A mine expansion in NSW is set to run under a vital Sydney water catchment. 

The NSW Government has approved plans for a seven-kilometre-long access road under Sydney Water's second largest water storage dam.

The approval will allow Wollongong Coal to build a road under the Avon Reservoir to reach a ventilation shaft, as part of new works at the Wongawilli coal mine, which entered into care and maintenance in 2019.

The NSW Department of Planning and Environment says the recently-approved modification will provide 150 jobs over the next five years and raise $3.7 million in royalties.

“This decision follows a rigorous assessment by the department and included advice from WaterNSW and Dams Safety NSW, as well as community feedback,” the department said.

Wollongong Coal is required to prepare a safety management plan for the dam in consultation with both agencies.

It must also prepare a sustainability and emissions strategy, which includes a requirement to reduce or offset emissions by four per cent each year over the extended life of the project.