Cobbora in western NSW, about 22km south west of Dunedoo. The project application covers 288 square kilometres and it is proposed to mine 30 million tonnes per annum run-of-mine coal. The majority of coal produced would be used in the State's power stations to generate electricity.
THE state government will have to begin mining coal at the Cobbora mine to supply power stations by 2015 or face having to pay electricity companies hundreds of millions in compensation.Treasurer Mike Baird revealed the latest "booby trap" left by the previous Labor government in the wake of its botched power sale. Mr Baird has revealed there is a danger of the government facing a compensation bill from the mine as well.
"Should the state not deliver the coal that is contracted, there is a liability figure for the first year of more than $100 million and there is an ongoing figure for the remaining 17 years of the contract," Mr Baird said.Add the Federal Government's ill-conceived Carbon Dioxide tax and....
"Over the term of the contract we could be talking hundreds of millions of dollars that could hit the state, should we not meet the obligations that have been left behind."
Mr Baird said he was "surprised" the previous government had not revealed the Cobbora liability.