BHP mulls turning closed coal pits into pumped hydropower after securing NSW Government mining approval

BHP will be allowed to mine its Mt Arthur coal pits in New South Wales right up until the operation closes in 2030, and has started studies to potentially build a pumped hydropower project at the disused site.

BHP on Wednesday confirmed it had received approval from the NSW Government to keep mining at Mt Arthur for another four years from July 2026 to June 2030.

At the same time the miner said it had also engaged Spanish construction company Acciona to start studies to convert part of the site into a pumped hydro energy storage project.

It comes three years after BHP decided it would wind down Mt Arthur — the largest coal mine in the State — by the end of the decade, a call that has reportedly put some 2000 jobs on the line.

The thermal coal mine had initially been scheduled to run until 2045. But after failing to secure a buyer, BHP brought the closure forward to 2030 and sought to have its approvals due to expire in 2026 extended for another four years.

The Big Australian sold two coalmines in Queensland in 2023 to Whitehaven Coal as part of its push to exit the fossil-fuel commodity and meet longer-term decarbonisation targets.

BHP claims a new pumped hydro project could call for up to 1000 jobs during the construction phase and power up to 500,000 homes across NSW a day.

BHP President Australia Geraldine Slattery said the mining giant was “working hard to explore alternative land uses” for the sprawling 7000 hectare site.

“The community have told us they want to see Mt Arthur repurposed when mining ends. This study will examine the role pumped hydro at the Mt Arthur site could play in the region’s future,” she on Wednesday said.

Ms Slattery said the miner had also put $30 million into a fund for the community whose livelihoods will be impacted by the closure of the mine.

“BHP is committed to leaving a positive legacy in the Hunter Valley. With our approval to keep mining to 2030 and with a $30 million fund, we’re recommitting to giving the community and our people the certainty and the support they need for the future.”

A pumped hydro project would make use of disused coal pits at Mt Arthur by converting them into to water reservoirs to generate renewable power.

The process typically involves using wind or solar power to pump water uphill to an elevated reservoir. Water in the higher reservoir is released downhill to pass through a turbine using momentum to generate electricity at times of high demand.

BHP shares closed 1.2 per cent lower to $36.07.