the Namoi River Demonstration Reach) to determine if any EPBs had entered it and to determine any necessary clean-up actions.

126. MCC undertook the following actions in compliance with the first Clean-Up Notice:

1. it carried out works on all water carrying structures to remove all EPBs as far as practicable;

2. it pumped as much water as possible from SD3 and used machinery to scrape down the sides and remove all visible EPBs;

3. because small numbers of EPS were identified on properties adjoining Back Creek downstream of the mine, MCC continued along Back Creek at 51 different locations and recorded quantities of EPBs at each location ranging between “less than 5” to “greater than 200”; and

4. an inspection was undertaken of the Namoi River Demonstration Reach on 29 February 2020. No EPBs were identified.

127. MCC submitted its report on the activities undertaken by it in compliance with the first Clean-Up Notice to the EPA on 25 March 2020.

128. On 9 April 2020 following receipt of this report the EPA issued another Clean-Up Notice to MCC under s 91 of the POEOA (“the second Clean-Up Notice”). The second Clean-Up Notice required MCC, among other things, to:

By 5pm on 30 April 2020, the licensee must remove all EPBs from the locations identified in the maps marked Annexure A of this notice. The EPBs must be removed by walking those areas identified in the maps mark Annexure A of this notice, and only by using Blower Vacs to remove the EPBs.

129. MCC sent a letter to the EPA on 27 April 2022 requesting an additional methodology for the clean-up and a three month extension for its completion. The EPA approved the additional clean-up methodology in a letter to MCC on 1 May 2020.

130. On 12 and 14 May 2020 MCC provided the EPA with an update on the progress of its clean-up of the EPBs, including providing the EPA with maps of the locations of where EPBs had been located and the quantities of EPBs found at those locations. The quantity of EPBs was higher closer to the mine, with numbers decreasing towards Maules Creek. A single EPBs was located deposited approximately 8 to 10 km downstream of the mine in Back Creek, at its confluence with Maules Creek.

131. On 22 May 2020 the EPA issued a Variation of Notice of Clean-Up Action to MCC extending the time to 30 June 2020 to complete the clean up.

132. MCC completed the clean-up by 30 June 2020, and on 14 July 2020 provided the EPA with a Clean-up Validation Report setting out its clean-up works in the following relevant terms:

1) An initial sweep of the entire stretch of Back Creek from the Discharge Point to the Trentham Road Traveling Stock Route (TSR). Clean up works were undertaken in accordance with the Notice utilising blower vacs to vacuum and remove the EPBs.

2) Back Creek was then delineated into 100 meter segments. These transects were serviced by two crews of personnel whom undertook a focused clean of each individual area. By restricting clean up works into smaller areas, EPBs [EPS] have been able to be extracted to a reasonable and practicable extent.

3) Once standing water dried up, areas which were not originally accessible were cleaned of all visible EPB clusters.

4) Once the focused cleaning was completed additional sweeps were undertaken of the focus area. These sweeps were undertaken continuously until the time period outlined in the notice lapsed.

…Wongalea is the residence of the complainant. During the post clean-up inspection no EPBs [EPS] were discovered along the base of the levee bank on the property where they were found during the initial investigation…Significant quantities of EPBs [EPS] were removed…Due to the area becoming increasingly more vegetated throughout the process it was not always possible to inspect the ground thoroughly. Upon leaving the area no clusters of EPBs [EPS] were identified at the reported GPS points. The landholder met with representatives of Maules Creek Coal on 25 June 2020. Written acknowledgement was received stating the satisfactory completion of clean up works.

…The TSR is the located at the most westerly point of the clean-up works. The post clean-up inspection showed no EPB clusters at points 013B to 018B or 021B to 023B, as shown in figures 43 to 58 and figures 62 to 73…After the remediation of the points multiple walkthroughs of the areas were carried out. Additional small clusters of EPBs were found and removed. Upon leaving the TSR there were no clusters of EPBs [EPS] visible, however due to the area becoming heavily vegetated it was not always possible to inspect the ground thoroughly. Maules Creek Coal received notification on 17 June 2020 from a representative of North West Local Land Services to acknowledge acceptance of the clean-up works undertaken in the TSR.

…Blue Range is located to the East of Wongalea and is a Whitehaven owned Property...Cleaning has taken place along this property, before and after photographs of points 043B to 051B are shown in figures 153 to 192. Due to the area becoming increasingly more vegetated throughout the process it was not always possible to inspect the ground thoroughly. Upon leaving the area no clusters of EPBs were identified at the reported GPS points.

…Teston North is located to the east of Blue Range and is a Whitehaven owned Property. Cleaning has taken place along this property, before and after photographs of points 024B to 042B are shown in figures 74 to 152. Due to the area become increasingly more vegetated through the process it was not always possible to inspect the ground thoroughly. Upon leaving the area no clusters of EPBs [EPS] were identified at the reported GPS points.

…Marlow Downs is the property immediately to the west of the TSR and was included in the initial investigation for EPBs [EPS]. Less than five balls were discovered at two sites, 019B and 020B, these were collected at the time of the initial inspection. Because the balls were able to be collected, additional remediation work was deemed unnecessary at the points identified at Marlow Downs...

The EPA Issued a Statutory Notice Seeking Information and Records Relevant to the Second and Third Offences

133. On 14 May 2020 the EPA issued a statutory notice under s 191 of the POEOA seeking information and records relevant to the second and third discharges. In response to the request to provide information on how the EPBs escaped the explosives compound and travelled into Back Creek, MCC responded by stating that:

Windblown EPS [EPBs] were mobilised out of the RMS [the Explosives Compound], into the mine drainage system, which was then breached, resulting in loss of containment into Back Creek.

134. MCC personnel participated in recorded interviews with the EPA and made the following statements about EPBs in relation to the second and third discharges:

1. Bulkeley attended the location of the second discharge after the water had stopped discharging. She stated that she saw “a handful five to 10 range” of EPBs at the base of the levee running along the subdrain but that she did not think that EPBs had been mobilised in the overflow of the subdrain given the small number that she observed;

2. George Stevenson, who also attended the location of the second discharge after the water had stopped discharging, stated that he saw some EPBs in the “watermark” at the location where the subdrain overflowed and a “couple in the trash” in the paddock;

3. Matthew Smith observed “white poly balls” during the third discharge from the spillway located near SD3;

4. Jason Conomos, when asked about whether he had observed EPBs in the water at the location of the third discharge on 8 February 2020, said that he could not recall as there was a lot of debris. He could have, but did not make a specific note of them; and

5. when asked if he had seen any EPBs in the third discharge from the licensed discharge point, Christopher Walshe replied “I didn’t see any [EPBs]”.

The EPA Inspected the Mine on 23 June 2020

135. On 23 June 2020 Lund, and EPA Senior Investigators Catherine Stack and Stephen Knight, attended the mine to conduct an inspection. During the inspection they took a number of photographs, some of which the Court was directed to during the hearing. The photographs showed changes to the water management system infrastructure for EPBs loading.

136. Lund saw EPBs located in drainage lines, pipes, and on the nearby ground. He took photographs of the EPBs that he observed. He also noted that changes had been made to the explosives compound and NOEA since his inspection of the mine on 10 February 2020. In particular, he observed:

1. newly installed shade cloth covering the height of the perimeter fence;

2. a new bund inside the perimeter fence line;

3. drain more freely into a drain that ran into an existing mine water system dam located on the south-western side of the explosives compound;

4. re-grading of the land uphill from the explosives compound;

5. changes to the water infrastructure, including the installation of a new dam and pump infrastructure on the north-eastern side of the explosives compound to capture any runoff from around the outside of the explosives compound and direct it back to the mine water system;

6. re-grading of the NOEA to reduce its slope; and

7. installation of rock-lined drains on the NOEA.

The Causes of the Commission of the Offences

137. The offences were primarily caused by MCC not implementing sufficient erosion and sediment controls and by failing to prevent EPBs discharging from the spillway. The following factors contributed to the causes of the commission of the three offences:

1. MCC had not established vegetation on any part of the NOEA due, in part, to the drought;

2. erosion controls on the NOEA were still under construction at the time of the rainfall events on 16 January and 8 February 2020. In particular, the drainage structures on the NOEA had not yet been rock-lined resulting in the erosion of topsoil and overburden from those structures during the extreme rainfall events into the subdrain;

3. the topsoil was spread in concentrated flow paths on the NOEA;

4. the placement of topsoil stockpiles in concentrated flow paths and immediately adjacent to drain D1;

5. rip lines were not on the contour; and

6. MCC had failed to remove by means of contour ripping temporary access tracks and depressions formed by vehicle or machinery traffic.

138. There were two additional contributing causes to the commission of the first and second offences, either as a result of the partial blockage of the subdrain or as a consequence of the volume of sediment that was discharged from the subdrain, namely, that:

1. there had been prolonged drought conditions prior to 16 January 2020, from 2017 to 2020. The historical rainfall and streamflow data for Maules Creek indicated that the antecedent conditions in the vicinity of the mine prior to the three offences were dry. In particular:

1. taken further action to improve the NOEA after February 2022, including:

1. reviewed and improved windrows and drains on the active dump boundaries of the NOEA above the partially rehabilitated sections were to further reduce water flow into the partially rehabilitated sections of the NOEA;

2. improved water drainage so that water is now drained into multiple catchments to reduce concentration, facilitate water dispersion and reduce erosion;

3. installed additional minor rock drain structures to divert water around topsoil stockpiles; and

4. redesigned the drop structure entry on the head cut area of the northern slope to improve its approach into the subdrain and the structure fully rock lined; and

3. improved the handling and management of EPBs, namely, by inspecting the explosives compound on 29 October 2020 to confirm that WCL’s directions had been complied with by Hanhwa (see above). During the inspection Humphris observed improved bunds and drains in the explosives compound, the installation of a new shade cloth on the fence around the compound, a new vacuum system, and a new connection between the auger and the truck so that there was a sealed system between the storage container and the truck, for the loading of the EPBs.

213. I find this to be a genuine expression of contrition that I have taken into account.

Early Plea of Guilty

214. MCC entered a plea of guilty to all three offences at the earliest available opportunity. It is therefore entitled to the full 25% discount for the utilitarian value of its plea (ss 21A(3)(k) and 22 of the CSPA; R v Thomson; R v Houlton at [152]).

Assistance to the EPA

215. MCC provided assistance to the EPA in the investigation and prosecution of the offences (ss 21A(3)(m) and 23 of the CSPA) by:

1. providing timely responses to statutory notices for information and records;

2. voluntarily giving full and frank evidence; and

3. extensively participating in the preparation of a number of agreed statement of facts for the hearing thereby significantly reducing the duration of the sentence hearing.

Prior Convictions of MCC

216. On 25 November 2021 MCC was convicted and fined $187,500 by the Court for a breach of s 60A(2) of the Water Management Act 2000 relating to the taking of water from the Maules Creek Water Source without an access licence for that water source between about 1 July 2016 and 30 June 2019 (Natural Resources Access Regulator v Maules Creek Coal Pty Ltd [2021] NSWLEC 135). It was fined $187,500.

217. The EPA also sought to rely upon two penalty infringement notices issued to MCC. However, these notices are not prior convictions and their payment cannot be taken as an admission of liability pursuant to s 22A(2) of the Fines Act 1996 (see Barnes v O’Haire [2020] NSWLEC 158 at [154]). I have, therefore, placed no weight on them in this context.

The Good Character of MCC

218. Despite a prior conviction, I find that MCC is nonetheless of good corporate character. In his affidavit, Humphris detailed the extensive and important community work undertaken by MCC and WCL, MCC’s parent company, including the following projects:

1. investment in the employment, promotion and community engagement with First Nations People;

2. fostering greater employment and promotion opportunities for women;

3. investing in local skills development and prioritising local employment; and

4. financial contributions to local community projects since 2012, such as:

1. $73,000 to the Maules Creek Campdraft;

2. $46,100 to the Narrabri Rugby League Football Club;

3. $21,000 to the Nurruby Children’s Services;

4. $10,000 to the Narrabri RSL Sub-Branch; and

5. $77,578 to a range of childcare services, including Mary Rankin Childcare, Li’l Achievers Preschool and the Children’s Charity Network.

The Likelihood of MCC Reoffending

219. Because MCC is of good character, has demonstrated genuine contrition and remorse, and has put measures in place to prevent similar future offending, I find the likelihood that MCC will reoffend to be low.

Deterrence, Retribution and Denunciation

220. The Court is required to take into account both specific and general deterrence (Walden v Hensler [1987] HCA 54; (1987) 163 CLR 561 at 569-570 per Brennan J).

221. The penalty imposed by the Court must serve as a general deterrent (Axer at 359; Camilleri’s Stock Feeds at 701; and Bentley at [139] and see s 3A(b) of the CSPA). In Environment Protection Authority v Ballina Shire Council [2006] NSWLEC 289; (2006) 148 LGERA 278 Preston J discussed general deterrence in the context of sentencing for environmental crime as follows (at [65]-[68]):

65   The sentence of the Court is an important denunciation of the conduct of the defendant.

66   The sentence must also serve as a public deterrent. It is the duty of the Court to see that the sentence which is imposed will operate as a powerful factor in preventing the commission of similar crimes by those who might otherwise be tempted by the prospect that only a light punishment will be imposed: R v Rushby (1977) 1 NSWLR 594 at 597-598.

67   This factor is particularly relevant to environmental offences. Persons will not be deterred from committing environmental offences by nominal fines: Environment Protection Authority v Capdate Pty Limited (1993) 78 LGERA 349 at 354; and Director-General, National Parks and Wildlife v Wilkinson [2002] NSWLEC 171 (27 September 2002) at [85] and [93].

68   The deterrent effect of a fine must send an important message that laws requiring the conservation of the environment and compliance with approvals to carry out activities that may harm the environment, must be complied with. Also, the community must be satisfied that, by the Court’s sentence, the offender is given his just desserts.

222. The Court accepts that embedded in the determination of the appropriate sentence to be imposed on MCC must be an element of general deterrence to ensure that large scale mining projects operate in a manner that does not harm the environment, and in particular, do not pollute waters.

223. In relation to specific deterrence (s 3A(b) of the CSPA), the EPA submitted that specific deterrence is a relevant factor because:

1. MCC has a prior criminal conviction for an environmental offence;

2. MCC has a history of non-compliance with environmental regulations; and

3. MCC continues to operate the mine.

224. Notwithstanding that the extreme weather was a contributing factor in the commission of the offences and that MCC has since implemented extensive measures to ensure that future offending does not occur, I accept this submission for the reasons given by the prosecutor.

225. Finally, the Court must impose a sentence that achieves the purposes of denouncing the conduct the subject of the offence and making MCC accountable for its actions.

The Totality Principle

226. The totality principle is a relevant consideration when determining an aggregate penalty in sentencing for multiple offences (Mill v The Queen [1988] HCA 70; (1988) 166 CLR 59 at 62 to 63; Pearce v The Queen [1998] HCA 57; (1998) 194 CLR 610 at [40]; Johnson v The Queen [2004] HCA 15; (2004) 78 ALJR 616 at [18]; and Water NSW v Barlow [2019] NSWLEC 30; (2019) 244 LGERA 1 at [111]-[112]).

227. Because there are multiple offences arising out of the same, common or related conduct, the totality principle applies in the present case. The effect of the totality principle is to require the Court to review the totality of the sentence to consider whether the penalty imposed is just and appropriate and reflects the overall criminality of the offender before the Court.

228. Care must nevertheless be taken “to ensure that any adjustment of individual sentences does not cause the aggregate sentence not to reflect the total criminality of the offender’s conduct or the sentence for any individual offence to become disproportionate to the objective gravity of that offence” (Rawson at [222]; Gittany at [199] and [201]; R v Harris [2007] NSWCCA 130; (2007) 171 A Crim R 267 at [46]; and R v Wheeler [2000] NSWCCA 34 at [36]–[37]). The application of the totality principle must not cause public confidence in the administration of justice to be undermined by any perception that “what is in effect being offered is some kind of discount for multiple offending” (R v MAK; R v MSK [2006] NSWCCA 381; (2006) 167 A Crim R 159 at [18]). The Court discussed the totality principle and its application at length in Orica (at [224] to [229]). More recently see the examination and application of the principle in Barlow (at [111] to [112]).

Consistency in Sentencing

229. The task of the sentencing court is to seek even-handedness in the imposition of a sentence (R v Oliver (1980) 7 A Crim R 174 at 177 and R v Visconti [1982] 2 NSWLR 104 at 107). However, care must be taken in achieving consistency. There is always difficulty comparing the penalty in one case with that in another because of the wide divergence of facts and circumstances in each case (Axer at [365]). The sentence imposed in a single case does not demonstrate the limits of a sentencing court's discretion (Cabonne Shire Council v Environment Protection Authority [2001] NSWCCA 280;(2001) 115 LGERA 304 at [312] and Environment Protection Authority v Barnes [2006] NSWCCA 246 at [79]).

230. The EPA relied on seven comparable cases all relating to breaches of s 120(1) of the POEOA. MCC relied on one. They are summarised below:

1. Environment Protection Authority v Wambo Coal Pty Ltd [2017] NSWLEC 152, concerned the collapse of a dam wall, spilling sediment laden water into an ephemeral drainage line. The offence caused minor actual and likely environmental harm and the defendant failed to take practical measures to maintain the dam’s structural integrity. The defendant displayed contrition and remorse and implemented a number of measures to improve its environmental management practices. While the defendant had two prior convictions, they were not considered relevant. Because the defendant was charged with offences under both ss 120(1) and 64 of the POEOA, the Court fined it $42,000 for the s 64 offence (after discounting by 30% for an early guilty plea, among other mitigating factors) and $20,000 for the s 120(1) offence, applying the totality principle;

2. in Environment Protection Authority v Big Island Mining Pty Ltd [2014] NSWLEC 131, sediment-laden water from a mine was discharged in three separate incidents into a nearby creek during heavy rainfall events. The Court held that the harm caused by the commission of the offences was reasonably foreseeable, noting that Big Island Mining Pty Ltd (“Big Island Mining”) could have taken additional practical measures to minimise the harm. Pain J further held that the company had control over the commission over the offence notwithstanding that a contractor had failed to implement adequate erosion controls because Big Island Mining had supervisory control. Big Island Mining was charged with three offences under s 120(1) of the POEOA and was fined $103,000 in total (after discounting 35% for an early guilty plea and other mitigating factors);

3. in Environment Protection Authority v M A Roche Group Pty Ltd; Environment Protection Authority v Roche [2013] NSWLEC 191, sediment laden water was discharged into a creek on two separate occasions. While the Court found that the high turbidity of the water was likely to cause some harm to aquatic ecology, it determined that the harm during the commission of both offences was for a short time and in a limited area. The Court held that the extent of the environmental harm was low. However, there were a number of practical measures that the defendants could have undertaken to prevent the discharge of polluted water and the harm was considered reasonably foreseeable. In determining the appropriate sentence, the Court found that the defendants were of good character, were unlikely to reoffend and that they had very limited means to pay a fine. The penalty imposed was a fine of $5,000;

4. four separate discharges of sediment laden water in to a river, occurred in Environment Protection Authority v Moolarben Operations Pty Ltd [2012] NSWLEC 65. Although the Court emphasised that the potential impact on aquatic ecosystems should not be ignored, the environmental harm was at the lower end of the range of objective seriousness. Moolarben Operations Pty Ltd (“Moolarben”) had elected not to implement adequate erosion and sediment control measures despite a condition of its development approval requiring the implementation of an Erosion and Sediment Control Plan. Consequently, the Court held that the primary cause of the four water pollution events was within the control of Moolarben and that the resulting environmental harm was reasonably foreseeable. Mitigating factors included that Moolarben had pleaded guilty at the earliest opportunity, there was a genuine expression of remorse and that it had cooperated with authorities. In all of the circumstances, Moore J applied a 30% discount and imposed a fine of $105,000;

5. Environment Protection Authority v Ravensworth Operations Pty Ltd [2012] NSWLEC 222 dealt with a single offence of discharging sediment laden water from a mine by a pipe into a local creek. The Court accepted that the likely harm was low, given the short duration of the commission of the offence and its limited geographical impact. However, Pain J found that Ravensworth Operations Pty Limited (“Ravensworth”) ought not have allowed the pipe to be installed and that it had control over the causes of the offence. The Court further held that the harm arising from the commission of the offence was reasonably foreseeable. The Court accepted that the defendant had pleaded guilty at the earliest opportunity, was of good corporate character and had showed remorse. Ravensworth was fined $50,000;

6. in Environment Protection Authority v Centennial Newstan Pty Ltd [2010] NSWLEC 211, sediment laden water was discharged from a mine and into a tributary over four days. Craig J found that the offence was of moderate objective seriousness because the discharge had degraded the water quality of the creek, impacted aquatic ecosystems and had serious aesthetic consequences for the environment. It was accepted that the defendant could have taken a number of practical measures, including better controls and procedures for managing water at the mine, and that the harm was reasonably foreseeable. In relation to the subjective circumstances of the defendant, there was a prior conviction for a breach of s 120(1) of the POEOA but the defendant was of good character, had entered a guilty plea at the earliest opportunity, and had showed remorse. Craig J therefore determined that it was appropriate to apply a discount of 30%, resulting in a penalty of $105,000;

7. the decision of Environment Protection Authority v Fulton Hogan Pty Ltd [2008] NSWLEC 268; (2008) 163 LGERA 354 concerned the pollution of a river with sediment laden water during dam upgrade works. The defendant, Fulton Hogan Pty Ltd (“Fulton”), was a contractor to Snowy Hydro Ltd (“Snowy”). Both entities were prosecuted in separate proceedings. Fulton was found to have been complying with orders from Snowy when it committed the offence, however, the Court considered that Fulton ought to have been aware of its statutory obligations, particularly given that it was a term of the contract between Fulton and Snowy that Fulton was obliged to satisfy all legislative requirements, including complying with the POEOA. In addition, the offence caused actual environmental harm, albeit minor and of limited duration, and in already degraded waters. The defendant took a range of measures to prevent the harm, however, there were further measures available to it. The Court fined Fulton $100,000 after discounting mitigating factors, including a 25% discount for an early guilty plea; and

8. finally, the case of Environment Protection Authority v John Michelin & Son Pty Ltd [2019] NSWLEC 88 is also relevant, in my opinion. In that case, John Michelin & Son Pty Ltd (“Michelin”) discharged sediment laden water over three days into a table drain. The Court found that while Michelin could have taken further practical measures to avoid the harm, there were contributing causes to the commission of the offence outside of Michelin’s control, including that the stormwater system did not operate as intended. The environmental harm resulting from the commission of the offence was low, although the harm was reasonably foreseeable. Michelin demonstrated remorse, had assisted the EPA, entered an early plea of guilty and was unlikely to reoffend. The Court applied a discount of 33% and ordered Michelin pay $43,550.

231. The three offences before the Court are relatively comparable in their objective seriousness to those committed in the cases surveyed above except for Centennial Newstan, which was objectively more serious. Many of the subjective circumstances in mitigation present in this case were also present in the cases surveyed above.

Costs

232. The Court must take into account any costs order likely to be made in determining the appropriate penalty to be imposed (Harris at [100], Barnes at [78] and Environment Protection Authority v Causmag Ore Company Pty Ltd [2015] NSWLEC 58 at [123]). However, an order for costs does not result in a reduction in any monetary penalty imposed to an amount lower than that suggested by the general pattern of sentencing for the relevant offence (Liverpool City Council v Leppington Pastoral Co Pty Ltd [2010] NSWLEC 170 at [50]).

233. The parties have agreed that MCC is to pay the EPA’s legal and investigation costs. However, the parties agreed that MCC ought not to pay the legal cost of the two notices of motion filed by the EPA on 5 July 2021 and 1 October 2021, seeking extensions to the Court’s timetable (T22:32-36).

234. The EPA submitted that they have incurred approximately $300,000 in legal fees to date. Its investigation costs were fixed in the amount of $3,003.

235. It is therefore appropriate to take into account that MCC will pay investigation costs of $3,003 under s 248 of the POEOA and legal fees of approximately $300,000.

Appropriate Sentence

236. Having regard to the objective seriousness of the offences and the mitigating subjective factors of MCC, together with the penalties imposed in the relevant comparable cases, I find that the imposition of a monetary penalty is warranted for each offence as follows:

1. for the first offence a fine of $125,000;

2. for the second offence a fine of $75,000; and

3. for the third offence a fine of $75,000.

237. Each penalty must be discounted by 25% for the utilitarian value of MCC’s plea of guilty resulting in the imposition of a monetary penalty for each offence as follows:

1. for the first offence a fine of $93,750;

2. for the second offence a fine of $56,250; and

3. for the third offence a fine of $56,250.

238. After the application of the totality principle, the penalties for the commission of the second and third offences should be reduced to $40,000 and $25,000, respectively.

239. This brings the total penalty to $158,750.

Any Monetary Penalty to be Paid to the Environmental Trust

240. The EPA sought an order that any monetary penalty imposed by the Court be paid to the Environmental Trust pursuant to s 250(1)(e) of the POEOA. I consider that such an order is appropriate in all of the circumstances of this case.

Publication Order

241. Finally, pursuant to s 250(1)(a) of the POEOA, MCC has consented to a publication order being made. The terms of the publication order were, after some discussion, agreed and are set out in annexure A to this judgment.

242. Having regard to the circumstances of this case, I find that the making of a publication order to be appropriate (Environment Protection Authority v Ditchfield Contracting Pty Ltd [2018] NSWLEC 90 at [76] and Waste Recycling at [242]).

Orders

243. In conformity with the reasons given above, the Court makes the following orders:

In proceedings 9091 of 2021

1. Maules Creek Coal Pty Ltd is convicted of the offence against s 120(1) of the Protection of the Environment Operations Act 1997 as charged;

1. Maules Creek Coal Pty Ltd is fined the sum of $93,750;

In proceedings 9092 of 2021

3. Maules Creek Coal Pty Ltd is convicted of the offence against s 120(1) of the Protection of the Environment Operations Act 1997 as charged;

4. Maules Creek Coal Pty Ltd is fined the sum of $40,000;

In proceedings 9093 of 2021

5. Maules Creek Coal Pty Ltd is convicted of the offence against s 120(1) of the Protection of the Environment Operations Act 1997 as charged;

6. Maules Creek Coal Pty Ltd is fined the sum of $25,000;

In proceedings 9091 of 2021, 9092 of 2021 and 9093 of 2021

7. pursuant to s 250(1)(e) of the Protection of the Environment Operations Act 1997, Maules Creek Coal Pty Ltd is to pay the amount of $158,750 to the Environmental Trust within 28 days of the date of this order;

8. pursuant to s 248(1) of the Protection of the Environment Operations Act 1997, Maules Creek Coal Pty Ltd is to pay the Environment Protection Authority’s costs and expenses reasonably incurred during the investigation of the offences fixed in the amount of $3,002.70;

9. pursuant to s 257B of the Criminal Procedure Act 1986, Maules Creek Coal Pty Ltd is to pay the Environment Protection Authority’s professional costs as determined under s 257G of that Act;

10. pursuant to s 250(1)(a) of the Protection of the Environment Operations Act 1997, Maules Creek Coal Pty Ltd is, at its expense, to:

1. within 28 days of the date of this order, cause a notice of a minimum size as near as practicable to 180 cm² to be published within the first 11 pages of The Sydney Morning Herald, The Daily Telegraph, The Australian Financial Review and The Northern Daily Leader, with the text of such notice and the Whitehaven Coal logo (of reasonable size), to be as set out in annexure A to these orders;

2. within 28 days of the date of this order, cause a notice to be placed on the Whitehaven Coal Limited company website under the “News section” (“the website”) to be as set out in annexure A to these orders;

3. within 35 days of the date of this order provide to the Environment Protection Authority a copy of the entire page of each of The Sydney Morning Herald, The Daily Telegraph, The Australian Financial Review and The Northern Daily Leader and the website in which the notice was published; and

11. the exhibits are to be returned.

Annexure A – Terms of Publication Notice

Maules Creek Coal Pty Ltd is Convicted for Three Offences of Polluting Waters at Back Creek

Maules Creek Coal Pty Ltd (“MCC”) has been convicted by the Land and Environment Court of NSW (“the Court”) for having committed three offences against s 120(1) of the Protection of the Environment operations Act 1997 of having polluted waters. Two offences committed on 16 January and 8 February 2020, involved an amount of water containing sediment leaving the mine site and entering Back Creek. On 8 February 2020 the water that left the mine site and entered Back Creek contained some expanded polystyrene beads. At the time of the commission of the offences, expanded polystyrene beads were used in the preparation of explosives at the Maules Creek coal mine. MCC was prosecuted by the Environment Protection Authority (“the EPA”).

MCC cooperated with the EPA during the course of its investigation and pleaded guilty to each of the three charges.

The Court convicted MCC of each of the offences and ordered it to pay a total of $158,750 to the Environmental Trust, to pay the EPA's investigation costs fixed in the amount of $3,003, and in addition, to pay the EPA’s legal costs as agreed or assessed. MCC was also ordered to publish this notice at its own expense.

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Amendments

05 April 2022 - Update the year of the proceedings in the Orders to identify the correct year.

06 April 2022 - Paragraph 243 of Environment Protection Authority v Maules Creek Coal Pty Ltd [2022] NSWLEC 33 has been amended pursuant to r 36.17 of the Uniform Civil Procedure Rules 2005 on 5 and 6 April 2022.

Decision last updated: 06 April 2022