Since the application for the Dendrobium extension was submitted in 2019, several parties have argued that the viability of the steelworks relied on South32 winning approval to extend the mine's life.

Resources Minister Paul Toole on Saturday said it was a "critical source of coking coal" which justified naming the mine State Significant Infrastructure.

But Cr Cath Blakey said comments made at a recent "virtual town hall" meeting about BlueScope's blast furnace reline showed if the Government was relying on the threat to the steelworks, it was overblown.

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BlueScope's general manager of manufacturing David Bell told the audience significant work on the wharves had been performed which would allow the steelmaker to bring in coal from elsewhere if need be.

"It's a bit of pre-work we're doing to enable us to continue operations," he said.

"It's tied in to the blast furnace to the extent that it's going to to bring coal in should we have more difficulties with the local coal supply due to Dendrobium next domain not being approved.

"There's lots of other projects going on and we've got a bright future for the region and for steelmaking in the Illawarra."

Cr Blakey said "BlueScope have been making contingencies to get coal from other sources ... so Dendrobium not going ahead is not an existential threat to BlueScope's operations at Port Kembla".

The Mercury asked South32 several times if its position was that the steelworks would be threatened if Dendrobium could not be extended. A spokesman did not answer, instead referring to sections of its planning documents.

In its 2019 Environmental Impact Statement South32 said "BlueScope has previously noted that without local metallurgical coal suppliers it may struggle to remain economically viable at Port Kembla".

The miner's new scoping study for the revised Dendrobium project includes quotes from consultant BAEconomics which said the ongoing viability of steelmaking and coal shipping in Port Kembla was "critically dependent" on the continuing success of South32's local operations.

In other areas it says South32's coal is "significant" or "important".

The Independent Planning Commission was not convinced the steelworks depended on Dendrobium's expansion, given the Wongawilli Seam coal would be running out soon.

"The Commission does not accept the suggested dependence of BlueScope steelworks on ongoing access to the Wongawilli Seam coal from this project," the IPC said while refusing the Dendrobium extension in February.

BlueScope was asked about the threat to the steelworks given the new wharf facilities, but did not respond. In February BlueScope said: "Local coal supply remains very important to the economics of the Port Kembla Steelworks' future. The more supply options that are available, the better for the steelworks."

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