Australia's highest court has struck down the approval of a major coal mine expansion in New South Wales, ruling that planning authorities failed to ensure greenhouse gas emissions would be minimised "to the greatest extent practicable". Campaigners say the decision, handed down on Wednesday, sets a binding national precedent for how fossil fuel projects are assessed.

In a 3-2 split ruling, the High Court dismissed an appeal by MACH Energy, the operator of the Mount Pleasant open-cut mine near Muswellbrook in the Hunter Valley, Australia's rural coal-mining heartland. A majority of the judges found that the state's Independent Planning Commission was required to consider conditions that would limit emissions, including so-called scope 3 emissions, which are released when coal is sold and burned overseas. It had not done so. The expansion would have extended the mine's life to 2048 and roughly doubled its output to 21 million tonnes a year. About 98% of its projected emissions are scope 3. The court's reasoning differed from that of an earlier decision by the NSW Court of Appeal, which had also overturned the approval.

The case was brought by retired science teachers Wendy Wales and Tony Lonergan, through their community group, which has pursued it for more than four years. It is the first climate-related case to reach the High Court. "We cannot dig up coal, ship it overseas, watch it drive climate change, and then pretend the consequences have nothing to do with us," Wales said. Their lawyers said planning bodies cannot ignore the chain of causation from a project's emissions to local climate harm, and that the ruling will be studied internationally. Lonergan said it was not the end of coal overnight, but the end of approvals that "look the other way on climate".

MACH Energy, which is owned by a subsidiary of Indonesia's Salim Group, said it was disappointed but accepted the decision and would review the judgment. It said it would pursue all options to keep Mount Pleasant operating, noting that thousands of local residents depend on it for work and that a separate modification approved in August would extend operations by six years. The Minerals Council of Australia called the ruling a blow to the country's ability to meet global demand for its coal, adding that mines may now have to work out how to cut emissions from their export customers.

The implications may extend beyond this mine. Australia is among the world's largest exporters of coal and liquefied natural gas. Sue Higginson, a Greens member of the NSW parliament, argued the ruling could create significant legal difficulty for the Hunter Valley Operations extension, the largest in the state's history, which the planning commission approved a week earlier and whose environmental assessment did not account for scope 3 emissions. Whether and how courts apply the decision to other projects remains to be seen.