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Australian coal licenses revoked amid corruption scandal

World Coal,

Three coal mine exploration licenses in Australia are to be cancelled, as an investigation into the dealings around the granting of the licenses finds they involved corrupt dealings.

The New South Wales (NSW) government will introduce legislation to cancel the exploration licenses for Doyles Creek, Mt Penny and Glendon Brook. The action is in line with recommendations from the Independent Commission Against Corruption (Icac).

In December, Icac recommended that the coal mine exploration liceneses be cancelled.

The recommendation followed corruption findings against former Labor MP Eddie Obeid, former mining minister Ian Macdonald and union official John Maitland.

Premier of the NSW government, Barry O’Farrell, said that no compensation would be provided for the cancellation of the licenses, and that the legislation would compensate taxpayers for any possible claims relating to the issuing or cancellation of the licenses.

“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.”

Coal companies that found themselves caught up into the corrupt dealings around the granting of the licenses had asked the state government not to strike out at their mining licenses.

After the initial corruption findings against Obeid, Macdonald and Maitland, O’Farrell gave holders of the mining licenses a month to convince the government not to cancel them.

Cascade Coal, which holds the licenses for Mount Penny and Glendon Brook, has launched a supreme court bid to have the Icac report annulled. The company has said any recommendation that the coal licenses should be cancelled was “fundamentally flawed”.

Director of Cascade Coal, John McGuigan, criticised any move to confiscate the company’s assets in an open letter penned last week.

“This is not Lenin’s Russia, or Mao’s China, where Lenin and Mao confiscated private property in the name of the state,” McGuigan wrote.

Meanwhile, NuCoal Resources, current holder of the exploration licenses for Doyles Creek, has argued that “the public interest is best served” in allowing the company to retain the license.

Both NuCoal and Cascade Coal have warned that cancelling the coal mine licenses could lead to “lengthy and costly litigation” against the NSW government.

NuCoal argued that the mining project would deliver 350 jobs and more than AU$ 2.6 billion in taxes to New South Wales. The company said it acquired the license in 2010 and was entitled to assume the license had been lawfully granted by Macdonald.

The Doyles Creek license was awarded to Macdonald by Maitland and a consortium of investors in 2008, allowing Maitland, a former union heavyweight, to turn his initial AU$ 165,000 investment into AU$ 15 million. 

Edited from various sources by Sam Dodson

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