Coal exploration licenses could be cancelled in Australia

January 21, 2014

Some coal exploration licenses that were granted in New South Wales, Australia could be cancelled after an independent commission found that they were part of corrupt dealings involving former Labor MP Eddie Obeid, former mining minister Ian Macdonald and union official John Maitland.

New South Wales Premier Barry O’Farrell introduced the legislation to cancel coal mine exploration licenses for Doyles Creek, Mt. Penny and Glendon Brook on Jan. 20 following recommendations from the Independent Commission Against Corruption (Icac), the Australian Associated Press reported.

As part of the legislation, O'Farrell said no compensation would be provided for the cancellation of the licenses and the legislation would indemnify taxpayers from any possible claims relating to the issuing or cancellation of the licenses.

The coal companies embroiled in the Icac inquiry into the corrupt dealings around the granting of the licenses had asked the state government not to strike out their mining licenses, the Australian Associated Press reported.

"This draws a line under this sorry saga of Labor politics and corruption in NSW," O'Farrell's office said in a statement.

"There is no intention to immediately re-release the affected areas but any future process for issuing licenses will be consistent with the NSW government's implementation of the Icac's recommendations on probity."

Icac recommended in December that the licences be cancelled.

Following the findings, O'Farrell gave current holders of the mining licenses a month to convince the government not to cancel them.

Cascade Coal, which has the Mount Penny and Glendon Brook licenses, has launched a supreme court bid to have the Icac report annulled.
In an open letter to the government, Cascade Coal director John McGuigan last week criticized any move to confiscate the company's assets, the Australian Associated Press reported.

In its submission to government, NuCoal Resources argued "the public interest is best served" in allowing it to retain its Doyles Creek exploration license.

It said the mining project would deliver benefits to NSW including 350 jobs and more than $2.6 billion in taxes and royalties for the commonwealth and state.

NuCoal acquired the license in 2010 and previously said it was entitled to assume the license had been lawfully granted by Macdonald.
The Doyles Creek licence was awarded by him to Maitland and a consortium of investors in 2008, allowing Maitland, a former union heavyweight, to turn his initial $165,000 investment into $15 million.


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