The draft conditions Buller Coal had offered contained too many "best endeavours" with limited certainty of outcome, the court said. Rehabilitation conditions were unsatisfactory in the form they were written.
The court directed the parties to confer and endeavour to agree by April 19 to a timetable for completing the case. They should address items and conditions the court had highlighted.
The interim decision noted that the court had previously decided it could not consider the impact of climate change from burning coal. That decision had been appealed to the Supreme Court. If it was overturned, the Environment Court hearing could reopen to address it.
Bathurst managing director Hamish Bohannan said the court's interim decision was "excellent news".
The Denniston mine would create stability for Westport, he said.
"It gives it a long-term base industry. We can re-establish the port and get other jobs into the town to give it a long-term future."
Bathurst was already employing about 70 people in Buller. It would employ another 250 when mine development began, building up to 450. It aimed to take on some of Solid Energy's Stockton mineworkers who had lost their jobs.
Mr Bohannan saw no problem resolving appropriate conditions for the Escarpment Mine.
"The conditions are written, it's really just fine-tuning them
"It's all about getting jobs back on the West Coast. The longer it takes the more people will leave."
The main issues were around conditions on re-establishing existing vegetation and ensuring permanent protection of 745ha of land outside the mine.
Bathurst already had a long-term plan for responsible development of the plateau.
"The myth that's out there is we're going to mine the whole plateau and that's not the case - it's less than about 20 per cent of the plateau gets mined."
Bathurst had planned to begin developing the new mine by mid 2013. Mr Bohannan said he hoped that timetable still applied but he did not know when the Environment Court would make its final decision.
"It all depends on whether all the parties work collaboratively together to achieve an end. Obviously it can be dragged out if people choose to drag it out."
He said Bathurst had to review the 120-page decision, respond to the draft conditions, and provide a timeframe to the court within three weeks.
"We've all read through it, we've had a long night. We don't see any roadblocks."
Continuing opposition to the project from environmental groups was the main problem.
"There will always be that opposition. We need to address the climate change gases and how we live, rather than stop using coal, because that's still the mechanism by which most of this planet will get a quality of life."
Bathurst hoped to finalise an access agreement with the Department of Conservation, now that the court had indicated it was likely to grant consent.
Mr Bohannan said the mine project was costing Bathurst around $400 million.
The company had spent about $200m so far on court costs, acquiring leases, buying privately owned mines, upgrading Westport and Taranaki ports, employing staff and providing offices.
It had to spend another $20m at the mine site before it could start producing coal.
As well, it was planning to spend about $175m on a second upgrade of Westport port ($30m), a rail spur ($5m), a conveyor belt ($70m) and a small wash plant ($70m).
Mr Bohannan said if environmentalists won the Supreme Court case it would be an imposition on Bathurst, but would not affect the Denniston project.
The end users of coal produced the climate-change gases and they, not exporters, should pay the carbon tax.
"Essentially what the environmentalists are arguing is it (coal) might go to a company that's not signed up to the Kyoto protocol so we should pay it for them. That would be a world first."
- The Westport News
