A NSW coal mine extension was approved despite evidence suggesting it would lead to higher salinity levels than if no mining occurred, the NSW Land and Environment Court has heard.
Conservation group 4nature is trying to prove the discharge from the Springvale coal mine, near Lithgow, is polluting water in contravention of quality laws.
Barrister Richard Lancaster SC told the court that tests before approval indicated the project would lead to an "extravagant increase" in salinity at the discharge point when compared with levels predicted if there were no mine.
"Some 21km away at Lake Burragorang (the city's major water supply) itself there's not insignificant and immaterial increase in salinity," he said.
The conservation group argues the extension's approval in September 2015 was legally flawed and the Planning Assessment Commission (PAC) failed to show it was satisfied the project met a requirement for neutral or beneficial impacts on water quality.
It also says the department of planning and environment declared the project met the neutral-or-beneficial test before referring it to the PAC based on discharges from the existing mine, when it should have considered a "nul" case instead.
But barrister for the mine's owners Neil Williams SC argued the fundamental question was not whether the department's assessment was flawed but whether lawyers for the conservationists could prove the PAC did not reach a level of satisfaction regarding the requirement before approval.
"(There is) powerful evidence the PAC considered the satisfaction requirement," he said.
"The applicant can't make out in their submission that the satisfaction requirement... hasn't been achieved."
Mr Lancaster argued the extension should have been considered as a whole new project, because the mine's main activities were expected to wind down at the end of September 2015 before the approval.
Mr Williams said the mine would still have been allowed to conduct rehabilitation and prospecting activities and it was likely water would have been pumped from the site even without the extension.
Outside court, protesters held signs reading "water more precious than coal" and "save our swamps" before proceedings got underway.
The case is supported by numerous conservation groups and was launched on behalf of 4nature by the Environmental Defender's Office.