O’Farrell, who is widely tipped to lead a coalition government when elections are held in March, hiked through the Dharawal State Conservation Area near Appin earlier this month and declared he would add about 6200 hectares of the bushland to the public estate, despite Illawarra Coal’s plans to dig up coal there over the next 30 years.

The surprise announcement sent shockwaves through the industry, with the Coalition yet to reveal a public policy on mining.

However, leaked correspondence between the Coalition and the NSW Minerals Council shows it had asked the council to help write its Strategic Regional Land Use Planning Policy, which aims to set out processes for determining conflicting mining and farm land-use claims.

The Coalition is believed to be trying to placate the mining lobby while accommodating its core rural constituency and attempting to skim off the green vote in marginal urban seats by stymieing the mining plans of Illawarra Coal.

Illawarra Coal was seen as an easy target as in October it was forced to cut 32% of its mineable coal reserves off the Bulli Seam Operations project to continue the Appin and West Cliff longwall mines.

The company revised its previous mining plans in response to a New South Wales Planning Assessment Commission report released in July, plus submissions from other stakeholders during the environmental approval process.

Illawarra Coal completely removed the North Cliff and Appin Area 2 domains in its new “preferred project report” application.

Shadow primary industry and energy minister Duncan Gay yesterday released a statement claiming the leaked correspondence, which was reported in the Sydney Morning Herald, was part of the policy-forming process.

“The basis of the article will be proven to be wrong when the NSW Liberals & Nationals Strategic Regional Land Use Planning Policy is released in coming weeks,” he said.

“Of course we consult widely on our policies and we make no apologies for that. Consultation is a vital part of the policy development process.

“This policy area requires a balance and we are confident that our final policy, when it's released, will reflect that we've got the balance right. It has been a long process and to say we are beholden to anyone is completely wrong.”

NSW Minerals Council chief executive Dr Nikki Williams said the council had always been a “vigorous advocate of strategic land-use planning to provide more clarity and direction for all industries”

“The NSW Minerals Council and the NSW Farmers Association have been working side-by-side, at the request of the Coalition, to provide advice on the opposition’s strategic land-use planning policy,” she said.

“As the body representing the state’s minerals industry, which directly employs more than 35,000 people, it is wholly appropriate that the NSW Minerals Council is consulted alongside other stakeholders, including the NSW Farmers Association.

“It is up to our political leaders to get the balance right in the development of the state, in the interests of everyone in the community. The final policy is a matter for the Coalition.”

As part of Illawarra’s revised mine plan, the majority of the Appin Area 3 domain and two longwall panels off the West Cliff Area 5 domain were also removed.

The revised plan eliminates underground mining near the Dharawal State Conservation Area plus areas near the Woronora River, Cataract River and O'Hares Creek at the top of the Georges River catchment.

Potential impacts on about 72 kilometres of streams were removed, with 18 streams no longer affected by the new mine plan.

Illawarra removed all 226 upland swamps from any potential impact.

The amount of cliff lines above underground mining areas was cut from 611 to 290.

Aboriginal heritage sites above mining areas were slashed from 632 to 160, including 12 of the 14 with “high archaeological significance”

About 205ha of mapped threatened ecological communities above mining areas were removed, along with 11,360ha of mapped vegetation.

These adjustments are expected to reduce the total recoverable coal reserve from 306 million tonnes of raw coal under the previous plan to 209Mt.

Illawarra is removing subsidence concerns with its new proposal and consequently the amount of coal wash to be emplaced underground under stage four mining will be cut from 40Mt to 26Mt.

This is also expected to cut the emplacement height by 34m.

Illawarra Coal retains the right to apply again for mining over the 30-year life of its lease.