eis 155 abo3 1133 wilpinjong coal mine, mudgee

EIS 155

ABO3 1133

Wilpinjong Coal Mine, Mudgee

p NSW DEPT PRIMARt INAUSIRIES

I ABO31 133

I U

I Industry &

G±W Investment

I .: •

I

JOINT STRATEGIC ENVIRONMENTAL I COMPLIANCE AND PERFORMANCE

REVIEW ON THE MANAGEMENT OF I DUSTON COAL MINES

I Industry & Investment NSW Audit. September 2010

WILPINJONG COAL MINE, MUDGEE

Environment Sustainability Unit, Industry & Investment NSW.

111 Prepared by: Scott Brooks

C,) Control Copy Document No: 1

- 01 01

Date: 9-1 0th September Page! of 11

Audit Report - Wilpinjong Coal Mine Industry & Investment NSW

TABLE OF CONTENTS

PAGE

ENVIRONMENTAL AUDIT Purpose............................................................................. 3 Objective 3 Scope................................................................................ 3 Audit Criteria, Evidence and Findings 4 AuditTeam ...................................................................... 4 Audit Timetable ............................................................... 5 Participants in Attendance ................................... 5 Audit Procedure ............................................................... 6 AuditFindings.................................................................. 9 Compliances................................................................... 9 Non-compliances............................................................ 9 Observations..................................................................... 10

APPENDIX 1 - AUDIT CHECKLIST

APPENDIX 2— PLAN OF THE MINE SITE

APPENDIX 3— PHOTOS

APPENDIX 4— AUDIT RESPONSE FROM MINE

Prepared by: Scott Brooks Date: 910th September Control Copy Document No: 1 Page 2 of 12


ENVIRONMENTAL AUDIT

PURPOSE

An Industry & Investment NSW (I&I NSW) Compliance Audit was undertaken at Wilpinjong Coal mine operated by Wilpinjong Coal Pty Ltd (a Peabody company) located at Mudgee. The site was audited as part of a joint Department of Planning (D0P), Industry and Investment NSW (I & I NSW) and Department of Environment, Climate Change and Water (DECCW) environmental performance review on the management of dust from coal mines to improve environmental performance. The audit of Wilpinjong Coal mine was conducted with DECCW auditing against their Environment Protection Licence and I & I NSW auditing the requirements of the Mining Lease including the Mining Operational Plan and Annual Environmental Management Report relating to dust.

The audit inspection was undertaken on 9-1 0th September 2010. The procedures and processes for conducting the Compliance Audits were consistent with details in the Compliance Audit Handbook, which can be accessed on the DECCW website at http://www.environment.nsw.gov.auJresources/ljcensing/cahandbookO6 13 .pdf. This Audit is a controlled document for distribution of the audit agencies and the mine owner/operator. This report has been prepared to present the findings of the audit carried out and no responsibility is accepted for its use in any other context, or for any other purpose.

OBJECTIVE

I The objectives of the audits were: - to determine whether the enterprise is complying with Mining Lease and

Mining Operations Plan Requirements in relation to the audit scope and

I criteria; - to outline a time frame for follow-up action to address any non-

compliances identified during the audit.

SCOPE The area covered by the audit was ML 1573 and covered in the Mining Operations Plan dated October 2008 to January 2012. The subject area is also covered by the Wilpinjong Coal mine Annual Environmental Management Report dated February 2010.



The scope of the audit is limited to the examination of the activities undertaken at the Wilpinjong Coal mine in relation to the management of dust:

Timing, scheduling and sequencing of rehabilitation Vegetative cover and quality in completed areas Landform shape in compliance with the MOP Topsoil management Spontaneous combustion management General compliance with dust controlling commitments identified in the MOP

The temporal scope adopted for assessment of compliance is generally from the commencement of the most recently completed AEMR period or a shorter time where the auditing item can be adequately assessed.

AUDIT CRITERIA, EVIDENCE AND FINDINGS Audit criteria (the requirements against which the auditor compares collected audit evidence) are:

Mining Lease Conditions, Most recent Mining Operations Plan and EDG03 MREMP Guidelines Vs3, Annual Environmental Management Report Industry accepted best practice standards at Wilpinjong Coal mine, in relation to the management of dust and air quality generally.

Audit criteria may include any Management Plan referenced in the MOP.

Audit evidence was collected during discussions with site personnel, examination of documentation provided by the mine and/or contained in I&I NSW files, together with observations made during the audit inspection. Assessment of compliance is based on information supplied by the mine, a review of records and documentation relating to the site.


Audit Report - Wilpinjong Coal Mine Industiy & Investment NSW

AUDIT TEAM

I The audit team consisted of Scott Brooks from the Maitland office of I&I NSW, Environmental Sustainability Unit.

I AUDIT TIMETABLE

I The Audit was announced with around 24 hours given prior to the commencement of the Audit. The Audit for Wilpinjong Coal mine was conducted on the 9th and 10th

September 2010. At the Audit it was advised that the mine would receive a draft of

I the Audit findings within 3 weeks of the audit with the final Audit report and Audits summary completed prior to December 2010.

Timetable for the Audit of Wilpinjong Coal mine

Time Thursday 91h September 2010 9:00am - 10:30am Signing in and relevant staff,

introductions and outlining of the Audit scope

10:30am - 12:30pm Site inspection of the mine. 12:30am- 1:00pm Lunch 1:00pm - 4:00pm Completion of Checklists

Friday 101h September 2010 9:00am - 12:30pm Completion of Checklists and site

inspection to confirm findings 12:30pm— 1:00pm Lunch 1:00pm —2:00pm Joint agency and mine close out meeting

PARTICIPANTS IN ATTENDANCE:

The following staff from Wilpinjong Coal mine were either in attendance at the opening and closing meeting or assisted through the course of the Audit.

Shaun Cleary, Keiren Bennetts, Jason McWhirter, Amanda MacAlpine (Thiess), Sean Mumford (Thiess). The close out meeting was also attended by Keith Downham and Peter Schmidt. Agency attendees at the Audit were;

I&INSW

I

Scott Brooks

DECCW

I Winston Wickremeratne Sheridan Ledger

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I

Audit Report - Wilpinjong Coal Mine

Industry & Investment NSW

Following introductions, the purpose and scope of the Audit was described by the Lead Auditor from each of the 2 agencies. The Audit procedure was discussed, including reference to the identification of compliances, non-compliances and observations as defined below.

The lead Auditors confirmed the Audit would be restricted to the areas of the mine to be audited and the scope was generally associated with activities that can potentially create or lead to dust or a general degradation of air quality.

AUDIT PROCEDURE

The relevance and implications of each of the aspects/activities identified in the Audit Checklist were discussed with mining personnel at the opening meeting and again as the Checklist was filled out. Each of the questions/actions identified on the Checklist were verified by observation, interview and/or documentation to determine compliance with statutory approval, agreed MOP operating procedure and industry best practice. Following the completion of the Checklists a field inspection was carried out to confirm the findings in the Checklists. Following the field visit any additional information required was confirmed and a close out meeting was held to provide mine management with an outline of the preliminary findings.

Compliances, observations and non-compliances were recorded for each of the question/audit actions on the Audit Checklist.

Appendix 1 summarises the results of the audit with respect to each of the elements audited.

The following system was used to categorise findings:




Definition of Audit Outcomes

Compliance (C): adequacy of design and appropriateness of implementation with current Departmental Approvals or Conditions, or compliance with commitments made by the Company.

Observation (0): a finding which is not likely to significantly affect the environment but which could lead to process improvement, further research or reference to pest available practice.

I

Non-compliance: an inadequacy in the design and/or implementation against current Departmental Approvals or Condition. There are 4 subcategories of non-compliance;

Category 1 (NC red) - a total absence of planning or implementation of a required operations element which presents an immediate environmental risk or an isolated lapse in control in the implementation of an operations element which will lead to a significant environmental risk. A Red non-compliance would have a certain or likely chance of high environmental impact or a certain chance of moderate environmental impact.

Category 2 (NC orange) - an isolated lapse or absence of control in the implementation of an operations element which may not be of significant environment risk. An Orange non-compliance would have a less likely chance of a high level of environmental impact, a likely chance of moderate environmental impact or a certain chance of low environmental impact.

Category 3 (NC yellow) - an isolated lapse or absence of control that would not have an immediate effect on the environment and in the long term the effect can be reversed. A Yellow non-compliance would have a less likely chance of a moderate environmental impact or a likely or less likely chance of low environmental impact.

Category 4 (NC blue) - a non-compliance related to an administrative, reporting or monitoring matter.

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Risk Assessment of Non-compliances

The significance of any non-compliances identified during the audit process are categorised. Following risk assessment for non-compliances, an escalating response relative to the seriousness of the non-compliance is determined to ensure the non-compliance is addressed by the enterprise.

The risk assessment of non-compliances involves assessment of the non-compliance against two criteria; the likelihood of environmental harm occurring and the level of environmental impact as a result of the non-compliance. After these assessments have been made, information is transferred into the risk analysis matrix below.

Likelihood of Environmental Harm Occurring

Certain Likely Less Likely

CL E High Code Red Code Red Code Orange

o

Moderat Code Red Code Orange Code Yellow WE e

Low Code Code Yellow Code Yellow Orange

w

The assessment of the likelihood of environmental harm occurring and the level of environmental impact allows for the risk assessment of the non-compliance via a colour coding system. A red risk assessment for non-compliance denotes that the non-compliance is of considerable environmental significance and therefore must be dealt with as a matter of priority. An orange risk assessment for non-compliance is still a significant risk of harm to the environment however can be given a lower priority than a red risk assessment. A yellow risk assessment for non-compliance indicates that the non-compliance could receive a lower priority but must be addressed.

There are also a number of licence conditions that do not have a direct environmental significance, but are still important to the integrity of the regulatory system. These conditions relate to administrative, monitoring and reporting requirements. Non-compliance of these conditions is given a blue colour code.

The colour code is used as the basis for deciding on the priority of remedial action required by the licensee and the timeframe within which the non-compliance needs to be addressed. This information is presented in the action program alongside the target/action date for the non-compliance to be addressed.

While the risk assessment of non-compliances is used to prioritise actions to be taken, I&I NSW considers all non-compliances are important and licensees must ensure that all non-compliances are addressed as soon as possible.

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Audit Report - Wilpinjong Coal Mine Industry & hivestment NSW

Explanation of the Checklist The purpose of this Audit, from an I&I NSW perspective, is to ensure compliance with Mining Lease, Mining Operations Plan and AEIVIR requirements. The first step in this process is to determine what is required within these documents. To do this the requirement needs to first be asked, and then as a second step, determine if the requirement has been implemented on the mine. Where a mine does not have a requirement for a particular activity or aspect, then the answer will be No. This is neither a compliance nor non-compliance. As an example it is asked if the MOP has a requirement for dust suppression on the coal stockpiles. If this issue is silent in the MOP then the answer is No and the answer to the next question is N/A as there is no requirement to implement this action as it is not identified in the MOP. Whether this issue should be covered in the MOP or not is a matter to be considered as a part of the MOP acceptance process and is outside the scope of the Audit.

AUDIT FINDINGS

The I&I NSW Audit Team identified 66 aspects, as part of the Audit Checklist, to audit at Wilpinjong Coal Mine.

The Audit findings were as follows;

29 Compliances were identified and documented in the Checklists.

6 Non-Compliances were identified and are discussed in more detail below.

1 4 Observations were made arising from auditing of aspect questions. These Observations are summarised on the checklists and discussed in more detail below;

I COMPLIANCES

Compliances identified of the activity/aspect are either acknowledgement that the

I documentation requested exists, or was found satisfactory from a dust or air quality perspective.

I Non-Compliances identified consisted of yellow and blue non-compliances. The

I recording of non-compliances and corrective actions taken by the mine are to be presented in the next Annual Environmental Management Report.

I N/C Yellow 1. Mining Sequence not compliant with the MOP Mining in not identified to be occurring south of the suspended Pit 2 workings in

I the current MOP period. The inspection found that 2 pits had been recently constructed. One was east of the coal pad and the second was further east of


I


this. Both pits had been mined for coal. The purpose of the Mining Operations Plan is to identify in both time and space where mining is to occur on the mine site. Opening up extra pits will increase the cumulative affect of the mine on the environment and this would not have been taken into account in the assessment of the MOP. Negotiations to amend the MOP need to be commenced with I&I NSW.

Behind MOP commitment for rehabilitated area The area of completed rehabilitation is behind the area outlined in the MOP. There were 4 N/C's relating to an insufficient area of rehabilitation. Only around 60% of the area identified to be rehabilitated in the MOP in 2009 has been completed. Given the area of disturbance equals or exceeds the area outlined in the MOP, the larger than planned area of bare ground could lead to the production of more dust. The rate of rehabilitation needs to be sped up to match the MOP.

Spontaneous Combustion Spontaneous combustion is occurring in at least 2 locations on the mine. The MOP refers to a Spontaneous Combustion Management Plan. In this plan it describes that inert soil is to be placed over affected areas. An area on the sound bund was affected by spontaneous combustion and was not treated with inert soil. All spontaneous combustion areas should be managed as required in the Management Plan.

OBSERVATIONS

Observations in this Audit are presented in 2 categories: Checklist Observations General/field Observations.

Checklist Observations. Where an item is considered compliant with an Activity/Aspect on the Checklist, but warrants comment, an Observation is recorded.

GenerallField Observations. Where an Activity/Aspect is observed but will have no effect on the likelihood of dust or poor air quality, a General Observation is recorded. Further if something relevant to the Audit is observed outside the area to be audited, a General Observation is recorded.

Checklist Observations 1. Access tracks Condition 20 of the Mining Lease requires access tracks to be constructed to Department of Planning requirements. These standards could not be found so track standards outlined in the Thiess document "Design and Construction of

Prepared by: Scott Brooks Date: 9-1 0th September Control Copy Document No: 1 Page 10 of 12

I Audit Report - Wilpinjong Coal Mine Industry & Investment NSW

I Mine Roads was taken as the required standard. This document was very

I comprehensive. The tracks were found to be constructed to a satisfactory standard but they did require maintenance. A number of drains were either eroded or blocked with sediment.

I 2. Topsoil stockpile recording. There were 2 observations regarding topsoil recording. Both the MOP and

I AE1\'IR contained a section outlining topsoil storage records. The MOP identified the topsoil volumes planned to be stripped in the MOP period only. It did not show quantities of topsoil carried into the MOP period or topsoil planned

I

to be used for rehabilitation. The AEMR only showed the quantities of topsoil used. The purpose of both documents is to allow a topsoil budget to be created in the MOP and the AEMR report against this budget to ensure the use of topsoil is

I

monitored to prevent a shortfall at the end of mining.

Mapped areas of Spontaneous Combustion.

I As the site contains 2 areas of spontaneous combustion in the overburden stockpiles, a plan is needed to locate these areas, so their size and location can be monitored. The only known areas are well monitored and it is acknowledged that an infra red site survey is planned to be completed shortly on locating the

I known and any unknown areas. This survey needs to be started shortly.

General Observations

I GOA The site was very wet for the duration of the Audit. This prevented any

I dust from being created and most of the equipment was idle due to wet conditions. This made it very difficult to asses management practices to reduce the risk of dust.

The site had a very large area of disturbance relative to the size of the mine. More care is needed to ensure the disturbance footprint is kept to a minimum. Once land is disturbed, and not planned to be re disturbed in the foreseeable future, it should be sown with grass to remove the risk of erosion producing sediment and dust.

APPENDICIES Appendix 1 Audit Checklist

- Appendix 2 A plan showing the state of the mine in recent time of the Audit. Marked on this plan

Ican be found the location of the photographs taken.

Appendix 3

IPhotos taken during the Audit with captions.

Prepared by: Scott Brooks Date: 9-1 01h September Control Copy Document No: 1 Page 11 of 12

I


Appendix 4 Audit response from mine.


APPENDIX 1

AUDIT CHECKLIST

ANN.,; I n d u s t r y & NW Investment

Environmental Audit Checklist WILPINJONG

Element: Mining Lease Conditions Audit Date: 910TH September 2010 Auditor: I&I NSW Team, Scott Brooks Audit Reference:

Activity/Aspect Source Question/Audit Action C omment/- Result ML 1573 Verification

unless marked

otherwise Mining Operations 27 Is a current Mining Operations Yes C Plan Plan with text and stamped

plans available for review. Contents of MOP 27b Are Areas of disturbance Yes C

identified in the MOP.

AEMR requirements 28 Has an AEMR has been Yes C submitted for review within the last 12 months of this Audit.

Dust Does the mining lease have any No conditions particularly relating to the control of dust.

Strategic Environmental Compliance and Performance Audit, Mine Wilpinjong. File No. 09/129 1 Date: 9-9-2010 Mine Representative: Lead Auditor: Scott Brooks

Page lof 13 pages

Mining Lease Condition

Mine Name: Wilpinjong Mine

Activity/Aspect Source Question/Audit Action ConmTlent/ Verification Result

Dust If so have precautions been N/A taken to abate dust nuisance.

Dust Provide examples of N/A precautions taken.

Dust Have there been dust N/A complaints received by the mine in the last 12 months. If so how many.

Access tracks C20 Have access tracks been Track were audited against Thiess C designed in accordance with Design and Construction of Mine specifications provided by DoP. Roads, as no DoP document was

available Access tracks C20 Does the mine have evidence Yes, but they require maintenance 0

that the access tracks have been due to poor drainage constructed in accordance with DoP.

Exploration C15 Has any exploration occurred No outside the mining footprint within the mining lease in the last 2 years.

Strategic Environmental Compliance and Performance Audit, Mine Wilpinjong. File No. 09/1291 Date: 9-9-2010 Mine Representative: Lead Auditor: Scott Brooks

Page 2of 13 pages

4iWb - - NW Investment


Element: Mining Operations Plan Audit Date: 9101h September 2010.

Please note that the Auditor: I&I NSW Team, MOP includes all Scott Brooks listed Management MOP Dated October 2008 - Plans January2012

Audit Reference: Activity/Aspect Source Question/Audit Action Comment!- Result

Verification Areas of disturbance MOP Are the areas of disturbance of This will need to be checked from C

the mine within the areas of the latest mining progress plan disturbance identified in the Yes, mining was within the identified MOP. extraction area.

Mining sequence MOP Is the mining sequence No. Pit 2 Box cut south being 2 N/C identified in the MOP pits not on the MOP consistent with the progress of mining as at the date of the audit.

Strategic Environmental Compliance and Performance Audit, Mine Wilpinjong. File No. 09/1291 Date: 9-9-20 10 Mine Representative: Lead Auditor: Scott Brooks

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Mining Operations Plan


Activity/Aspect Source QuestionlAudit Action Comment/Verification Result

Tailings/waste MOP Is the tailings/waste disposal Yes C disposal location identified in the MOP

consistent with the progress of mining as at the date of the audit.

Tailings Disposal MOP Are there any provisions in the No MOP for the management of dust on tailings dams and if so have they been applied.

Coal waste disposal Does the MOP require the No prompt burial of coarse reject and if so what measures (dust) are being implemented for handling and disposal.

Surface infrastructure MOP Are the surface infrastructure Yes C items identified in the MOP consistent with the progress of the mining operation as at the date of the audit.

Rehabilitated areas. MOP Are the rehabilitated areas No. The area rehabilitated was N/C indicated in the MOP consistent significantly (around 40%) behind with the most recent AEMR the MOP requirements. Report

Rehabilitated areas MOP If not, are the total areas No N/C identified in the 2 documents as rehabilitated in the last 2 years consistent.

Strategic Environmental Compliance and Performance Audit, Mine Wilpinjong. File No. 09/129 1 Date: 9-9-20 10 Mine Representative: Lead Auditor: Scott Brooks

Page 4of 13 pages



Activity/Aspect Source Question/Audit Action Comment/Verification Result

Rehabilitated areas MOP Are the rehabilitated areas No N/C indicated in the MOP consistent with the rehabilitation in the field as at the date of the audit.

Rehabilitated areas MOP If not are the total areas No N/C rehabilitated consistent with the MOP commitment. ie have the areas identified to rehabilitate moved.

Landform MOP Are the rehabilitated landforms Slopes not shown in either document (slope and drainage) indicated in the MOP consistent with the most recent AEMR report.

Landform MOP Are the rehabilitated landforms Slopes should be a maximum of 1:6 C (slope and drainage) indicated (10.2) degrees. in the MOP consistent with the The 2 areas checked were 7 and 8 rehabilitation in the field as at degrees. the date of the audit.

Landform MOP If not are the landform areas N/A consistent with the MOP commitment. ie have the steep areas identified moved.

Overland conveyors MOP Does the MOP include dust No suppression requirements on the coal conveyors on mine site.

Strategic Environmental Compliance and Performance Audit, Mine Wilpinjong. File No. 09/129 1 Date: 9-9-2010 Mine Representative: Lead Auditor: Scott Brooks

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Overland conveyors MOP If applicable have these dust N/A suppression systems operated within the last 7 day or can be made operational at the time of the audit.

ROM and product MOP Does the MOP include dust No stockpiles suppression requirements on the

ROM and product stockpiles. ROM and product MOP If applicable have these dust N/A stockpiles suppression systems operated

within the last 7 day or can be made operational at the time of the audit.

Blasting MOP Does the MOP include dust or No fume mitigation measures for blasting.

Blasting MOP Have these measures been N/A implemented in recent blasts. View blast record of the last week.

Blasting MOP In the blast records is fume Yes, All blasts are recorded on video C recorded.

Blasting MOP Where fume is recorded are the Yes, Anomalies on blast are recorded C probable causes recorded for and actions were described at audit. future management decisions.

Air Pollution MOP Does the MOP contain any MOP refers to Air Quality general requirements to prevent Management Plan. air pollution or contain it within the mine site.


Page 6of 13 pages




Air Pollution MOP Have these requirements been Yes C implemented recently.

Spontaneous MOP What are the measures to The Spoil Corn Management Plan C combustion manage spontaneous covers a number of treatments

combustion. including covering affected areas, track rolling and compacting areas, extinguishing fires with water, etc.

Spontaneous MOP Have these measures been No, Spontaneous combustion was N/C combustion implemented in the most recent observed in the sound bund. This

AEMR period, could be covered with soil. Spontaneous MOP What measures are used to The workings are very shallow and C combustion selectively handle and dispose easy to clean up. All overburden

of coal partings/rib coal. material is covered with 2m of inert overburden.

Are areas of spontaneous No, but incident reports are 0 combustion mapped and how completed on the 2 affected areas often are these updated. (report dated 12-7-20 10 sighted) and

mine is to be flown with thermal imagery cameras.

Bushfire MOP Does the MOP contain Yes C measures to prevent bushfire

Bushfire MOP Have these measures been Yes C implemented in full on the mine site.

Bushfire MOP Does the MOP contain Yes C measures to manage the outbreak of bushfire once burning on the mine site.

Bushfire MOP IHave these measures been No, there have been no fires on site.


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implemented on the mine site Bushfire Has there been a planned fire in Development Consent does not allow

vegetative material on the mine fires on site. site in the last 2 years.

Bushfire Would this fire be considered N/A best practice for the management of vegetation by the audit team.

Topsoil Management MOP Does the MOP contain Yes C measures to manage the stripping, stockpiling and spreading of topsoil.

Topsoil management MOP Have these measures been Yes C implemented in the most recent AEMR period.

Topsoil management MOP Have the topsoil stockpiles been Yes C revegetated.

Topsoil management MOP In what time frame is a Not stated in MOP but 6 months stockpile sown after placement stated in AQMP of disturbance.

Topsoil management What is the maximum height of 2m C the topsoil stockpiles.

Topsoil management Does the vegetative cover on No. two stockpiles inspected. C the topsoil stockpiles contain weed content greater than 50% of the cover.

Topsoil management topsoil stockpiles have a tnimurn

Yes, for all except a recently sown C 70% vegetative area.


Page 8of 13 pages




cover. Topsoil management MOP Are records of topsoil stored Topsoil budget is provided in MOP 0

Guidelines and used on site recorded in the but only includes the total topsoil MOP. planned to be stripped.

Erosion and sediment MOP Are the soil and water Yes, fortnightly C control structures regularly inspected. ___________ Erosion and sediment MOP If so are the fmdings and Yes, Document dated 8th September C control actions recorded. sighted. Exploration MOP Does the MOP contain No.

requirements to manage the drill pads and exploration access roads.

Exploration MOP Have these measures been N/A implemented on exploration sites within the last AEMR period.

Exploration Have practices occurred on drill There where no exploration drill pads pads and exploration access found on site. roads to minimise the production of dust.

Strategic Environmental Compliance and Performance Audit, Mine Wilpinjong. File No. 09/1291 Date: 9-9-20 10 Mine Representative: Lead Auditor: Scott Brooks

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44 1*O

Industry& NW Investment


Element: Annual Environmental Management Audit Date: 9101h September Report 2010.

Auditor: I&I NSW Team, Scott Brooks Audit Reference:

Activity/Aspect Source Question/Audit Action C omment/- Result Verification

Site inspection AEMR Has an inspection by I&I NSW Yes, in April 2010. C been carried out following the submission of the most recent AEMR.

AEMR actions AEMR Have the required actions by the The only action listed was to C mining company listed in the improve the rehabilitation description I&I NSW AEMR inspection in the AEMR report. This was done. outcomes been completed.

Topsoil management AEMIR Is the topsoil used and/or Yes, only topsoil stockpiled during 0 stockpiled recorded in the the year was shown. AEMR report,

Mine Closure Plan Has a Mine Closure Plan been Yes, A Closure Plan is listed to be requested from the mining provided to the Dept of Planning in company February 2011.

Strategic Environmental Compliance and Performance Audit, Mine Wilpinjong. File No. 09/129 1 Date: 99-2010 Mine Representative: Lead Auditor: Scott Brooks

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Mine Closure Plan Has this Mine Closure Plan N/A been submitted to I&I NSW, in the time frame requested, for review.


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.4. Industry &

NW Investment Environmental Audit Checklist WILPINJONG

Element: Best Practice/Standards Audit Date: 9_101h September 2010. Auditor: I&I NSW Team, Scott Brooks Audit Reference:

Activity/Aspect Source Question/Audit Action Comment/- Result Verification

Grass cover ML 31 Is sown grass cover >70% for 2 areas of rehabilitation checked. C stability and sustainable Pit 1 most northern rehabilitation growth? Note this should only 70% cover with 100% cover on flat apply to grass covers over 12 surfaces. Pit 1 south eastern area months old. 70% cover, both of Rhodes grass

Tree cover ML 31 Is tree establishment and cover Trees sown in 2008 on the most C stable and sustainable as native northern area were inspected and system? Note this should only they were progressing well. apply to trees old enough to be established.

Weeds ML 31 Is there weed infestation that Most northern area 0% weeds C exceeds 10% of the surface South eastern area less than 5% area? weed.


Page 12of 13 pages





Page 13of 13 pages

APPENDIX 2

I PLAN OF THE MINE SITE

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Location of the photos Ito 12— Wilpinjong Dust Audit- 910th September

APPENDIX 3

PHOTOS

Wilpinjong Audit Photos - 9th and 10th September

- Photo 1_Wilpinjong Keila dump. This out of pit emplacement is affected by Spontaneous combustion and is starting to erode. It is very visible from the nearby road.

"Now a - - -

Photo 2Wilpinjong: Area of spontaneous combustion on the sound bund.

Photo 4Wilpinjong: Pit 2 South facing north.

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Photo 6_ Wilpinjong: Pit 2 South western pit facing west towards the ROM stockpile.

Photo 5_Wilpinjong: Pit 2 south facing south.

-...........V ............ VVt------------------ -

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Photo 7 Wmjong: Pit 2 South Western pit facing north.

- - - -V---- -

Photo 8_Wilpinjong: Pit 1 rehabilitation most north face 70% cover and no weed. 7 degrees slope.

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Photo 9_ Wilpinjong : Pit 1 rehabilitation most north face 2008 rehabilitation

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Photo lO_Wilpinjong: Pit 1 Rehabilitation eastern side south 8 degree slope

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Photo li_Wilpinjong: Pit 1 rehabilitation eastern side south 70% cover less than 5% weeds 8 degree slope.

Photo 12_Wilpinjong : Top of Magazine stockpile showing recently sown grass cover

APPENDIX 4

AUDIT RESPONSE FROM MINE I

11

Wiipinjollg Coal Mine

VA'II

21st October 2010

Minerals & Energy Division P0 Box 344 Hunter Region Mail Centre NSW 2310

Attention: Scott Brooks

Dear Scott,

Re: Draft Compliance Audit Report - Management of dust from coal mines ML 1573

We refer to your correspondence (your reference 09/1291)offering Wilpinjong Coal the opportunity to respond to the findings presented in the Joint Strategic Environmental Compliance and Performance Review on the Management of Dust on Coal Mines report. In association with the comments provided below Wilpinjong Coal will shortly be submitting a MOP variation to the Department of Industry & Investment (DII) which will address the issues raised during the above audit.

Non-Compliance yellow.

I

Rehabilitation status We acknowledge that the amount of rehabilitation completed has not reached the targets as nominated in the current Mine Operations Plan. The quantity of rehabilitation conducted at

I Wilpinjong has been discussed with DII during the 2009 AEMR review meeting held at Wilpinjong on llhhl April 2010, attended by Michael Young. The Mine Operations Plan variation soon to be lodged with DII will nominate new and achievable rehabilitation targets.

Spontaneous Combustion Spontaneous combustion does occur from time to time onsite, we work with the Operator of the mine, Thiess Pty Ltd to continue to manage our spontaneous combustion issues. The timing of the audit coincided with works being conducted on the noise bund. Inert material has been spread over the Northern, Eastern, Southern and top of the noise bund, capping those areas. Work is continuing on the Western side of the noise bund to allow for its capping with inert material. This will result in the noise bund being fully capped, which is in accordance with management techniques nominated in the Spontaneous Combustion management plan.

Checklist Observations. Access tracks - drains eroded or blocked with sediment. The Wilpinjong Coal Mine has a number of access tracks, as the site is working towards total separation of heavy and light vehicles on site. The Operator of the Mine believes that the use of Light and Heavy Vehicle separation is the best way to eliminate serious safety risk in this area. Access track drains are inspected and cleaned on a rotine basis, we acknowledge that a number of road drains have been affected by recent rainfall events.

Wilpinjon

g Coal Mine Ny Ltd Registered Office: Postal Address 259 Queen Street Locked Bag 2005 Brisbane QLD 4000 Mudgee NSW 2850

ACN 104 594 694

Phone: +61 2 6370 2500 Fax: +61 2 6373 4575

Wiipinjollg Coal Mine

Mapped areas of Spontaneous Combustion. Wilpinjong Coal has commissioned thermal mapping of the operation to confirm, monitor and assist in the management of areas prone to spontaneous combustion. Mapping of the site has been delayed by the less than favourable weather conditions.

General Observations. Stripped areas to be sown with grass. Wilpinjong acknowledges that areas of land are stripped in preparation for mining. Wilpinjong will be undertaking trials to determine the most effective form of dust suppression on these stripped parcels of land.

Corrections to Department of Industry & Investment's report arising from the "Joint Strategic Environmental Compliance and Performance Review on the Management of Dust on Coal Mines". Upon review of the above report Wilpinjong suggests the following adjustments:

Page 3 of 11, paragraph titled "Purpose" - DoP didn't not take part in the audit conducted at Wilpinjong Coal on September 9 & 102010. Page 5 of 11, paragraph titled "Participants in Attendance" - Change of spelling for Keiran to Kieren and McWirter to McWhirter. Page 6 of 11, 1st paragraph - only two lead auditors described the purpose and scope of the audit at Wilpinjong Coal.

Please do not hesitate to contact me on (02) 6370 2513 if you have any queries, and thank you for the opportunity to comment on the above report.

Yours faithfully Wilpinjong Coal Pty Ltd

SHAUN CLEARY Environment and Community Manager

Wilpinjong Coal Mine Ply Ltd

ACN 104594694 Registered Olfice: Postal Address: 259 Queen Street Locked Bag 2005

Phone: 4-61 2 6370 2500

Brisbane QLD 4000 Mudgee NSW 2850

Fax: 4-61 2 6373 4575

eis 155 abo3 1133 wilpinjong coal mine, mudgee

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