Power groups Macquarie Generation, Delta Electricity and Eraring Energy, which were sold off by outgoing treasurer Eric Roozendaal in a $5.3 billion eleventh-hour sale last year, are believed to be concerned about projected coal demand.
The former state government decided to keep and operate the mine, and offer subsidised coal to the generators at a rate below the current market rate after negotiations with Whitehaven Coal collapsed last year.
The government was initially seeking to mine 30 million tonnes per annum of raw coal and produce 20Mtpa of product coal from Cobbora. Open cut mining was slated to start in 2013 for a life of 21 years.
Rob Duffy from the lobby group Mudgee Community Action Network told the ABC that the Coalition's election commitment to hold a judicial inquiry into the sale of electricity assets was delaying the Cobbora project.
"We can only welcome the delay," the ABC reported him as saying.
"I think the general consensus is that we do have enough coal mines around and we wouldn't like to see another one.
"It'll certainly give us an opportunity to have more input into the (judicial) inquiry, Cobbora being one of the elements of the sale."
Duffy said it would allow local campaigners to put their opposition to the project, which they claim would unnecessarily draw upon local water resources and create dust and other environmental hazards.
"The previous government seemed to be in a bit of a rush to do a lot of things,” he said. "It's certainly not being rushed now if it's been put on hold.
"I think the change of government brought that about.
"It'll give us an opportunity to have some say."
The Mid-Western region will join the Wellington and Warrumbungle shires to prepare a joint submission on Cobbora once the environmental assessment is released.
According to the ABC, Mid-Western region general manager Warwick Bennett said all three councils shared the same concerns and would be expressing their views forcefully to the state government.
Developing the Cobbora mine would expose the government to considerable risk and its supply of subsidised coal to newly privatised electricity generators would mean the state would only receive about $700 million from the $5.3 billion headline price, according to a state parliamentary investigation.
The NSW Upper House Committee in its review of the controversial sale found that the state government was effectively guaranteeing the electricity generators coal at $31 per tonne, well below the government supply contract rate, and that the sale should be reversed.
"When you take in the account the [cost of developing the] Cobbora coal mine, another $1.2 billion, and the subsidised coal price … plus damages and so on, we estimate that probably the state – taxpayers – [is] only receiving between $600 and $700 million," committee chairman Fred Nile is reported as saying in the Sydney Morning Herald.
"We believe the loss to the state would be fully balanced up by any compensation payments. For example, the sale means we don't get the profit from the gentrader, which is probably $600 million a year. Multiply that by 10 years and you have $6 billion. So when you take into account the lost revenue, it is far better for the state to rescind the sale and to pay any damages."
In a preliminary report, the NSW Auditor-General Peter Achterstraat said risks to the state included paying liquidated damages if availability targets were not met and shortfall payments if the Cobbora mine was unable to deliver agreed amounts of coal.
Nile suggested that the next state government after the March election should reverse the sale. But the Liberal-National Coalition said it needed to study the agreements before it made any decisions about the future of the state’s power privatisation program.
