Wollongong Coal's revised plans are on public exhibition and involve extracting a smaller amount of coal (3.7 million tonnes) using a less invasive bord and pillar mining technique.

But environmentalists including IRRM say the potential threat to the water catchment from subsidence and the cracking of creek beds remains.

Mr Workman after multiple incidents, the miner has not shown it is able to comply with environmental conditions, and planning authorities have not shown they are able to ensure these conditions are respected.

Read more: Caution urged over further loss from Illawarra drinking water catchment

"Illawarra Residents for Responsible Mining does not have any confidence that NSW Planning has the capacity to administer the proposed mining at Russell Vale," IRRM spokesman Gavin Workman said.

"Wollongong Coal had an appalling record of non-compliances and failures at the colliery site.

"From past performance it is clear that both the NSW Government and Wollongong Coal Ltd have fallen short of good practice and good governance."

Wollongong Coal has been contacted for comment but has not responded.

Mr Workman said the expansion plan was "a ghost of its former self" but still had potential to damage the catchment and suburbs.

"Our forebears had the prudence to set aside 16,000 hectares of land in the south to secure Greater Sydney's water," Mr Workman said. "IRRM believes that no level of risk is acceptable in the vital Sydney water catchment special areas."