Anti-mining lobby group Lock the Gate Alliance commissioned a report by EarthScapes Consulting in June which found 45 Aboriginal heritage sites within the three sites.

The report also found 22 threatened fauna species and six threatened flora species including the koala, the critically endangered regent honeyeater and the endangered spotted-tailed quoll.

Mr Toole said it would be pre-emptive to say whether the nearby Ganguddy-Kelgoola region would be discarded and was awaiting further information on the project.

Greens MP Cate Faehrmann, who raised the question in budget estimates on Wednesday, said the move was “wonderful news, particularly as world leaders gather at COP26 in Glasgow and the UN calls for an urgent phase out of fossil fuels. I am now calling on the NSW government to protect this culturally rich and environmentally significant area by adding it to the national parks estate”.

Lock the Gate Alliance NSW spokesperson Nic Clyde said he hoped the decision foreshadowed a more serious move away from opening new land to coal mining from the Perrottet government.

“Ripping apart the farming and tourism-focused district of Rylstone for coal never made any sense,” he said.“It would have transformed this beautiful region that rests against the western flank of the Blue Mountains World Heritage Area into the type of moonscape we now see in places like the Upper Hunter.

“We’re extremely grateful [Mr] Toole has listened to his constituents in the local region.”

The Wilderness Society manager of policy and strategy Tim Beshara, which has campaigned against the project, said the plan should never have been proposed in the first place.

“This never should have gotten this far, it never should have been proposed in the first place,” he said. “It is such an intense relief to see some thoughtfulness and common sense creeping into policy around fossil fuels and we thank the minister for making this call.”

“We hope the NSW government will keep their eyes open as they consider the fate of the adjoining regions. We don’t want this to be a brief relapse into sanity.”

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