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NT Supreme Court upholds mining minister's decision to slash McArthur River Mine security bond

Jack Green says he's worried about what the decision means for the country and waterways surrounding the mine. (ABC News: Michael Franchi)

Environmentalists and native title holders have lost a battle against a decision to slash the rehabilitation bond for one of the world's largest lead and zinc mines.

Northern Territory Mining Minister Nicole Manison made the decision to reduce the McArthur River Mine's $520 million security bond by $120 million in late 2020.

At the same time, the minister approved an expansion of the mine's waste rock dump and open-cut pit with an amended mining management plan.

This plan was also challenged in court.

On Friday morning, Justice Judith Kelly dismissed the application to quash the decision in the NT Supreme Court.

"The plaintiffs have failed to establish that the decisions of the Minister which have been challenged in this proceeding have not been made in accordance with the mandatory requirements in the [Mining Management Act] or that the decisions are unreasonable," the judgement said.

The McArthur River Mine's security bond was reduced by about $120 million in 2020. (ABC News: Michael Franchi)

The case was launched by Environment Centre NT, Gudanji woman Josephine Green and her husband and Garawa elder Jack Green, who live in the nearby town of Borroloola about 900 kilometres south-east of Darwin.

"Our argument was that the security bond calculation was inadequate to rehabilitate the site and that the closure plan was also inadequate because it didn't cover the life of the mine, it just covered the next 12 months," Environment Centre NT executive director Kirsty Howey said.

"This is a decision that's devastating for people in Borroloola."

Mr and Ms Green said they wanted to ensure enough money was set aside to properly rehabilitate the site after mining activities ended, especially given the region's potential for severe weather and flooding.

"If the company walks away tomorrow or the next day it's going to leave us with more problems in the Borroloola region, along the coast," Mr Green said.

"That's the thing I'm worried about. What's going to happen in the future?

"We don't have any money to pay for any damage and we're the ones that are going to be suffering."

Nicole Manison has previously said the public can have confidence in the mine's level of environmental scrutiny. (ABC News: Kaiden Reid)

Ms Howey said the decision was also a blow for taxpayers and could set a precedent for future mines.

She also said NT government promises to reform mining legislation had been put "on ice" and the case demonstrated the need for urgent amendments.

"The effect of this is that mining companies do not need to pay a security bond that reflects the actual cost of rehabilitating a site," she said.

"This leaves taxpayers and communities holding the can for the cost of paying for the rehabilitation of these sites."

"Estimates were given prior to the case being taken on that it would cost in excess of $1 billion to actually rehabilitate the site."

The mine is near the remote town of Borroloola. (ABC News: Michael Franchi)

She said the Environment Centre NT and the native title holders would get legal advice about the potential for an appeal.

The Glencore-owned McArthur River Mine in the territory's remote gulf region has been the site of several major environmental scandals, including the spontaneous combustion of toxic waste rock in 2013.

In a statement to the ABC, Glencore said the mine would continue to comply with all of its legal and regulatory obligations.

Ms Manison's office was contacted for comment.

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