Saddleback Ridge is home to endangered animal and plant species and forms a natural buffer between the Mount Thorley Warkworth mine and the village of Bulga.

While the company acknowledges it ‘‘previously stated [the ridge] would not be mined’’, big increases in coal prices have ‘‘fundamentally changed’’ its view of the area.

‘‘It has become economic to mine and, in addition to creating 150 new jobs, this will provide ongoing employment for our existing workforce ... of more than 1300 people,’’ a Coal & Allied spokesman said.

Nearby residents, such as Bulga Milbrodale Progress Association spokesman John Krey, argue the ridge is protected under a 2003 deed of agreement with the then-minister assisting the minister for planning Diane Beamer.

The mine’s consent shows Saddleback Ridge in a non-disturbance area.

The deed of agreement obliged the company to ‘‘conserve and manage’’ and ‘‘permanently protect’’ land in the non-disturbance areas unless, in ‘‘the opinion of the minister’’, the applicant could justify mining on social, economic and environmental grounds.

The Department of Planning is assessing the company’s application.

Mr Krey said that if the work were to be approved, the ridge would ‘‘become a hole in the ground’’.

‘‘We will be completely exposed to an open-cut mine,’’ he said.

Carol Russell, who with Mr Krey recently addressed Singleton Council on the issue, said the ridge should have been rezoned for conservation.

‘‘The 2003 agreement was supposed to be binding,’’ Mrs Russell said.

If approved, the mine’s extension would remove more than 760hectares of woodland and forest which contain endangered ecological communities.

Coal & Allied said the decision to apply to mine the area had not been taken lightly.

The company is working with University of New England researchers to recreate the significant Warkworth Sands woodland at several locations in the Hunter, including one near Merriwa.

“To offset the disturbance of this land we have a much more significant conservation package, which will deliver the long-term protection or rehabilitation of an area more than eight times in size,’’ the Coal & Allied spokesman said.