Environment Protection Authority v Whitehaven Coal Mining Limited

[2019] NSWLEC 27

Land and Environment Court

New South Wales

• Amendment notes

Medium Neutral Citation:	Environment Protection Authority v Whitehaven Coal Mining Limited [2019] NSWLEC 27
Hearing dates:	13 March 2019
Date of orders:	18 March 2019
Decision date:	18 March 2019
Jurisdiction:	Class 5
Before:	Pepper J
Decision:	See orders at [277].
Catchwords:	ENVIRONMENTAL OFFENCES: plea of guilty by a company to offence of contravening a condition of its environment protection licence – sentencing principles – determination of the objective seriousness of the offence – consideration of the subjective circumstances of the defendant – use of and weight to be given to the good character of an environmental offender - examination of comparable cases – purpose of a publication order – manner and extent of publication notice – publication order made – monetary penalty imposed.
Legislation Cited:	Crimes (Sentencing Procedure) Act 1999, s 3A Criminal Procedure Act 1986, ss 257B, 257G Environmental Trust Act 1998 Protection of the Environment Operations Act 1997, ss 64, 129(1), 148, 250(1)(e)
Cases Cited:	Axer Pty Ltd v Environment Protection Authority (1993) 113 LGERA 357 Bentley v BGP Properties Pty Limited [2006] NSWLEC 34; (2006) 145 LGERA 234 Cabonne Shire Council v Environment Protection Authority [2001] NSWCCA 280; (2001) 115 LGERA 304 Cameron v The Queen [2002] HCA 6; (2002) 209 CLR 339 Camilleri's Stock Feeds Pty Ltd v Environment Protection Authority (1993) 32 NSWLR 683 Cessnock City Council v Quintaz Pty Limited; Cessnock City Council v McCudden [2010] NSWLEC 3; (2010) 172 LGERA 52 Chief Executive, Office of Environment & Heritage v Orica Pty Ltd; Environment Protection Authority v Orica Pty Ltd [2015] NSWLEC 109 Chief Executive, Office of Environment and Heritage v Rummery [2012] NSWLEC 271; (2012) 192 LGERA 314 Dyno Nobel Asia Pacific Pty Ltd v Environment Protection Authority [2017 NSWCCA 302 Elias v The Queen [2013] HCA 31; (2013) 248 CLR 483 Environment Protection Authority v Ardent Leisure Ltd [2018] NSWLEC 36 Environment Protection Authority v Barnes [2006] NSWCCA 246 Environment Protection Authority v Caltex Australia Petroleum Pty Ltd [2017] NSWLEC 8 Environment Protection Authority v Centennial Newstan Pty Ltd [2010] NSWLEC 21 Environment Protection Authority v Ditchfield Contracting Pty Ltd [2018] NSWLEC 90 Environment Protection Authority v Dyno Nobel Asia Pacific Pty Ltd [2017] NSWLEC 64 Environment Protection Authority v Elf Farm Supplies Pty Ltd [2017] NSWLEC 60 Environment Protection Authority v Environmental Treatment Solutions Pty Ltd [2015] NSWLEC 160 Environment Protection Authority v Hanna [2018] NSWLEC 80 Environment Protection Authority v Hunter Valley Energy Coal Pty Ltd [2015] NSWLEC 120 Environment Protection Authority v Huntsman Corporation Australia Pty Ltd [2011] NSWLEC 39 Environment Protection Authority v Incitec Ltd [2003] NSWLEC 381; (2003) 131 LGERA 176 Environment Protection Authority v Morgan Cement International Pty Ltd [2016] NSWLEC 140 Environment Protection Authority v Nulon Products Australia Pty Ltd [2015] NSWLEC 153 Environment Protection Authority v Orica Australia Pty Ltd (the Nitric Acid Air Lift Incident) [2014] NSWLEC 103; (2014) 206 LGERA 239 Environment Protection Authority v P & M Quality Small Goods Pty Ltd; Environment Protection Authority v JBS Australia Pty Limited [2017] NSWLEC 89 Environment Protection Authority v Robinson [2004] NSWLEC 629 Environment Protection Authority v Wambo Coal Pty Ltd [2016] NSWLEC 125 Environment Protection Authority v Waste Recycling and Processing Corporation [2006] NSWLEC 419; (2006) 148 LGERA 299 Environment Protection Authority v Wattke; Environment Protection Authority v Geerdink [2010] NSWLEC 24 Environmental Protection Authority v Causmag Ore Company Pty Ltd [2015] NSWLEC 58 Harris v Harrison [2014] NSWCCA 84; (2014) 86 NSWLR 422 Hoare v The Queen [1989] HCA 33; (1989) 167 CLR 348 Liverpool City Council v Leppington Pastoral [2010] NSWLEC 170 Markarian v The Queen [2005] HCA 25; (2005) 228 CLR 357 Morton v R [2014] NSWCCA 8 Mouawad v The Hills Shire Council [2013] NSWLEC 165; (2013) 199 LGERA 28 Muldrock v The Queen [2011] HCA 39; (2011) 244 CLR 120 Newcastle City Council v Pace Farm Egg Products Pty Ltd [2002] NSWLEC 66 Newcastle Port Corporation v MS Magdalene Schiffarhtsgesellschaft MBH; Newcastle Port Corporation v Vazhnenko [2013] NSWLEC 210 Obeid v R (No 12) [2016] NSWSC 1815 Plath v Fish; Plath v Orogen Pty Ltd [2010] NSWLEC 144; (2010) 179 LGERA 386 Plath v Rawson [2009] NSWLEC 178; (2009) 170 LGERA 253 R v Dodd (1991) 57 A Crim R 349 R v Kennedy [2000] NSWCCA 527 R v MacIntyre (1988) 38 A Crim R 135 R v Nichols (1991) 57 A Crim R 391 R v Oliver (1980) 7 A Crim R 174 R v Visconti [1982] 2 NSWLR 104 Ryan v The Queen [2001] HCA 21; (2001) 206 CLR 267 Veen v The Queen (No 2) [1988] HCA 14; (1988) 164 CLR 465 Veen v The Queen [1979] HCA 7; (1979) 143 CLR 458 Walden v Hensler (1987) 163 CLR 561 Weininger v The Queen [2003] HCA 14; (2003) 212 CLR 629 Wong v The Queen [2001] HCA 64; (2001) 207 CLR 584
Texts Cited:
Category:	Sentence
Parties:	Environment Protection Authority (Prosecutor) Whitehaven Coal Mining Limited (Defendant)
Representation:	Counsel: Mr P English (Prosecutor) Mr T Howard SC (Defendant)   Solicitors: Environment Protection Authority (Prosecutor) Ashurst (Defendant)
File Number(s):	2017/241343
Publication restriction:	N/A

Judgment

Whitehaven Pleads Guilty to Contravening a Condition of its Environment Protection Licence

1. Whitehaven Coal Mining Limited (“WCM”) has pleaded guilty to an offence against s 64(1) of the Protection of the Environment Operations Act 1997 (“POEOA”). WCM is charged with contravening condition 01.1 of environment protection licence (“EPL”) 12870 on or about 10 August 2016, at or near Wean Road, Gunnedah in New South Wales (“the licensed premises”).

2. The Further Amended Summons stated as follows:

1.    An order that the defendant, Whitehaven Coal Mining Limited (ACN 086 426 253) whose registered office is at Level 28, 259 George Street, Sydney NW 2000, appear before a Judge of the Court to answer the charge that on or about 10 August 2016, at or near Wean Road, Gunnedah, in the State of New South Wales (Licensed Premises), it committed an offence against section 64(1) of the Protection of the Environment Operations Act 1997 in that it was the holder of licence, a condition of which was contravened by a person.

Particulars

a.   Licence

Environment Protection Licence Number 12870.

b.   Licence condition contravened

Condition 0.1.1, which states: “Licensed activities must be carried out in a competent manner. This includes:

(a)   The processing, handling, movement and storage of materials and substances used to carry out the activity, and

(b)   The treatment, storage, processing, reprocessing, transport and disposal of waste generated by the activity.”

c.   Manner of breach

The Defendant failed to carry out its licensed activities at the Licensed Premises in a competent manner, in that it conducted a blast, namely blast RG16_0713_RL240 in a less than competent manner in that:

i.   the blast was carried out without a written risk assessment being undertaken;

ii.   the blast was carried out using explosive products that did not reduce to the greatest extent the risk of blast fume generation in the conditions;

iii.   8.5% of blast holes were overloaded with explosives;

iv.   there were several departures from provisions contained in internal blast management plans;

v.   a neighbouring property owner was not notified when the fume moved offsite and

As a consequence, the defendant failed to minimise air pollution.

2.    An order that the Defendant be dealt with according to law for the commission of the above offence.

3. Such orders pursuant to section 8.3 of the Protection of the Environment Operations Act 1997 as the Court in its discretion see fit to make.

4.    An order that the Defendant pay the Prosecutors costs.

3. Section 64(1) of the POEOA relevantly provides that:

(1)   Offence If any condition of a licence is contravened by any person, each holder of the licence is guilty of an offence.

Maximum penalty:

(a)   in the case of a corporation—$1,000,000 and, in the case of a continuing offence, a further penalty of $120,000 for each day the offence continues…

4. The charge relates to a mine blast (“the blast”) that occurred at Rocglen Coal Mine (“Rocglen Mine”) at 12:00pm on 10 August 2016, which emitted blast fumes outside of the licensed premises (“the blast incident”).

5. Most of the factual matters in dispute were resolved by the filing of a detailed statement of agreed facts that appended codes of practice, reports, photographs, records and maps, and generally set out the complex factual matrix surrounding the commission of the offence.

The Licensed Premises at Which the Blast Incident Occurred

6. WCM is a wholly owned subsidiary of Whitehaven Coal Limited (“WCL”). WCM owns and operates Rocglen Mine. Rocglen Mine is an open-cut coal mine situated at Wean Road, approximately 28 km north of Gunnedah in the north east of NSW. Rocglen Mine is one of three open cut coal mines operated by subsidiaries of WCL (collectively, “the Gunnedah Operations”). The other two mines comprising the Gunnedah Operations are Tarrawonga Coal Mine (“Tarrawonga”) and Werris Creek Coal Mine (“Werris Creek”).

7. WCM is the holder of EPL 12870 in respect of Rocglen Mine. The scheduled activities on the EPL are coals works (0 - 2,000,000 tonnes annual handling capacity) and mining for coal (greater than 50,000 - 2,000,000 tonnes annual production capacity).

8. The licensed activity includes the removal of the material overlaying a coal seam (“overburden”) to enable the mining of coal seams beneath. The removal of the overburden involves the use of explosives.

9. The process of preparing an area of overburden for explosion and exploding it through the detonation of explosives is referred to as drilling and blasting. Each drill and blast event is usually conducted by a drill and blast crew under the supervision of a drill and blast engineer.

10. Following blasting, the overburden is loaded by an excavator into a truck and removed. The coal is then mined, stockpiled and transported by road to a coal handling preparation plant in Gunnedah (which is also owned and operated by WCM), where it is processed prior to being loaded for transportation to the Port of Newcastle.

11. Associated activities such as pit dewatering, water storage and rehabilitation works are also undertaken at Rocglen Mine. WCM is authorised to produce up to 1.5 million tonnes of run of mine coal from Rocglen Mine every calendar year.

Personnel Involved in the Blast Incident

12. At the time of the blast incident, the General Manager of the Gunnedah Operations, including Rocglen Mine, Mr Nigel Wood, reported and communicated daily with Mr Jamie Frankcombe, the Chief Operating Officer of WCL.

13. The day to day operations of Rocglen Mine (including the management of health, safety and environmental issues) were overseen by the Operations Manager, Mr Jason Conomos. Mr Conomos reported to Mr Wood on a weekly basis.

14. The other relevant personnel of WCM involved in the blast were as follows:

1. Mr Graham Cope – WCL’s drill and blast engineer, and drill and blast manager. His principal duties (which extended to Rocglen Mine) included designing blasts and ordering the required explosives from the explosive supplier, Low Density Explosives Corporation Australia (“LDE”). Mr G Cope has held a blasting explosives user licence (shot-firers certificate) since the mid-1980s and has been designing blasts since the late 1990s. He has 30 years of experience in the mining industry. At the time of the blast incident, Mr G Cope was also the supervising drill and blast engineer for Werris Creek and Tarrawonga;

2. Mr Paul Wicks – who was employed by WCM as an operator and a shot-firer for Rocglen Mine and Tarrawonga. He was the senior shot-firer of the blast. The other shot-firers for the blast were Mr Jamie Southwood and Mr Jeremy McKay;

3. Mr Alvin Cope – who was employed by WCM as a shot-firer for Rocglen and Tarrawonga Mines. He was also involved in the blast incident as supervisor to Mr Wicks. Mr A Cope also worked for WCM as a Step Up. Mr A Cope’s role as Step Up involved managing the people that were involved in a blast, however, this role did not relate to the blast design or technical advice. Mr A Cope had around 30 years of experience working as a shot-firer in the NSW mining industry; and

4. Ms Madeline Whitten – Rocglen Mine’s Environmental Graduate who reported to Mr Conomos. Ms Whitten was present at the time of the blast. Her duties included monitoring environmental conditions prior to the shot being fired (including wind conditions), completing an environmental blast checklist, providing environmental information to the Operations Manager, and participating in monitoring and assessing any fume cloud.

15. At the time of the blast Ms Whitten was positioned on Wean Road with Mr Conomos and Mr G Cope. Ms Whitten took photographs of the blast (including the fume) and completed the environmental blast checklist.

16. LDE supplied the explosives products to a number of WCL’s operations including Rocglen Mine. The relevant personnel of LDE for the blast were:

1. Mr Stuart Parsons – the Principal Mining Engineer for LDE. Mr Parsons is based in Perth and was not present at Rocglen Mine at the time of, or prior to, the blast incident;

2. Mr Jason Rock – a Technical Specialist for LDE based in Gunnedah. Mr Rock was not in attendance at Rocglen Mine at the time of, or prior to, the blast incident;

3. Mr Martin McDonald – Tarrawonga Site Supervisor for LDE, a role which included supervision of the mobile mixing unit (“MMU”) operators involved in loading the explosives used in the blast. Mr McDonald was onsite at Rocglen Mine on the morning of 8 August 2016 for one to two hours, but was otherwise not onsite on 9 or 10 August 2016; and

4. Mr Robin Burns - engaged by LDE as a MMU operator. Mr Burns loaded the explosives used in the blast incident.

Policies and Procedures in Effect at the Time of the Blast Incident

17. Blasting occurs at Rocglen Mine approximately three to four times per month. Blasting operations at Rocglen Mine are the subject of a number of management plans some of which, pursuant to the terms of the mines overall planning approval, required approval from the Department of Industry Division of Resources and Energy.

18. The principal plans and operating procedures relating to blasting activities in place at Rocglen Mine at the time of the blast incident were:

1. the WCM Blast Management Plan, dated 17 February 2016 (“the Blast Management Plan”);

2. the Rocglen Coal Mine Blast Fume Management Procedure, revised on 12 February 2015 (“the Blast Fume Management Procedure”);

3. the Whitehaven Coal Procedure - Blasting Clearance and Firing, revised on 12 December 2014 (“the Blasting Clearance and Firing Procedure”);

4. the Whitehaven Coal Procedure - Loading and Stemming Blast Holes, revised on 12 December 2014 (“the Loading and Stemming Blast Holes Procedure”); and

5. the Whitehaven Coal Procedure - Planning Design and Record Keeping, revised on 12 December 2014 (“the Planning Design and Record Keeping Procedure”).

19. The Blast Management Plan and the Blast Fume Management Procedure are plans specific to Rocglen Mine, whereas the other plans listed above are applicable to all of WCL’s operations. The Blast Management Plan is required to be prepared to the satisfaction of the Secretary of the Department of Planning and Environment (“the Department”) pursuant to condition 12 in Schedule 3 of the Project Approval 10_0015 for Rocglen Mine (“the project approval”).

20. Condition 12 of the project approval relevantly stated that:

The Proponent shall prepare and implement a blast Management Plan for the project to the satisfaction of the Secretary. This plan must:

(a)   be prepared in consultation with the EPA, and submitted to the Secretary for approval by the end of December 2011;

(b)   describe the measures that would be implemented to ensure compliance with the relevant conditions of this approval; and

(c)   include a blast monitoring program to evaluate the performance of the project.

21. The above plans incorporated and referenced the Australian Explosives Industry and Safety Group Inc Code of Practice – Prevention and Management of Blast Generated NOx Gases in Surface Blasting (“the AEISG Code”). At the time of the blast incident, WCM was aware of the existence of and had regard to the AEISG Code as the relevant practice standards for Australia and New Zealand.

22. Documents prepared as part of the blasting process at Rocglen Mine included the use of blast scheduling, explosives orders, drill logs, blast logs, pre-blast inspections and sign off, shot-firers records and blast patterns (“blast pack”).

23. In addition to a Blast Management Plan covering the Rocglen mining operations generally, WCM also required an individual plan for each blast. The individual plan comprised the documents included in a blast pack. Documents were progressively added to the blast pack up until the blast taking place, with some documents being added following the blast.

Policies and Procedures Relevant to the Blast Design

24. The general area to be blasted within Rocglen Mine (including the precise location within the mine pit, the blast size and general timing) was determined by the overall works schedule for Rocglen Mine, and was usually coordinated by Mr Conomos. This level of planning involved input from mining engineers, geologists and personnel involved in logistics and business planning.

25. Once the area to be blasted was identified at Rocglen Mine, the design of the individual blast (“the blast design”) was undertaken by the drill and blast engineer.

26. Generally speaking, the blast design involved the following first steps:

1. the identification of an appropriate location, burden and spacing, depth of the holes drilled into the area to be blasted;

2. the nomination of the burden;

3. the choice of explosives;

4. the creation of a shot pattern (a map marking out the features outlined in (a)); and

5. consideration of previous blasts (including similar geology, entry levels and fume, noise and vibration).

27. The drill and blast engineer then provided the blast design for review to both the Mine Operations Manager and Operations Manager. The blast design was prepared in the form of both an electronic copy, which was usually saved on the computer of the drill and blast engineer, and a hardcopy which was placed in the blast pack for each individual blast.

28. The shot pattern (or drill pattern) was provided to the shot drillers so they could drill holes in the bench (the surface of the area to be blasted into which explosives could subsequently be loaded).

29. The drilling instructions could additionally include a requirement for the drillers to drill deeper in some locations, or after a certain number of holes, in order to assist in confirming the geological model for Rocglen Mine.

30. The drill and blast engineer was also involved in planning for the loading of the shot pattern. In addition to prescribing which type of explosive was to be used, the drill and blast engineer’s design would include:

1. the quantity of explosive to be used in each individual hole;

2. the powder factor of the blast;

3. whether gas bags need to be used (a gas bag is a pressurised bag used to control the height at which explosives and stemming are placed in individual drilled holes);

4. the amount of stemming to be used (material placed in the drilled holes over the explosives); and

5. the method, timing, and sequence, of the ignition process used in the blast.

31. When designing the blast the results of previous blasts in the location were generally taken into consideration to assist in determining the explosive product to be used and the powder factor required to achieve the desired degree of fragmentation.

31. Powder factor refers to the quantity of explosive required per one cubic metre of rock to achieve the desired fragmentation of the substance being blasted. The higher the strength of the ground to be blasted, the greater the powder factor.

32. Generally speaking, when designing a blast the aim is to achieve the optimum fragmentation of the material being blasted by the most efficient means possible, and to minimise blast induced nuisances such as fume, overpressure, and vibration.

33. In addition to the blast pattern being provided to the drillers so that the individual holes could be drilled across the bench, the blast design was provided to the shot-firers to implement the design and carry out the blast.

34. WCM employed a number of personnel who held blasting explosives user licences (shot-firers certificate). Shot-firers certificates are endorsed by the New South Wales Coal Mines Qualification Board (now the Mining and Petroleum Competence Board) and are issued by SafeWork NSW.

35. Qualification for the certificate requires a person to demonstrate knowledge and competency in the use of explosives and the legislation regulating explosive use in mining operations.

36. The principal shot-firer for the blast was Mr Wicks. Mr A Cope, Mr Southwood and Mr McKay also worked as shot-firers for the blast.

37. The work of the shot-firers included:

1. checking the condition and depth of each drilled hole by dipping the hole before it is loaded with explosives;

2. instructing LDE’s MMU operator as to the explosive to be delivered;

3. observing the MMU operator introduce the explosive into the holes;

4. checking that the column rise, that is, the amount loaded, is correct; and

5. ensuring that the hole is correctly stemmed.

39. The Loading and Stemming Blast Holes Procedure required that:

Bulk explosives trucks are to deliver explosive blends as specified in the load sheets, or as requested by the Shotfirer to suit blast hole conditions,…. The operator will record density checks and delivered quantities for each load, as part of the QA/QC process, and ensure delivery systems are periodically calibrated as specified in the supply contract. The operator must subsequently supply a loading docket, with density check values, to verify the quantities loaded.

40. The supply of explosives by LDE to Rocglen Mine was subject to the Master Services Agreement between LDE and WCM dated 21 October 2013 (“the LDE supply contract”).

41. The LDE supply contract contained a services schedule which, among other things, defined the respective responsibilities of LDE and WCM in respect of activities associated with a blast. The majority of activities in the services schedule are shown as being the responsibility of WCM. Responsibility for "mixing and delivery of bulk explosives down blastholes" was the responsibility of LDE.

42. Part of the blast design involves creation of load sheets which set out the amount of explosive to be loaded into each hole. The drill and blast engineer also provided the shot-firer with a tie-up sheet and the shot-firers used this to ensure that the individual explosive loaded columns were wired in accordance with the design for the ignition sequence.

43. Prior to a blast taking place, the Mine Operations Manager considered the establishment of a safety or exclusion zone and the placement of sentries to enforce the zoned areas.

44. The Environment Officer was also involved in the notification of neighbours or the notification of the Council of the need to block private or public roads. The Environment Officer also monitored the weather conditions to ensure that the blast could proceed safely. This included monitoring the wind conditions at the licensed premises in order to minimise the risk of any blast fume moving offsite.

The Relevant Consultation Processes between Drillers, Shot-firers and Blast Engineers When Blast Holes Are Drilled

45. If ground conditions encountered when drilling are different from the expected geological model, the drill and blast engineer consult with the shot-firers about the information collected from drilled blast holes in order to consider whether the blast design required changes (for example, whether the ground condition, or condition of the drilled holes, require that changes be made to the type or quantity of explosive).

46. Information regarding the ground conditions is captured by the drillers in drill logs. WCM’s processes required the drill and blast engineer to review the drill logs containing information about the holes. However, it was not uncommon for the shot-firer not to see the drill logs prior to a blast.

Assessment of the Blast Holes Prior to the Loading of Explosives

47. After the individual blast holes had been drilled, but prior to explosives being loaded, the individual blast holes were dipped by the shot-firer. The dipping process employed at Rocglen Mine was to use a weighted tape measure to measure various characteristics of each drilled hole, namely:

1. the depth of the hole that existed post drilling (to ensure that the hole has been drilled to the correct depth or to ensure that any change in depth could be factored into the design of the blast);

2. if there was water or mud in any of the holes, and if so how much; and

3. the condition of the walls of the holes (whether, for example, the hole had wet or damp walls).

48. Following the assessment of the drilled holes, explosives were loaded and the drilled holes were stemmed and wired for detonation.

Supply of Explosives for Rocglen Mine

49. Because Rocglen Mine did not have an explosives storage facility, explosives were transported to Rocglen Mine directly from LDE’s supply sources at Blackwater in Queensland or Kooragang Island near Newcastle, in advance of each blast.

50. Bulk explosives for each blast ordered by WCM were brought to Rocglen Mine in LDE’s tankers or trucks and the raw explosive product was then loaded into LDE’s MMUs operated by LDE staff, which enabled the mixing of the explosives at Rocglen Mine.

51. The MMU was driven to the area of the bench where drill holes were to be filled. A computer system was used to program the type and quantity of explosive to be delivered. The explosive was then fed from the MMU into each blast hole, which was then stemmed by the shot-firers.

52. Under the arrangement between WCM and LDE, WCM paid demurrage in the event that:

1. trucks loaded with LDE explosives were returned with explosives unused; or

2. unloading of explosives from trucks was delayed and turnaround times were extended.

53. The standard practice at Rocglen Mine was for explosives to be ordered the week prior to a blast occurring, usually on the Thursday of that week.

54. LDE’s MMU operators were advised by WCM’s shot-firers of what mixture of explosive products were required and in what quantities (depending on the bulk materials supplied and present at Rocglen Mine).

55. Once on the bench, the shot-firer provided instructions to the LDE operator and the LDE operator then augured explosives into each drilled hole as instructed by the WCM shot-firer.

56. Mr Rock, who was ordinarily based in Gunnedah, was available on request to travel to Rocglen Mine to provide technical information to the shot-firer.

57. LDE also produced a number of technical data sheets for their explosive products including heavy ammonium nitrate fuel oil (“ANFO”) products, XLoad products, and GPE70 products. The technical data sheets for these products were held by WCM at the time of the blast incident.

58. LDE has been supplying WCL’s operations with explosives since 2014, and WCL have knowledge of, and experience in, the use of all of LDEs explosives products across all of its sites, including at Rocglen Mine.

59. Mr G Cope and Mr Wicks were provided with technical information regarding LDE’s explosive products, including HiDex, GPE70 and XLoad products, and had seen the technical data sheets for those products.

60. Mr A Cope had seen the technical data sheets for HiDex and GPE70.

61. There are a number of different types of explosives used as bulk industrial explosives in the mining industry including ANFO, HiDex, XLoad, and GPE70.

62. ANFO consists of 94% porous prilled ammonium nitrate (NH4NO3) and 6% fuel oil.

63. Heavy ANFO (“HiDex”) (which is a product supplied by LDE) is a combination of ANFO, diesel oil or mineral oil and high energy emulsion material. HiDex can provide a seal against low pressure water ingress into a blast hole, subject to the degree of water ingress and the emulsion ratio.

64. The LDE technical data sheet lists the down hole life (or sleep time) of HiDex as “Load/Sleep/Shoot (Depends on density)”. Specific sleep times for the different HiDex products identified on the technical data sheet are not specified. HiDex 120 with 25% emulsion can be expected to remain in the ground in dry holes, holes with damp sides, or dewatered holes not making water, without significant deterioration for at least seven days, provided that there is no inflow of water into a hole and the hole has been bagged off to prevent product falling into water at the bottom of the hole.

65. The longest period of time any of the explosive products are in a damp walled, or wet walled, or dewatered drill hole, is approximately 54 hours.

66. Emulsion is an ingredient which is used to fill the interstitial voids in the HiDex in order to increase the water resistance of the product. The addition of emulsion to ANFO to create HiDex also has the effect of increasing the density of the product.

67. As long as ammonium nitrate and diesel oil are available, the ratio of ANFO to emulsion can be adjusted on-site at Rocglen Mine (through use of MMU’s) to create various blends of HiDex.

68. The LDE supply contract specifies that HiDex 100 is an 88:12 ANFO to emulsion blend, that HiDex 120 is a 75:25 ANFO to emulsion blend, and HiDex 130 is a 68:32 ANFO to emulsion blend.

69. LDE’s technical data sheet for Heavy ANFO states without qualification that HiDex “is a mixture of ANFO and XM 1000 [emulsion] for use in dry and dewatered blast holes" and lists "dewatered blast holes" as one of three "common uses of HiDex range".

70. XLoad is another explosive which is produced by LDE. It is an explosive with high water resistance that can be loaded at densities that are lower than Heavy ANFO in order to achieve the same detonation velocity.

71. The technical data sheet for XLoad states that it was suitable for use in “wet, dewatered and dry holes”. One component of XLoad explosive is polystyrene. XLoad requires the use of mineral oil as the fuel source and emulsion. Diesel oil cannot be used because it breaks down the polystyrene.

72. Because XLoad uses mineral oil instead of diesel oil, and because explosives could not be stored at Rocglen Mine, XLoad needed to be ordered from LDE by WCM a week before it is due to be loaded. The use of XLoad also requires the use of different loading equipment (compared to HiDex).

73. GPE70 is an explosive product produced by LDE and specifically designed for use in water filled drill holes.

The Original Blast Design

74. The original blast design for the blast prescribed that dry holes were to be loaded with HiDex 100, dewatered holes were to be loaded with XLoad 100, and that wet holes were to be loaded with GPE70. The blast was originally designed by Mr G Cope.

75. At 6.40am on 4 August 2016, Mr G Cope placed an order to LDE for the explosives required for the following week for Rocglen Mine. It included an order for products for other blasts at Rocglen Mine.

76. The order consisted of the following products:

1. 8 August 2016 – 100 tonnes of HiDex 100 and 20 tonnes of XLoad 100, and 20 tonnes of GPE70;

2. 9 August 2016 – 80 tonnes of HiDex 100;

3. 10 August 2016 – 160 tonnes of HiDex 100;

4. 11 August 2016 – 12 tonnes of GPE70 and 40 tonnes of HiDex 100; and

5. 12 August 2016 – 100 tonnes of HiDex 110.

77. It was intended to have HiDex, XLoad and GPE70 explosives all available for loading the blast on 8 August 2016.

78. The original proposed design prescribed the use of XLoad in dewatered holes.

79. The drill and blast engineer, Mr G Cope, had an expectation that the shot-firer would load XLoad if dewatering of the holes occurred.

Change to the Order

80. On 5 August 2016 at 12:56pm, Mr McDonald sent an email to Mr Andrew Gill, LDE’s Operations Coordinator, which said:

I just finished speaking with Alvin. He said that we will be running with HiDex product for Monday at Rocglen, so we won’t need the poly trailer or mineral oil.

81. On 5 August 2016 at 2.38pm, Mr G Cope emailed LDE and indicated that WCM required the ability to load hybrid XLoad explosives on 8 August 2018, and also required technical support to do so.

82. On 5 August 2016 at 5:14pm, LDE advised Mr G Cope by email that LDE would not be able to supply mineral oil on 8 August 2016, and therefore, would be unable to supply its XLoad product until the following day on 9 August 2016, and that the delivery time would not be known until the 8 August 2016.

83. Had WCM changed back to the use of explosives incorporated in to the original blast design and used XLoad and GPE70 in the blast, LDE could have supplied the explosives but this would have resulted in delaying the commencement of loading and subsequent firing of the blast by one day.

84. When formally interviewed on 15 February 2017, Mr G Cope stated that he was satisfied that HiDex 120 was a suitable product to be used as a replacement for HiDex 100 in the blast design.

Postponement of the Blast Due to Wet Weather Conditions

85. In the weeks preceding the blast there were a number of rain events at Rocglen Mine as follows:

1. 20 July 2016 – 11mm;

2. 21 July 2016 – 17.4mm;

3. 22 July 2016 – 0.2mm;

4. 2 August 2016 – 13.6 mm;

5. 3 August 2016 – 45.4 mm (68mm was recorded at an admin gauge); and

6. 8 August 2016 – 0.2mm.

86. The blast was originally to take place on 4 August 2016, however, the drill and blast engineer decided to postpone the shot due to rain events that occurred during 2 to 4 August 2016.

87. The blast was postponed on 8 August 2016, and again on 9 August 2016.

WCM Undertook Dewatering of the Blast Holes and Loading of Explosives

88. Drilling of the blast pattern (the pattern of individual drilled holes into which explosives are loaded) commenced on 22 July 2016, however, due to wet weather conditions, initial drilling was delayed.

89. WCM was aware from past experience that the area to be blasted included areas with soft ground conditions. This was confirmed when the holes for the blast were drilled.

90. WCM was aware that weak or soft ground conditions were a factor, amongst others, that could contribute to NOx fume generation.

91. Following drilling, holes were initially dipped on 3, 4 and 5 August 2016. Holes that had not yet been drilled were dipped prior to the loading of explosives the following week (between 8 and 10 August 2016).

92. When the holes for the blast were drilled it was recorded that drillers encountered water. Water was encountered at depths deeper than the 12m design level. Records of encountering water during drilling are different from encountering water when holes are dipped.

93. The blast report for the blast recorded that 90% of holes were wet holes. When interviewed, Mr Wicks indicated that the reference to “wet holes” on the blast report did not mean that the drill hole had standing water in it, rather that the hole had wet or damp walls. This was indicated by the presence of mud on the tape that was used to dip the hole. Mr Wicks stated that only some holes were found to contain standing water. As a result, a number of holes were required to be, and were, dewatered. Dewatered holes were then checked for groundwater recharge 24 hours later by being dipped prior to being loaded with explosive product. The dipping of dewatered holes indicated that no groundwater recharge had occurred in those holes.

94. A number of holes on the western side of the shot were required to be dewatered. When holes were dewatered the ground beside the hole was marked with paint. Holes that were dewatered on 8 and 9 August 2016 were dipped again the following day prior to the loading of explosive product.

95. If a hole was dipped more than once, the results of the dipping were not recorded if nothing had changed since the initial dipping.

96. Following the rain which occurred on 6 and 7 August 2016, a clean-up process occurred on 8 August 2016, so that the area of the shot would be accessible for loading of explosives by LDE’s MMU vehicles. The weather station did not record any rain on 6 August 2016 or 7 August 2016, however, it did record 0.2 mm of rain in the early morning of 8 August 2016.

97. The clean-up of the bench involved an excavator clearing access for the MMU vehicles. Also as a result of the rain at Rocglen Mine, there was some surface water on the surface of the bench on 8 August 2016, but this was gone by 9 and 10 August 2016. Mr G Cope described the conditions on the bench following clean up as “good” on 8 August 2016, and that it was possible to walk around the bench. In respect of the two hours that Mr McDonald was at the mine on 8 August 2016, he observed that the bench was boggy and sloppy underfoot.

98. On 8 and 9 August 2016, dewatering (achieved through the use of a suction hose) of some drilled holes occurred while the LDE’s MMU’s were loading explosives on the bench.

99. The shot-firer for the blast, Mr Wicks, did not review the drill logs before commencing to the loading the explosives into the drilled holes because the logs were not included in the blast pack. When interviewed, Mr Wicks indicated that the drill plan for the blast was not included in the blast pack.

100. Mr Wicks was aware prior to loading the explosives that drill logs are important because they contain information with respect to ground conditions which can inform explosive product selection. From past experience, Mr Wicks and Mr G Cope were already aware of the general ground conditions in Rocglen Mine pit.

101. Some holes on the shot were drilled deeper in order to assist in confirming the geological model for Rocglen Mine. Some holes on the eastern side of the shot were not drilled to depth because they could be dug effectively without blasting. Holes that had been drilled deeper were backfilled, and holes that were drilled shallower were not loaded.

102. A record referred to as a “charge sheet” noting the explosives loaded was produced in relation to the blast by the MMU operator progressively as the holes were loaded.

103. On 8 August 2016 HiDex explosives were supplied for the blast.

104. Because not all blast holes had been drilled prior to 8 August 2016 when loading commenced, the loading of explosives started on the eastern side of the shot while drilling of blast holes was still occurring on the western side of the shot. For some holes, loading occurred “up close behind the drills”.

105. Due to the wet or damp walls being encountered in drill holes, a decision was made by WCM on 8 August 2016 to increase the emulsion ratio in the Heavy ANFO explosive product to be loaded into the drilled holes, namely, to change from using HiDex 100 to using HiDex 120.

106. This decision was made by Mr G Cope after a phone call he had with Mr Wicks. Mr G Cope recalls Mr Wicks informing him that the drilled holes were a bit wetter than when they were first dipped. Mr Wicks recalls phoning Mr G Cope and informing him that holes with damp walls had been encountered. Mr Wicks was instructed by Mr G Cope to change the explosives from HiDex 100 to HiDex 120.

107. Mr Wicks was not provided with a new charge sheet for the redesigned blast by the drill and blast engineer. Mr Wicks undertook the recalculation of the amount of explosive to be loaded into each hole on the bench.

108. When later interviewed, Mr G Cope stated that the changes to the blast design were not recorded and that the changes were made verbally.

109. Mr G Cope said that the original blast design indicated that XLoad 100 should have been used in dewatered holes, and that the shot-firers did not follow the blast design to the extent that they did not load XLoad 100 in dewatered holes.

88. He also indicated that the shot-firers did not advise him that XLoad 100 had not been loaded into any of the holes, but that he became aware of this fact on 8 August 2016 because that product was not available.

89. Due to the change in the density of the explosive being used (from HiDex 100 to HiDex 120), the amount of explosive to be loaded into the drill holes needed to be recalculated by Mr Wicks and Mr McKay for those drill holes.

90. The recalculation of the amount of explosives to be loaded as a result of a change in blast design is ordinarily undertaken by the blast engineer, but in this case it was undertaken by Mr Wicks and Mr McKay on the bench as loading was occurring.

91. Mr Wicks was aware that there were other LDE explosives products (other than HiDex) that were more suitable to soft ground conditions and wet holes. Mr Wicks had used such products before in wet holes that had been dewatered. Mr Wicks had previous experience in the use of XLoad.

92. WCM had changed its product order with LDE (as distinct from changing the product density) for blasts that have occurred at Rocglen Mine.

93. The drill and blast engineer was aware prior to the change in design that the use of XLoad could result in fewer fumes.

Inspections of the Drilled Holes

116. After the drilled holes had been loaded and stemmed, but before the blast was fired, Mr A Cope inspected the bench or walked the shot. He was concerned at the fact that slumping had occurred at a couple of holes and he conveyed this to the shot-firer, Mr Wicks.

117. Slumping of a loaded and stemmed hole can be an indication of a number of different factors:

1. failure or leakage of a gas bag;

2. explosive product seeping into cracks;

3. dynamic water in holes;

4. rainfall on a sleeping shot;

5. collapse of the hole; or

6. disintegration of the explosive product.

118. Mr Wicks walked the shot after Mr A Cope and noticed three or four holes that had settled, possibly owing to gas bags in the holes having given way, which Mr Wicks "kicked in" by kicking the stemming back on top of the holes.

119. Gas bags were installed in the holes above the explosive product and below the stemming material in order to create an air deck.

Steps Undertaken Prior to the Blast

120. Prior to the blast being fired, a blast exclusion zone was identified at Rocglen Mine. A number of WCM’s staff were positioned as sentries on Wean Road outside of Rocglen Mine. One sentry was positioned to the north of the blast, at the intersection of Wean Road and Jaeger Lane, to stop any traffic travelling south on Wean Road or west on Jaeger Lane from entering the blast exclusion zone. Another sentry, the Mines Operations Manager, was positioned to the south of the blast on Wean Road, around 100m outside the blast exclusion zone, to stop any traffic travelling north on Wean Road from entering the blast exclusion zone. Ms Whitten and Mr G Cope were standing at the same location at the time of the blast. A third sentry was positioned to the west of the mine pit in the Vickery Forest to stop any persons travelling from the forest into the blast exclusion zone.

121. A number of the staff positioned as sentries outside Rocglen Mine were not informed of the possibility of fume generation.

The Blast Incident and Its Aftermath

122. At approximately 12:00pm on 10 August 2016, WCM fired blast RG16_0713_RL240 at Rocglen Mine which generated a blast fume cloud containing NOx gases.

123. As stated above, drilling of the blast pattern for the blast commenced on 22 July 2016. The explosives used in the blast were loaded into drill holes over a three-day period from 8 to 10 August 2016. The blast was fired on day three, namely, 10 August 2016. The longest period of time any of the explosive products were in the drill holes was approximately 54 hours.

124. As could be seen in two videos of the blast played to the Court, the blast resulted in the generation of a post-blast fume cloud. Within the mine pit the fume initially migrated towards the south and then hit the pit’s high wall. After rising from the mine pit, the blast fume moved in a generally easterly direction, progressively moving higher and decreasing in density. It crossed Wean Road which forms the eastern boundary of the licensed premises.

125. The blast fume, as depicted in photographs and the videos, moved across the paddock of a neighbouring private property where some work sheds were located. Sentries were located on Wean Road in order to exclude persons travelling on Wean Road from entering the blast exclusion zone. The blast fume continued to move in a generally easterly direction away from the neighbouring private property towards hills that are located on land owned by WCM, where the visible fume cloud ultimately disappeared. The land on which the fume finally dissipated is owned by WCM.

126. On 10 August 2016 WCM self-reported the fume event to the:

1. Environment Protection Authority (“the EPA”);

2. Public Health Unit – Tamworth;

3. SafeWork NSW;

4. Gunnedah Shire Council;

5. NSW Fire and Rescue; and

6. Department.

127. No complaints from any members of the public were received by WCM in relation to the blast or the fumes generated from the blast.

128. WCM undertook an internal investigation into the fume event known as an “Incident Cause Analyst Method Investigation” (“the ICAM investigation”). The participants involved in the ICAM investigation into the blast incident were as follows:

1. the WCM Rocglen Safety and Training Coordinator, acting as a facilitator;

2. Mr Conomos;

3. a Senior Mining Engineer at WCM;

4. Mr G Cope;

5. Mr Wicks;

6. Mr A Cope;

7. Ms Whitten;

8. Mr Parsons;

9. Mr Rock; and

10. an Graduate Engineer working at LDE.

129. Past ICAM investigations sometimes disseminated reports to various levels of senior management in WCM and WCL, depending on the level of seriousness of the incident or event, especially in circumstances where a significant safety, environmental or community incident occurred.

Impact of the NOx Gases

130. NOx fume or NOx gases are gases that are often formed as a by-product of the incomplete detonation of ammonium nitrate-based explosives, including bulk industrial explosives such as ammonium nitrate fuel oil with emulsion (or Heavy ANFO).

131. NOx gases are oxides of nitrogen and largely comprised a mixture of colourless nitric oxide (“NO”), and yellow and red coloured nitrogen dioxide (“NO2”).

132. When ANFO is exposed to water it will break down because it is water soluble. By contrast, Heavy ANFO (the explosive product used in the blast) contains an emulsion product which itself is highly water resistant and will coat the prill and provide protection from water damage if present in a sufficient ratio.

133. Prior to the blast incident, WCM was aware that a cause of NOx fume production was the degradation of ammonium nitrate based explosives as a consequence of water ingress.

134. The degree of water degradation protection in the Heavy ANFO explosive products is related to the amount of emulsion in the product (that is, the higher the emulsion content the higher the water resistance).

135. Another potential cause of NOx fume is a less than optimal detonation of the explosive due to soft ground conditions. A higher emulsion ANFO explosive, such as Heavy ANFO, has a higher velocity of detonation. In soft ground where the detonation is less confined or contained, the explosive product expands more rapidly which in turn can lead to less complete detonation and fume production.

136. The AEISG Code includes a scale which is used across the industry to identify and rate post-blast NOx gases using a scale from 1A to 5C (where 1A signifies the lowest intensity and 5C is the highest intensity).

137. The blast viewed from the pit was consistent with either a 3B or a 4B rating.

138. NOx gases created by the use of industrial explosives can be influenced by a number of factors including:

1. blast design and explosive selection;

2. geological and hydrological conditions;

3. blasting practices, including dewatering and charging/loading of the individual blast holes;

4. contamination of explosives once loaded; and

5. explosive formulation.

139. Blast detonation at mines is a series of complex and interrelated chemical reactions that have different end points. If the post detonation temperature is not sufficiently high, then some of these reactions are effectively quenched leading to unwanted products including NOx. In addition to those listed above, factors that can influence the detonation reaction of a properly formulated explosive include, but are not limited to, rock type, rock structure, rock hardness, rock strength, jointing, cracking, damage from previous blasts, charge diameter, charge depth, water content of the explosive, water in the rock mass, groundwater, shock waves from previously detonating charges, product density, product delivery methods, initiation systems, and primers.

140. The principal danger associated with NOx gases is a potential to cause harm to biological organisms from that nitrous oxide which, when combined with water, forms nitric acid. In terms of harm to humans and animals, the primary health impacts arising due to NOx exposure can involve irritation to eyes, lungs, skin, and mucosa, by acid burns and in more extreme incidents of exposure, damage to those organs. The health impacts to humans and animals from direct exposure can range from mild to fatal.

Impact of the Blast Fumes on the Environment and on the Neighbouring Property

141. The blast incident occurred approximately 200m from the boundary of a private property (“the Belmont property”). The blast created a NOx fume cloud which moved in a generally easterly direction and beyond the boundary of Rocglen Mine and moved across a public road, Wean Road, before entering the Belmont property.

142. As the fume cloud progressively moved eastward, it rose in height and its density reduced. The fume cloud continued to move in a generally easterly direction onto property owned by WCM where it disappeared approximately 15 minutes after the blast.

143. The blast fume was reportable to the EPA under s 148 of the POEOA and condition O4.1 of the EPL because it moved beyond the boundary of the licensed premises. The blast fume was also reportable to the Department in accordance with section 4.3(3) of the Blast Fume Management Plan because it moved beyond the project approval boundary. WCM complied with both of these reporting requirements.

144. The worst of the fume was generated from the area of the blast that was the last to be drilled where only some dewatering occurred.

145. Mr Ronald Rennick is the owner and occupier of three farming properties located in the vicinity of Rocglen Mine. They are the Belmont property, the Rosebery property and the Glenrock property. Mr Gary Rennick is the son of Mr R Rennick. Mr G Rennick is an electrician based in Gunnedah who sometimes undertook work at the Belmont property.

146. Mr R Rennick was 82 years of age at the time of the blast incident. On the Belmont property were a number of work sheds. The work sheds include a shearing shed, a hay shed, a workshop, a machinery shed, a utility shed and a lunch room. Mr R Rennick attends the sheds every day. The work sheds are approximately 800m from the licensed premises.

147. The work sheds on the Belmont property can be accessed by a lockable gate on Wean Road or by internal access lanes from within Mr R Rennick’s other properties. Mr R Rennick ordinarily accesses the sheds by the internal access lane.

148. The Belmont property, the Rosebery property and the Glenrock property are used for grazing sheep and cattle all year. Combined, the three properties have a total area of approximately 2,000 acres. Sheep and cattle are moved around the properties on a rotational basis.

149. No stock was observed in the paddocks of the Belmont property in the 15 minutes following the blast.

150. Mr G Rennick undertakes work at Belmont approximately three times a week; one day during the week and one or two days on the weekend. Mr G Rennick does not reside on the properties.

151. Mr R Rennick and Mr G Rennick (“the Rennicks”) sometimes engage contract workers who undertake work at the sheds on the Belmont property. Shearers, for example, are hired two times a year in January and in September-October, together with other contractors such as mechanics or persons, to assist Mr G Rennick with cattle work.

152. The sheds have a UHF radio. The UHF radio is used by the Rennicks to communicate internally. The Rennicks do not use the UHF radio to communicate with Rocglen Mine, although they are aware that the Rocglen Mine uses channel 20 for part of its operations.

153. Mr G Rennick has been contacted in the past by WCM by text messages to his mobile phone number with respect to, for example, feral animal baiting being carried out. Mr R Rennick is usually contacted by WCM on his home phone number (landline) the day before a blast and notified of the likely time, or with an update message if the blast is cancelled. Mr R Rennick has an answering machine connected to his landline.

154. Mr G Rennick did not observe the blast or the subsequent fume incident and was not on the property at the time of the blast.

155. Mr R Rennick did not observe the blast or the subsequent fume dispersion.

156. When Mr R Rennick was working at the sheds, and he was notified that a blast had been scheduled, he would watch the blast from the sheds out of interest. When shown photographs of the 10 August 2016 blast fume by the EPA during an interview on 25 July 2017, Mr R Rennick stated that he had never seen a blast "of that length", but that he had previously observed orange fume clouds at Rocglen Mine when standing near the sheds.

157. Despite the view of the drill and blast engineer and Mr Wicks that a fume event was possible, WCM did not communicate this possibility to the Rennicks prior to the blast occurring or even after the fume event was observed.

158. Prior to the blast, WCM had not provided any information to the Rennicks regarding a potential blast fume or what they should do in the event that a blast fume migrated onto their property and into their physical vicinity.

159. No actual harm was caused to the Rennicks, or any other person, or to any sheep or cattle, as a result of the blast incident.

160. When Mr R Rennick was questioned by the EPA investigator as to his relationship with WCM, he replied:

Ten out of ten… Well, any little thing that we have requested over the time we have been there, they’ve fully fulfilled whatever we’ve asked of them.

WCM Agrees that the Licensed Activity Was Carried Out in a Less than Competent Manner

161. WCM agreed that that the licensed activity was carried out in a less than competent manner for the following reasons. First, WCM had failed to undertake a written risk assessment prior to conducting the blast.

162. Second, WCM had failed to adopt a different explosive product, despite being aware of factors such as the softness of the ground, the wetness of ground conditions, whether holes were required to be dewatered, and whether gas bags were used in drilled holes.

163. They were aware that there were a number of drilled holes which contained standing water which required dewatering.

164. Dewatered holes were dipped 24 hours later, prior to loading, to ascertain whether there had been any groundwater recharge. Dipping of dewatered holes did not identify any significant groundwater recharge. Some mud was noted at the bottom of some holes. Gas bags were placed above the mud to isolate the product from the mud.

165. HiDex 110 was loaded into dry holes and HiDex 120 was the explosive loaded into all other holes.

166. WCM’s direction that HiDex 120 be loaded by LDE into dewatered holes, and holes with no standing water but with wet or damp walls, was in conformity with the Loading and Stemming Blast Holes Procedure which stated that:

Low density heavy ANFOs with emulsion content less than 30% and ANFO should only be loaded into dewatered blast holes that have had time to dry out (where there is no recharge). These products can also be loaded above water, using a gas bag to seal the hole, as long as recharge is not taking place higher up the water column.

167. WCM placed two gas bags in most drilled holes. A total of 600 gas bags were used in the blast. Where mud or water was detected in the bottom of a hole as a result of dipping, a gas bag was placed at the bottom of the hole and the explosive product was then loaded on top of it. A gas bag was placed around one metre above the top of the HiDex 120 as an air deck.

168. A gas bag when placed in a drilled hole prior to explosive product being loaded ensures that the explosive product is isolated from water in the bottom of the hole and prevent the explosive product from interacting with the water.

169. The use of XLoad would have reduced to the greatest extent the risk of blast fume generation in the prevailing conditions. Therefore, in using an explosive that did not reduce to the greatest extent the risk of blast fume generation in the conditions, WCM carried out the scheduled activity in a less than competent manner.

170. Third, 8.5% of the blast holes were overloaded with explosive. This resulted in powder factors in some holes that were in excess of the powder factor specified in the blast design.

171. A high localised powder factor in soft ground can contribute to the generation of post blast fume. In overloading 8.5% of blast holes, WCM carried out the scheduled activity in a less than competent manner.

172. Fourth, there were several departures from the internal blast management plans. These were that:

1. for holes that were dewatered, no written record was kept of the specific holes, the condition of the holes, or the time between dewatering and loading the holes;

2. the extent of record keeping for the blast was not complete in relation to variations to the original blast design;

3. section 4.6 of the Blast Fume Management Procedure required that “the type of explosive product used for individual blasts will be selected to minimise the potential for fume generation”;

4. Mr R Rennick was not notified of the fume entering his property as required by section 4.4 of the Blast Fume Management Procedure; and

5. there was a failure to comply with section 2 of the Blast Management Plan which included a requirement to implement the “best blasting management practice” on site to:

1. protect the safety of people and livestock in the surrounding area;

2. protect public or private property in the surrounding area; and

3. minimise the dust and fume emissions of the blasting.

173. Fifth, there was a need to be particularly focused on a potential fume in light of the conditions in which the blast took place, that is, wet walls, very soft material and ground conditions, and a failure of the high wall on the eastern side of the spit.

174. Sixth, the WCM drill and blast engineer was aware that LDE had recommended the use of XLoad explosive in dewatered holes that stayed dewatered.

175. Seventh, given the conditions that presented themselves on the eastern side of the area of the blast, when looking at the drill logs, it was remiss of anyone not to consider a potential fume event. In other words, WCM should have been taking all possible steps to minimise the potential for fume.

Evidence of Mr Frankcombe

176. Mr Frankcombe, the Chief Operating Officer, gave evidence on behalf of WCM. He acknowledged that WCM is a wholly owned subsidiary of WCL, a company listed on the Australian Stock Exchange. Mr Frankcombe has responsibility for Rocglen Mine.

177. In his affidavit, Mr Frankcombe acknowledged that WCM was responsible for the fume event and apologised for it. He noted that the mine had been operating since 2008 and that there had been 335 blasts at the mine. He further noted that WCM promptly notified the blast to the EPA and the Department and that WCM has subsequently taken steps to minimise the likelihood of a fume event recurring at the mine. These steps were outlined in detail in his affidavit. They included the retention of experts to provide advice, the relocation of the mine’s weather station, reviewing and modifying the Blast Management Plan, and the provision of additional training to those involved in blasting.

176. Mr Frankcombe also detailed the various ways in which WCM has engaged and participated in community activities in the Gunnedah region.

177. The EPA relied on parts of a record of interview with Mr Frankcombe dated 4 May 2017, to cross-examine Mr Frankcombe. He was cross-examined in an attempt to elicit a concession to the effect that WCM did not accept that it had done anything wrong in selecting the explosive product used on the day in question. Presumably this was in order to found a submission that the Court should not afford full weight to the expression of contrition given by Mr Frankcombe on behalf of WCM.

178. However, as Mr Frankcombe reiterated orally, he, and therefore WCM, wholly accepted that, given the benefit of hindsight, the benefit of fulsome investigations, and the benefit of expert advice, a different available explosive product ought to have been selected to reduce to the greatest extent possible the potential risk of a fume event occurring. Having said this, given the knowledge and experience of WCM at the time of the commission of the offence (including technical data sheets for Heavy ANFO and common industry usage), the selection and use of Heavy ANFO that day was not necessarily wrong.

179. To the extent that the EPA sought to cross-examine Mr Frankcombe on the differences between the written procedures in place at the time of the commission of the offence and the present written procedures in place for blasting, in my view, this merely emphasised the extent to which WCM had learned from the blast incident and had taken steps to improve its internal processes.

180. Finally, the EPA elicited from Mr Frankcombe evidence of the fact that many of the employees employed at Rocglen Mine who were involved either directly or indirectly in the blast incident were likely to be employed elsewhere in the Gunnedah Operations upon the cessation of Rocglen Mine’s use as a mine.

Applicable Sentencing Principles

The Purposes of Sentencing

183. The purposes of sentencing are set out in s 3A of the Crimes (Sentencing Procedure) Act 1999 (“CSPA”):

3A Purposes of sentencing

The purposes for which a court may impose a sentence on an offender are as follows:

(a)    to ensure that the offender is adequately punished for the offence,

(b) to prevent crime by deterring the offender and other persons from committing similar offences,

(c)    to protect the community from the offender,

(d)    to promote the rehabilitation of the offender,

(e)    to make the offender accountable for his or her actions,

(f)    to denounce the conduct of the offender,

(g)    to recognise the harm done to the victim of the crime and the community.

Statutory Matters Required to be Taken into Account in Sentencing

184. The POEOA sets out the matters which are to be taken into account when sentencing for offences committed under that Act. Section 241(1) and (2) of the POEOA provides that:

241 Matters to be considered in imposing penalty

(1)    In imposing a penalty for an offence against this Act or the regulations, the court is to take into consideration the following (so far as they are relevant):

(a) the extent of the harm caused or likely to be caused to the environment by the commission of the offence,

(b) the practical measures that may be taken to prevent, control, abate or mitigate that harm,

(c) the extent to which the person who committed the offence could reasonably have foreseen the harm caused or likely to be caused to the environment by the commission of the offence,

(d) the extent to which the person who committed the offence had control over the causes that gave rise to the offence,

(e) whether, in committing the offence, the person was complying with orders from an employer or supervising employee.

(2) The court may take into consideration other matters that it considers relevant.

185. Sections 21A(2) and (3) of the CSPA also set out aggravating and mitigating factors that the Court must consider. Relevant to the facts of this case they are as follows:

21A Aggravating, mitigating and other factors in sentencing

(2) Aggravating factors

The aggravating factors to be taken into account in determining the appropriate sentence for an offence are as follows:

…

(d) the offender has a record of previous convictions (particularly if the offender is being sentenced for a serious personal violence offence and has a record of previous convictions for serious personal violence offences),

…

(o) the offence was committed for financial gain…

The court is not to have additional regard to any such aggravating factor in sentencing if it is an element of the offence.

(3) Mitigating factors

The mitigating factors to be taken into account in determining the appropriate sentence for an offence are as follows:

(a)   the injury, emotional harm, loss or damage caused by the offence was not substantial,

(b)    the offence was not part of a planned or organised criminal activity,

…

(e)    the offender does not have any record (or any significant record) of previous convictions,

(f)    the offender is a person of good character,

(g)    the offender is unlikely to re-offend,

(h)    the offender has good prospects of rehabilitation, whether by reason of the offenders age or otherwise,

(i)    the remorse shown by the offender for the offence, but only if:

(i)    the offender has provided evidence that he or she has accepted responsibility for his or her actions, and

(ii)    the offender has acknowledged any injury, loss or damage caused by his or her actions or made reparation for such injury, loss or damage (or both),

…

(k)    a plea of guilty by the offender (as provided by section 22 or Division 1A),

…

(m) assistance by the offender to law enforcement authorities (as provided by section 23),

186. The sentence imposed by the Court must reflect and be proportionate to both the objective gravity or seriousness of the offence and the personal or subjective circumstances of WCM (Veen v The Queen [1979] HCA 7; (1979) 143 CLR 458 at 490 and Veen v The Queen (No 2) [1988] HCA 14; (1988) 164 CLR 465 at 472).

187. The appropriate sentence for WCM is to be determined by an instinctive synthesis of all of the relevant objective and subjective circumstances of the commission of the offence (Markarian v The Queen [2005] HCA 25; (2005) 228 CLR 357).

Objective Circumstances

188. The objective gravity of the offence fixes both the upper and lower limits of proportionate punishment. It fixes the upper limit insofar as the sentence must not exceed that which can be justified as appropriate or proportionate to the gravity of the crime considered in light of its objective circumstances (Veen v The Queen (No 2) and Hoare v The Queen [1989] HCA 33; (1989) 167 CLR 348 at 354). It fixes the lower limit because allowance for the subjective factors of the case ought not produce a sentence which fails to reflect the objective gravity or seriousness of the offence (R v Dodd (1991) 57 A Crim R 349 at 354 and R v Nichols (1991) 57 A Crim R 391 at 395).

189. The objective seriousness is to be determined by reference to the nature of the offence and not by reference to matters that are personal to a particular offender (Muldrock v The Queen [2011] HCA 39; (2011) 244 CLR 120 at [27]).

190. In determining the objective seriousness or gravity of the offence the relevant objective circumstances include, the nature of the offence, the maximum penalty under the Act establishing the offence, the reasons for committing the offence, the environmental harm caused by the commission of the offence, the foreseeability of the risk of environmental harm caused by the commission of the offence, the practical measures to prevent any environmental harm caused by the commission of the offence, WCM’s control over the causes giving rise to the offence, and WCM’s state of mind in committing the offence.

Nature of the Offence

191. The objective seriousness of an environmental offence is illuminated by the nature of the statutory provision creating the offence and its place in the statutory scheme. A proper understanding of the underlying purpose of offence is assisted by consideration of the objects of the statute. A fundamental consideration is the degree to which the WCM’s conduct offends against the legislative objective expressed in the offence (Environment Protection Authority v Hanna [2018] NSWLEC 80 at [97]; Bentley v BGP Properties Pty Limited [2006] NSWLEC 34; (2006) 145 LGERA 234 at 242-246; Chief Executive, Office of Environment & Heritage v Orica Pty Ltd; Environment Protection Authority v Orica Pty Ltd [2015] NSWLEC 109 at [59] and Plath v Rawson [2009] NSWLEC 178; (2009) 170 LGERA 253 at [49]).

192. The relevant objects of the POEOA identify the purpose of the offence as follows:

3 Objects of Act

The objects of this Act are as follows:

(a)   to protect, restore and enhance the quality of the environment in New South Wales, having regard to the need to maintain ecologically sustainable development,

…

(d)   to reduce risks to human health and prevent the degradation of the environment by the use of mechanisms that promote the following:

(i)   pollution prevention and cleaner production,

(ii)   the reduction to harmless levels of the discharge of substances likely to cause harm to the environment,

(iia)   the elimination of harmful wastes,

(iii)   the reduction in the use of materials and the re-use, recovery or recycling of materials,

(iv)   the making of progressive environmental improvements, including the reduction of pollution at source,

(v)   the monitoring and reporting of environmental quality on a regular basis,

(e)   to rationalise, simplify and strengthen the regulatory framework for environment protection…

193. The offence of contravening a condition of an EPL is one of strict liability. In Environment Protection Authorityv Orica Australia Pty Ltd (the Nitric Acid Air Lift Incident) [2014] NSWLEC 103; (2014) 206 LGERA 239 the Court held that strict compliance with the conditions of any EPL is necessary to ensure that the objectives of the POEOA are met (at [104]).

194. The condition that was contravened required the licensed activities to be carried out in a competent manner. This condition was imposed to ensure that WCM carried out its business in accordance with a standard that reflects the environmental risks accompanying its licenced activities.

195. In Environment Protection Authority v Huntsman Corporation Australia Pty Ltd [2011] NSWLEC 39 Craig J opined that (at [65]):

65.   Conditions imposed upon an environment protection licence traverse a spectrum of obligations. Some may be seen to be merely procedural, the consequences of non-observance of which are not necessarily adverse to the environment. Others may be regarded as more fundamental in the control of the regulated activity. A condition requiring that the activity be carried out in a competent manner is a condition of the latter kind.

196. In Environment Protection Authority v P & M Quality Small Goods Pty Ltd; Environment Protection Authority v JBS Australia Pty Limited [2017] NSWLEC 89 Robson J held that (at [37]):

37.   It is well accepted that there is a need for the regulatory system established under the POEO Act to be upheld. The system depends upon persons, first, taking steps to ascertain where a licence is required and, if so required, making applications for a licence. It is also clear that the imposition of conditions on a licence is intended to avert the risk of environmental harm that would otherwise eventuate were the activity not regulated. It is clear that the objects of the POEO Act are achieved by complying with authorisations and licences which enable certain conduct, which would otherwise be prohibited, to be carried out on specific conditions.

197. Given the nature of the blasting activity, WCM’s failure to perform the blast in a competent manner posed a risk to the environment because of the potential for serious environmental harm if it did not do so.

Maximum Penalty

198. The maximum penalty reflects the public expression by the New South Wales Parliament of the seriousness of the offence (Camilleri's Stock Feeds Pty Ltd v Environment Protection Authority (1993) 32 NSWLR 683 at 698 and Muldrock at [31]). It also provides a sentencing yardstick for the case before the Court (Markarian at [31] and Elias v The Queen [2013] HCA 31; (2013) 248 CLR 483 at [27]).

199. While the maximum penalty is of significance in determining the objective seriousness of the offence (Rawson at [57]), it is it is only one of a number of factors that has bearing on the Court’s assessment of the seriousness of the offence. In Elias, French CJ, Hayne, Kiefel, Bell and Keane JJ stated (at [27]):

27.    The maximum penalty is one of many factors that bear on the ultimate discretionary determination of the sentence for the offence…The administration of the criminal law involves individualised justice, the attainment of which is acknowledged to involve the exercise of a wide sentencing discretion. It is wrong to suggest that the court is constrained, by reason of the maximum penalty, to impose an inappropriately severe sentence on an offender for the offence for which he or she has been convicted.

200. The maximum penalty for an offence against s 64(1) of the POEOA by a corporation is $1,000,000.

WCM’s State of Mind

201. An offender’s state of mind is a permissible sentencing consideration in respect of an offence committed in contravention of s 64 of the POEOA. A strict liability offence that is committed intentionally, negligently or recklessly will be objectively more serious than one committed accidentally (Chief Executive, Office of Environment and Heritage v Rummery [2012] NSWLEC 271; (2012) 192 LGERA 314 at [122]).

202. There was no evidence before the Court demonstrating that WCM committed the offence intentionally, recklessly or negligently.

WCM’s Reasons for Committing the Offence

203. The criminality involved in the commission of the offence by WCM is measured not only by the seriousness of what actually occurred, but also by reference to the reasons for its occurrence (Axer Pty Ltd v Environment Protection Authority (1993) 113 LGERA 357 at 366 and Bentley at [237]).

204. There was no evidence demonstrating that WCM committed the offence for commercial gain thereby aggravating the seriousness of its offending.

The Environmental Harm Occasioned or Likely to be Occasioned by the Commission of the Offence

205. Section 241(1)(a) of the POEOA requires the Court to take into account the extent of the harm caused, or likely to be caused, to the environment by the commission of the offence. “Harm” is defined in the Dictionary to the POEOA as:

harm to the environment includes any direct or indirect alteration of the environment that has the effect of degrading the environment and, without limiting the generality of the above, includes any act or omission that results in pollution.

206. In Environment Protection Authority v Waste Recycling and Processing Corporation [2006] NSWLEC 419; (2006) 148 LGERA 299 Preston J stated that harm includes both actual harm and potential harm (at [145]-[149]):

145. Harmfulness needs to not only be considered in terms of actual harm, the potential or risk of harm should also be taken into account: Axer Pty Ltd v Environment Protection Authority (1993) 113 LGERA 357 at 366 and Bentley v BGP Properties Pty Ltd [2006] NSWLEC 34 (6 February 2006) at [175]. Harm should not be limited to measurable harm such as actual harm to human health. It can also include a broader notion of the quality of life.

146. Harm can include harm to the environment and its ecology. Harm to an animal or plant not only adversely affects that animal or plant, it also affects other biota that have ecological relationships to that animal or plant: Bentley v BGP Properties Pty Ltd [2006] NSWLEC 34 (6 February 2006) at [174].

147. Harm can be direct or indirect, individual or cumulative. Activities that contribute incrementally to the gradual deterioration of the environment, even when they cause no discernable direct harm to human interest, should also be treated seriously.

148. The culpability of the defendant depends in part on the seriousness of the environmental harm. Sentencing courts have exercised their discretion in relation to penalty on the principle that the more serious the lasting environmental harm involved, the more serious the offence and, ordinarily, the higher the penalty: Camilleris Stock Feeds Pty Ltd v Environment Protection Authority (1993) 32 NSWLR 683 at 701. If the harm is substantial, this objective circumstance is an aggravating factor: s 21A(2)(g) of the Crimes (Sentencing Procedure) Act 1999.

149. The fact that the environment harmed by the offenders conduct was already disturbed or modified is not a mitigating factor: State Pollution Control Commission v White Wings Ltd (unreported, Land & Environment Court, No 50129 of 1991, Bignold J, 1 November 1991) at p 4; Environment Protection Authority v Ecolab Pty Ltd (2002) 123 LGERA 269 at 273 [14]; Environment Protection Authority v Coggins (2003) 126 LGERA 219 at 224 [18]; Environment Protection Authority v Abigroup Contractors Pty Ltd [2003] NSWLEC 342 (15 December 2003) at [24]; Environment Protection Authority v Arenco Pty Ltd [2006] NSWLEC 244 (9 May 2006) at [26].

207. There was no evidence of any actual harm to the environment caused the fume event and WCM’s breach of its EPL condition. Further, there was no evidence of any other actual consequential environmental harm, for example, to livestock.

208. The meaning of the words “likely to be caused to the environment” was considered by Lloyd J in Newcastle City Council v Pace Farm Egg Products Pty Ltd [2002] NSWLEC 66, where his Honour stated (at [44]):

44. In considering the harm likely to be caused to the environment, it is to be noted that the word “likely” in this context has been held to mean “a real or not remote chance or possibility regardless of whether it is less or more than a fifty per cent chance” (Mathews v Goulburn Wool Processors, NSWSC, Smart J, 6 November 1986, unreported); “only a real chance or possibility, and not more probably than not” (State Pollution Control Commission v Blayney Abattoirs Pty Ltd (1991) 72 LGERA 221 at 224); and “does not mean probable. It means a real possibility” (New South Wales Sugar Milling Co-operative Ltd v State Pollution Control Commission (1991) 73 LGRA 86 at 100, affirmed by the Court of Criminal Appeal on other grounds, (1992) 75 LGRA 320).

209. It was not open on the evidence to conclude beyond reasonable doubt that the fume passed close to the sheds on the Belmont property, as was suggested by the EPA. This conclusion was evident having regard to the video evidence of the fume before the Court, the blast exclusion zone and various aerial imagery of the pit, the mine, and the location of the sheds on that property.

210. Nevertheless, WCM accepted that at the time that the blast fume passed across the paddock on the adjoining Belmont property, there was some potential for the owner and occupant of the adjoining properties, Mr R Rennick, to have been exposed to the blast fume, had he been in that location at that time. There was also a possibility, albeit less likely, that Mr G Rennick could have been exposed to the blast fume had he been present in that part of the Belmont property at the time of the subject blast.

211. Thus there was clearly the potential for resultant serious environmental harm as a consequence of the NOx gasses released by the blast.

212. In this context, is must be noted that as part of its blast plan, WCM had taken steps to implement a blast exclusion zone, including by closing off, and by posting sentries to, prevent public access to potentially affected sections of Wean Road and Jaeger Lane. There is no suggestion, however, of any likelihood that the fume could have affected any other person in any other location.

213. WCM’s non-compliance with condition 01.1 of the EPL also caused potential for environmental harm insofar as strict compliance with the conditions of any EPL is necessary to ensure that the objectives of the POEOA are met (Orica Australia (the Nitric Acid Air Lift Incident) at [104]).

250. With respect to specific deterrence, in his affidavit, Mr Frankcombe deposed that although mining operations (including blasting activities) are scheduled to cease at Rocglen Mine in June 2019, WCM intends to carry out four further ground blast exercises in 2019, and moreover, that the EPL will remain extant while WCM trades for another 18 months after June 2019 for the purposes of mine rehabilitation.

251. On this basis, as WCM accepted, with which I agree, that there is a need to take into account an element of specific deterrence in determining the appropriate sentence to be imposed.

252. The penalty imposed by the Court must serve as a general deterrent. Section 3A(b) of the CSPA provides that one of the purposes for which a Court may impose a sentence is to prevent crime by deterring the offender and other persons from committing similar offence. General deterrence is vital “to ensure that the penalty imposed acts to deter those who might engage in similar activities from committing like offences” (Mouawad v The Hills Shire Council [2013] NSWLEC 165; (2013) 199 LGERA 28 at [118]).

253. General deterrence plays a crucial function in sentencing (P & M Quality Small Goods at [87]). In Axer, Mahoney JA stated that “the legislation does not seek merely to prevent deliberate or negligent pollution. It envisages that, at least in many cases, proper precautions must be taken to ensure pollution does not occur” (at 359).

254. In relation to general deterrence:

1. offenders will not be deterred from committing environmental offences by the imposition of nominal fines (Bentley at [140] and Environment Protection Authority v Elf Farm Supplies Pty Ltd [2017] NSWLEC 60 at [98]); and

2. a penalty for a breach must be sufficient to compel attention to the environmental issues to ensure that the offender, and others, are encouraged to comply with the law and that the environment is not exposed to risk of harm (Environment Protection Authority v Robinson [2004] NSWLEC 629 at [30] and Elf at [99]).

256. The Court accepts that embedded with the determination of the appropriate sentence to be imposed on WCM must be an element of general deterrence to ensure that other corporate EPL holders who engage in mining activities involving blasting, carry out these activities in a competent manner.

Retribution and Denunciation

257. Finally, it should be noted that the purposes of retribution and denunciation are also relevant. In particular, the Court must impose a sentence that achieves the purposes of denouncing the conduct the subject of the offence and making WCM accountable for its actions.

Consistency in Sentencing

258. The task of the sentencing court is to pursue the ideal of even-handedness in the matter of sentencing (R v Oliver (1980) 7 A Crim R 174 at 177; R v Visconti [1982] 2 NSWLR 104 at 107). However, care must be taken in the task of achieving consistency. There is always difficulty comparing the penalty in one case with a penalty in another because of the wide divergence of facts and circumstances in each case (Axer at [365]), and one 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]).

259. The parties drew to the Court’s attention two comparable cases concerning blast fume emissions, albeit occasioned by a breach of s 129(1) of the POEOA. First, in Wambo Coal a blast at Peabody Energy's Wambo Mine resulted in the emission of fume of a 3C rating which left the licensed premises and caused short term physical harm to six nearby residents and had the potential to harm children at a nearby childcare centre. Factors contributing to the blast fume generation included powder factor, water damage to some drill holes or cracks/cavities in some drill holes, and lack of confinement in some soft weathered material. Wambo received complaints from five members of the public in relation to the blast. Actual harm was caused to the health of six neighbouring residents who were exposed to the fume, but this harm was of limited duration and seriousness due to the generally short exposure times (at [38] and [72]). It was not anticipated that the affected residents would suffer any serious or long term health problems as a result of the incident (at [39]). However, the incident had the potential to impact other nearby residents including the children at the nearby childcare centre (at [40])

260. The Court found that the offender had general control over its blasting procedures and had followed the usual protocols in its blast management plan by utilising the meteorological station and weather balloons. However, the Court acknowledged the difficulties associated with wind prediction and considered that the offender should have been careful in monitoring any discrepancies between the two methods of measurement (at [91]). The Court held that the offence was at the lower end of the middle range of objective seriousness (at [96]). The offender had one previous conviction for an environmental offence involving the same form of conduct (at [102]). A fine of $60,000 (discounted from $90,000) was ordered. A publication order and an order for costs were made (at [170]);

261. Second was the case of Hunter Valley Energy which involved a NOx blast fume following an explosion to remove overburden from a coal mine. The blast fume was classified as level 5C according to the Visual NOx Gases Rating Scale. The fume from the blast travelled in an easterly direction crossing the licenced premises’ boundary. The fume then went across a road and the southern portion of an industrial estate. The fume dispersed over vacant property owned by the offender on the other side of the industrial estate. Authorities were notified following the event. Actual human harm in the form of sore throats, cold-like symptoms and watery eyes was suffered by six people as a consequence of the fume (at [2]). Those affected experienced minor symptoms which resolved shortly afterwards. There was no evidence that anyone required medical treatment or suffered long lasting health impacts (at [19]). The offender agreed that the event caused actual harm to the environment and that the blast fume was significant. The Court found the offence to be at the lower end of the medium range of objective seriousness (at [33]). The Court held that the offender was committed to minimising the impact of its operations on the local environment and community (at [45]). A fine in the amount of $58,500 (after applicable discounts) was imposed and a publication order was made. The offender agreed to pay the prosecutor’s costs in the sum of $30,000 (at [57]).

262. WCM submitted that the offending in both Wambo and Hunter Valley Energy was objectively more serious than the contravention in the present case. Here, the blast incident caused no actual environmental harm and no complaints were received from the public. I agree with this submission.

263. Other relevant comparable cases, each involving a breach of the identical standard EPL condition the subject of the present proceedings in contravention of s 64(1) of the POEOA, and giving rise to the emission of a substance into the atmosphere, are as follows:

1. Environment Protection Authority v Morgan Cement International Pty Ltd [2016] NSWLEC 140 – where a diverter valve within a supplementary silo vent pipe failed preventing a product from the silo to flow to a pipe to the ground. The silo became overfilled because the supplementary silo vent pipe failed to divert the slag product. As a consequence, a quantity of ground blast furnace slag was emitted into the atmosphere and deposited over a distance of almost 1.5 km to the south and southwest of the premises, affecting some of the residents of the area. The slag dust settled on cars, roofs and vegetation (at [2]). Although no actual harm resulted from the breach, the risk of such harm was real, with exposure to the particulate in sufficient quantities to potentially give rise to severe respiratory and cardiovascular health consequences, including morbidity (at [6]). The Court found that the commission of the offence was in the lower to mid range of objective seriousness. This was because the potential for serious harm was moderate, the offence was caused by inadvertence, the offender had demonstrated its commitment to environmental protection by investing in practical measures to improve performance at the premises, the offence did not result from any decision to put the environment at risk in order to save money, and in all the circumstances the offender responded promptly and appropriately to the incident to minimise the environmental impacts of the pollution incident (at [133]). The subjective circumstances of the offender also operated to mitigate to a considerable degree the penalty that would otherwise have been imposed by the Court thereby warranting a total discount of 33% (at [147]). The monetary penalty for a breach of the licence condition was $50,250 (at [165]). The offender was ordered to pay the EPA’s legal costs in the amount of $55,000 and its investigation costs in the sum of $492.50 (at [166]);

2. Orica Australia (the Nitric Acid Air Lift Incident) concerned the escape of nitric acid following the failure of a pipeline in an air lift. The escape occurred because of a break in the acid delivery pipe at the location of a weld at the junction between that pipe and a stub of pipe leading into the sparger of the air lift. The break resulted in nitric acid and compressed air being redirected into the pit where the air lift was located, which at the time was partly filled with recent rainwater. The addition of the nitric acid filled the pit and the ongoing pressure caused the acid to be sprayed out of the pit. The nitric acid discharge reached upwards to a height of approximately three to four metres and had a diameter of approximately two to three inches fanning out to approximately one metre at the top of the spray. The acid that escaped the pit then fell onto the ground around and reacted with materials on the surface. This resulted in the formation of a brownish-orange NOx gas (at [26] – [27]). Orica entered pleas of guilty to a s 64 offence, along with a further s 120 water pollution offence. The s 64 offence concerned a breach of condition O2.1(a) of its EPL, namely, a failure to maintain equipment in a "proper and efficient condition" (at [105]). It was agreed that an estimated 70m² of groundwater had been polluted with nitric acid causing a low pH plume. In addition, low pH water was discharged through Orica's stormwater system into the Hunter River (at [120]). This caused the potential for insignificant environmental harm (at [121]). In terms of mitigation, the Court found that Orica had demonstrated its commitment to environmental protection by investing in practical measures to improve environmental performance at its premises (at [167](c)). Against this, Orica had two relevant prior convictions for environmental matters in New South Wales and had been fined, albeit with no conviction recorded, in respect of six environmental offences in Queensland (at [170] – [174]). A fine of $42,000 was imposed after discounts and the application of the totality principle. Orica agreed to pay the EPA’s costs;

3. In Orica (the Evaporator Incident) - a visible plume of ammonium nitrate was emitted from the defendant's ammonium nitrate manufacturing facility due to an accumulation of solid material causing a valve to become stuck in an open position. The emission caused several employees to suffer physical symptoms such as eye and throat irritation, headaches, and coughing (at [105]). The environmental harm caused was found to be moderate (at [118]). The offence was also found to have been committed negligently (at [119] - [127]). The Court held that the offence was in the mid-range of objective seriousness (at [136]). Multiple prior convictions were found to be an aggravating factor (at [138]). The defendant was fined $175,000, discounted by 30% to $122,500 for mitigating factors (at [161]);

4. Environment Protection Authority v Environmental Treatment Solutions Pty Ltd [2015] NSWLEC 160 – concerned a case in which chemicals were erroneously mixed and hydrogen sulphide gas was consequentially emitted from a waste storage and processing plant. The offending conduct caused substantial actual harm to seven employees, an independent contractor, and a responding police officer, who were taken to hospital after experiencing symptoms such as loss of consciousness, nausea and headaches (at [66]-[72] and [76]]. The Court held the offence to be within the mid-range of objective seriousness (at [91]). The defendant was ordered to pay a fine of $100,000, discounted by 33% to $67,000 (at [110] and [128]);

5. In Environmental Protection Authority v Causmag Ore Company Pty Ltd [2015] NSWLEC 58 - a white dust containing magnesium oxide was emitted from the defendant's magnesium oxide factory for a period of up to 9.5 hours due to multiple failures in relation to the operation of filter bags. The incident resulted in white dust being deposited on cars at nearby car dealerships. The actual environmental harm caused was held to be low and the offence was found to be at the lower end of the range of objective seriousness for offences of this type (at [73] and [89]). Three previous convictions for similar offences was held to be an aggravating factor (at [97]). The defendant was ordered to pay a fine of $110,000, discounted by 25% to $82,500 for its early guilty plea (at [133]); and

6. Environment Protection Authority v Nulon Products Australia Pty Ltd [2015] NSWLEC 153 - concerned an offence against s 64(1) of the POEOA for contravening standard condition O2.1 of the defendant’s EPL. The offence concerned the emission of between 17 and 20 kg of air impurities from the defendant's premises, which manufactured a range of blended lubricants, coolants and motor engine additives. The incident arose when a heating/blending tank was switched to manual mode and left unattended. The heating element in the tank was left on at the end of shift in contravention of established procedures. The manual gearbox fluid in the tank overheated resulting in the emission. The environmental harm was widespread but of short duration (at [67]). Twenty-nine complaints were received and 15 employees at a nearby businesses experienced physical symptoms such as coughing, dizziness, effected speech, nausea headaches, and pressure behind the eyes. The harm was found by the Court to be substantial and the offence was found to be of medium objective serious (at [194]). The defendant was ordered to pay a fine of $160,000, which was discounted by $25% to $120,000 for the defendant's early guilty plea (at [209]).

264. WCM submitted that the offending conduct in the present case should be considered to be significantly less objectively serious than each of the four cases referred to above because the emission of the blast fume in the present case caused no actual environmental harm, whereas actual environmental harm (of differing degrees) resulted from the emissions associated with the offending conduct in each of the decisions noted above. Again, this submission should be accepted having regard to the facts of this case.

WCM Agreed to Pay the EPA’s Costs

265. WCM has agreed to pay the EPA’s costs as agreed or assessed. Payment of the prosecutor’s costs is a common aspect of sentencing for Class 5 proceedings. While  it is legitimate to take into account any associated costs order in determining the appropriate penalty to be imposed (Harris v Harrison [2014] NSWCCA 84; (2014) 86 NSWLR 422 at [100]), an order for costs is not a reason for reducing any penalty to an amount lower than that suggested by the general pattern of sentencing for the relevant offence (Liverpool City Council v Leppington Pastoral [2010] NSWLEC 170 at [50]). Nevertheless if an offender agrees to pay the prosecution’s costs voluntarily, this assistance may be recognised as a mitigating factor (ss 21A(3)(m) and 23 of the CSPA).

Publication Order

266. The EPA seeks a publication order pursuant to s 250(1)(a) of the POEOA. In Waste Recycling and Processing Corp Preston J noted that the Court had made publication orders in a number of cases. His Honour described their function as follows (at [242]):

242.   Publicising sentences for environmental crime improves the effectiveness of sentences as a deterrent. This is particularly applicable to corporate offenders, who are susceptible to criminal stigma.

267. Because a publication order is made in addition to, rather than instead of, any penalty, it ought not be considered in determining the quantum of any monetary penalty to be imposed (Environment Protection Authority v Incitec Ltd [2003] NSWLEC 381; (2003) 131 LGERA 176 at [58]-[59]).

268. The parties agreed to the making of a publication order but there was a dispute as to its wording and reach. The EPA sought a publication order that extended to the WCL’s company website and the WCL Annual Report. It relied on the decisions of this Court in Environment Protection Authority v Ardent Leisure Ltd [2018] NSWLEC 36 (where a notice was ordered to be published in six news publications) and Environment Protection Authority v Dyno Nobel Asia Pacific Pty Ltd [2017] NSWLEC 64 (where a notice was ordered to be published in three news publications). Also brought to the Court’s attention (commendably by WCM) was the decision in Environment Protection Authority v Caltex Australia Petroleum Pty Ltd [2017] NSWLEC 8, where a publication order for a notice to be published in the company’s annual report was made (at [112(3)]).

269. The reach of the publication order, particularly with respect to a notice being placed on WCL’s website and in its annual report was strenuously resisted by WCM on the basis that this would amount to excessive punishment which was not warranted having regard to the objective seriousness of the commission of the offence and the subjective circumstances of WCM. It noted that both Ardent and Dyno concerned the pollution of waters where actual environmental harm occurred and the objective seriousness of the offences was much greater than that of the present case. WCM further noted that the monetary penalty in Dyno was set aside on appeal as manifestly excessive, however, it acknowledged that the publication order remained untouched (Dyno Nobel Asia Pacific Pty Ltd v Environment Protection Authority [2017 NSWCCA 302 (at [63]). WCM drew the Court’s specific attention to the comparable case of Hunter Valley Energy (the facts or which are discussed above) where, although a notice was ordered to be published in four news publications, no order was made that the notice be published on the company’s website or in its annual report.

270. In Environment Protection Authority v Ditchfield Contracting Pty Ltd [2018] NSWLEC 90, Preston J made the following remarks (at [75] – [76]):

75. In addition, Ditchfield should be ordered under s 250(1)(a) of the POEO Act, to publicise the offence, including the circumstances of the offence and its environmental and other consequences, and the monetary penalty imposed and other orders made against Ditchfield. The parties have agreed on the terms of the notice that should be published in the appropriate newspapers. I consider some minor adjustment to the wording should be made to reflect my findings. The parties disagreed as to where the notice should be publicised. The EPA contended that the notice should be published in a newspaper circulating throughout the State (the Sydney Morning Herald), a newspaper circulating in the region in which the offence was committed (the Newcastle Herald) and a trade magazine (Inside Construction). Ditchfield contended that publication in a State newspaper as well as a regional newspaper was too punitive. Instead, the notice should be publicised in only one of those newspapers.

76. The main purpose of publicising the detection, prosecution and punishment of Ditchfield for the offence is to improve the effectiveness of general deterrence. People and businesses need to be aware that the offence of pollution of waters committed by Ditchfield is a crime, that offenders will be prosecuted and that the courts will impose significant penalties on offenders. By such awareness, people and businesses will be deterred from committing the offence. However, in order to achieve this purpose of deterrence, notice must be published in publications and other media accessed by the people and businesses who are to be deterred. The offence of pollution of waters is committed widely and not only in a particular industry. Publication of the notice therefore needs to be widespread. Publication in both a State-wide and a regional newspaper, as well as a trade publication, is appropriate.

271. That case concerned the spill of diesel into a creek. Although, actual harm occurred it was of limited extent and duration, and his Honour characterised the objective seriousness of the offence as low.

272. His Honour’s observations are apposite here. The Court was not, however, referred to an appropriate trade publication.

273. I find that the making of a publication order is appropriate. Furthermore, given that WCM is a wholly owned subsidiary of WCL, which owns and operates other coal mines in the State, and in particular, the Gunnedah region, and given that some of the employees of WCM who played a material role in the commission of the offence are likely to be employed elsewhere in a mine owned by WCL after mining ceases at WCM, I am of the view that, in the absence of WCM having its own website (a Google search of “WCM” results in being directed to WCL’s website), publication of the notice on WCL’s website is appropriate. I do not, however, find that the circumstances of the commission of the offence warrant the additional measure of publication of a notice in WCL’s Annual Report. I am, however, of the view that the notice should also be published in The Daily Telegraph, which is read more widely outside Sydney.

274. The wording of the publication notice has been amended to take into account the suggested changes by both parties.

Appropriate Sentence

275. Having regard to the objective seriousness of the offence and the mitigating subjective factors of WCM, together with the sentences imposed in the relevant comparable cases referred to above, I consider that the appropriate penalty to be imposed for WCM’s contravention is a fine of $55,000. This figure must be discounted by 30% having regard to the subjective circumstances of WCM, which results in a fine of $38,500.

Payment of Monetary Penalty Imposed to the Environmental Trust

276. Pursuant to s 250(1)(e) of the POEOA, the EPA seeks an order that any financial penalty imposed on WCM is made payable to the Environmental Trust established under the Environmental Trust Act 1998 for general environmental purposes.

Orders

277. The Court therefore makes the following orders:

1. WCM is convicted of the offence as charged against s 64(1) of the POEOA;

2. pursuant to s 250(1)(e) of the POEOA WCM is ordered to pay, within 28 days of this order, the amount of $38,500 to the Environmental Trust established under the Environmental Trust Act for environmental purposes;

3. WCM is, at its expense and within 28 days of the date of this order, to cause a notice in the form of Annexure ‘A’ to this order to be placed within the first 5 pages of the following publications, at a minimum size of 9 cm x 12 cm, pursuant to s 250(1)(a) of the POEOA:

1. The Sydney Morning Herald;

2. The Daily Telegraph;

3. The Australian Financial Review; and

4. The Northern Daily Leader.

4. WCM is, at its expense and within 28 days of the date of this order, to cause a notice in the form of Annexure ‘A’ to this order to be placed on the WCL company website under the “Company News” section, pursuant to s 250(1)(a) of the POEOA;

5. within 35 days of the date of this order, WCM must provide to the EPA a complete copy of the pages of the publications and website in which the notice appears referred to in Orders 3 and 4;

6. pursuant to ss 257B and 257G of the Criminal Procedure Act 1986 WCM is to pay the EPA’s legal costs as agreed or assessed; and

7. the exhibits are to be returned.

**********

Annexure ‘A’

On 18 March 2019 Whitehaven Coal Mining Limited was convicted and fined $38,500 for a fume incident at Rocglen Mine near Gunnedah, New South Wales in 2016.

Whitehaven Coal Mining Limited (“WCM”) has been convicted and fined $38,500 by the Land and Environment Court of New South Wales of an offence against s 64 of the Protection of the Environment Operations Act 1997 for breaching a condition of its Environment Protection Licence (“EPL”), in that it failed to carry out its licenced activity in a competent manner.

The charge related to a blast fume at WCM’s Rocglen Mine at Gunnedah in the State's north east that left the mine site and passed over adjoining farmland on 10 August 2016.

WCM conducted the blast using explosive products that did not reduce the risk of blast fume generation to the greatest possible extent, failed to undertake a written risk assessment prior to the blast, departed from provisions contained in its internal blast management plans, and some blast holes were overloaded with explosive.

The blast resulted in a fume event. Such fumes typically include gases known as oxides of nitrogen (or NOx gases). The mixture of potentially harmful post-blast gases was carried from the mine site over neighbouring farmland which housed work sheds. WCM did not notify the neighbouring property that a fume cloud had left the mine. No persons or animals were exposed to the blast fume.

Like all holders of an EPL issued by the Environment Protection Authority (“the EPA”), WCM was required to undertake its mining operations in a competent manner. It failed to do so.

On 18 March 2019 the Land and Environment Court of New South Wales convicted WCM and ordered it to:

(1)   pay a monetary penalty of $38,500;

(2)   pay the EPA's legal costs;

(3)   place a notice in various national, State and regional news publications advising of the commission of the offence, and to pay for the placement of those notices; anD

(4)   place a notice on Whitehaven Coal Limited’s (the parent company of WCM) website in the “Company News” section advising of WCM’s commission of the offence.

Amendments

11 November 2019 - 1. citation added in full at [232];

2. fixed formatting of bullet points at [255];

3. added missing word, "who", at [256].

Decision last updated: 11 November 2019