Dubbo City Council would capture more than $9.9 million from a mining company in a 20-year period to protect its asset base under a proposed agreement between the two parties.
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Australian Zirconia Limited (AZL) has sought to offset the impact of the construction and operation of its $1 billion project at Toongi by offering a monetary contribution to Dubbo City Council.
A sum was calculated by the council's environmental services division to cover the impact of the mine, regarded as having potential to create up to 250 ongoing jobs if approved.
AZL, an Alkane Resources subsidiary, had agreed to the contribution, included in a draft Voluntary Planning Agreement (VPA), division director Melissa Watkins said in a report to a council committee this week.
In a VPA, a developer agrees to provide or fund public amenities and public services, affordable housing, transport and other infrastructure, or to undertake works to offset or mitigate impacts from a development.
The council undertook detailed analysis and modelling of the potential impacts on the city of the project, based on the environmental impact statement prepared by AZL, Ms Watkins said in her report.
Two items were identified that were not covered by any existing contributions plan.
They were the actual cost of maintaining Obley Road as a direct impact from AZL's operation, and contributions to upgrading a section of Boundary Road and Keswick Parkway south to Sheraton Road to "support affordable residential development in this area to accommodate the additional calculated dwellings resulting" from the project.
"Such model assesses the impact of a major development and based on the outcomes council has identified a need to provide for additional, critical, unplanned and unbudgeted infrastructure to support the Dubbo Zirconia Project," Ms Watkins said.
"These projects would have a significant community benefit in facilitating residential development to meet some of the demand determined to be generated by the Dubbo Zirconia Project."
The works and services committee recommended accepting the offer from AZL generally in accordance with the draft VPA.
The draft would need to go on public exhibition for at least 28 days with an explanatory note, if endorsed by the council next week.
"In addition to paying for the upgrade of Obley Road to accommodate their development, Australian Zirconia Limited has agreed to pay $614,000 annually for the maintenance of Obley/Toongi Road, contributions to Urban Road S94 Contributions Plan and for the extension of Boundary Road," committee chairwoman Lyn Griffiths said.
"Over the next 20 years of the Dubbo Zirconia Project this would equate to $9,980,000 in monetary contributions to council from Australian Zirconia Limited."
