A $1 billion coalmine extension could lock in decades of supply to Australia's biggest steel maker and not upset state or national plans for achieving net zero emissions by 2050.
"Coal will continue to be part of Australia's economy for decades to come," a spokesman for federal Energy Minister Angus Taylor told AAP.
The Dendrobium coal mine expansion proposed by BHP spin-off South32 was blocked by NSW's planning commission in February because of threats to Sydney's water supply.
Critics also raised concerns over the more than 250 million tonnes of greenhouse gas emissions projected over the life of the project.
But now NSW Deputy Premier Paul Toole has declared the mine extension as State Significant Infrastructure (SSI), citing its importance to Port Kembla steelworks and thousands of workers.
