A REPORT which suggests mining and coal seam gas exploration poses little threat to NSW water supplies is expected to draw heavy criticism from farmers and environmental activities across the state.
The Namoi Catchment Water study found mining had not damaged water systems downstream from mining developments and was unlikely to do so in the future.
It did not, however, outline the risk of damage to aquifers, possible river contamination and isolated water pollution.
"At current levels of development, extensive regional scale impacts on water resources are unlikely," the report read.
"More scale impacts are likely and the cumulative effects of numerous developments in close proximity will increase the risk to the water resources in those local areas".
According to the Herald NSW Minister for Resources Chris Hartcher said the report showed mining and farming "could coexist if managed carefully".
The report was commissioned by the State Government and focussed on the impact of mining on the Namoi water catchment near Liverpool.
The NSW Farmers Association believes the report only confirms the need for well police government policy to be implemented before permits are granted anywhere else in the state.