The owner of the Russell Vale Colliery, near Wollongong, has revealed plans to seek an extension of the mine just days after South32 shelved its Dendrobium proposal.
South32 announced on Tuesday it would not proceed with its application to extend the mine's life beneath Sydney's drinking water catchment, as it would not generate sufficient returns to justify the investment.
On Friday, Wollongong Resources chief executive officer Greg Pawley confirmed the company would take a contrary approach and hoped to continue mining at Russell Vale for up to a decade.
"We currently are in the process of submitting another extension for another five or 10 years," Mr Pawley said.
"We've been working with the Department [of Planning and Environment] about just what that looks like.
"Our lease has another 20 to 30 years left on it, so it's just the immediate mining areas that we need to work with the community and the government agencies to get further approvals beyond the initial five years."
'Little subsidence'
The company, which is a fully owned subsidiary of Jindal Steel & Power, recently rebranded from Wollongong Coal as it looks to diversify its Australian portfolio.
It received approval last year to extend the life of its Russell Vale mine for five years using a bord and pillar extraction method.
Mr Pawley said he did not anticipate Wollongong Resources would face similar challenges gaining approval due to its use of the less harmful technique, which removes "rooms" of coal leaving "pillars" to support the roof.
"The point to remember is that the process that we're using now is what we're proposing to use for the life of the mine," he said.
"Our mining method has very little subsidence.
"The actual monitoring over the area now, as part of our approvals process, has shown the ground above our mining areas has actually gone up, not down, it's swelled with rain."
South32's proposal had hoped to use the more common longwall method, where a wall of coal is mined in a single slice, at its underground operation.
SSI declaration repeal
The technique has been criticised by environmental groups as the cause of water loss from the catchment and was a factor in the Independent Planning Commission's decision to reject the company's initial proposal.
The state government later took the unprecedented step of declaring the coal project State Significant Infrastructure (SSI) due to its supply of metallurgical coal to BlueScope Steel's Port Kembla plant.
The Planning Department confirmed it was investigating repealing the SSI declaration.
"While the declaration is in place, a future application of the same nature could be lodged," a department spokesperson said in a statement.
BlueScope's chief executive of Australian Steel Products, John Nowlan, said the company was "pretty confident" South32 would be able to meet its contractual obligation to supply the steelmaker until 2032.
But he said it was still unclear what the company's strategy would be beyond that deadline.
"For the greater good of Australia and our employees, that is a really important issue that is going to need to continue to be worked through," Mr Nowlan said.
"What we think is critical is that we continue to have an efficient, competitive local coal mining industry at least up and until the point we can transition to a different technology."
This week South32 posted record earnings of $2.6 billion for 2022 financial year and said it was likely the $700 million investment in the Dendrobium proposal would instead be put towards its US businesses.
Increased production
In contrast to South32's approach, Mr Pawley said Wollongong Resources was hoping to build its workforce in the Illawarra, as it increased production at Russell Vale.
"I've reviewed what the possibilities are of what we can do at this operation and identified that there is potential for additional cutting areas," he said.
"It will need another crew, another continuous miner, and it needs personnel.
"We've potentially got additional crews next year in our business plan too."
