The council asked the State Department of Planning to withdraw Huntlee's status as a state significant site, in November, until further information became available on the extent of contamination on the former mining site.

Despite the request, Huntlee will be approved today, by NSW Minister for Planning Tony Kelly, for a state significant site listing and voluntary planning agreement for the Huntlee New Town site.

The listing includes increased environmental protection, monetary contributions for ongoing conservation and the capacity for up to 7500 new dwellings.

Mr Kelly said the development of the site would take place progressively over the next 25 years.

"It will create a major new centre for the region with capacity for around 20,000 people who can live and work within the region, and will go a long way towards achieving the long-term housing targets outlined in the Lower Hunter Regional Strategy," Mr Kelly said.

"The approval does not allow for actual construction to take place, with future development applications needing to be lodged and approved before this can happen."

The site approval will also lead to 200 hectares of mixed-use lands that will create more than 3000 jobs and 5612 hectares of conservation lands to be protected in perpetuity.

Of the land to be protected for environmental conservation, 624 hectares is within the Huntlee site, including a 17-hectare "park" for the protection of the Persoonia pauciflora, a critically endangered plant species.