The Land and Environment Court upheld Darkinjung Aboriginal Land Council's rejection of mining company Kores's plan to use Darkinjung land for a rail spur to access the Central Coast mine site. The court accepted Darkinjung arguments that approval of the Kores plan would amount to the "compulsory acquisition" of valuable land granted under the Aboriginal Land Rights Act.

Kores had planned to transport 5 million tonnes of coal a year from the mine, for up to 28 years.

Soon after the judgment, the NSW Planning Assessment Commission criticised not only Kores's estimates of the project's economic benefits, but the Department of Planning's uncritical acceptance of the estimates.

A $1 billion difference between the claimed economic benefits of the mine and the likely actual benefits was "staggering".

Dooralong resident and Australian Coal Alliance spokesman Alan Hayes called for an end to the controversial project.

"The Land and Environment Court decision gives the NSW government the means and the perfect out to say 'No' to this project, and honour their pre-election commitment to this community that there would be no mine in our water catchment area," Mr Hayes said.

"Without the rail line over the Darkinjung land, Kores can't build the coalmine."

The Greens NSW mining spokesman Jeremy Buckingham said: "This is a damning report which outlines significant risks to the Central Coast water supply and predicts subsidence which will undermine at least 245 residences as well as other important infrastructure.

"This mine, which was always unwanted by the local community, should be rejected by Planning Minister Pru Goward and abandoned by the proponents."