Shock jock Alan Jones has warned NSW Premier Gladys Berejiklian that her head is "in a noose" over her government's mining policy in the Liverpool Plains, one that will tighten once "the truckies and the farmers start", in an extraordinarily fiery radio interview.

Ms Berejiklian's government announced on Wednesday it would spend $260 million buying back about 51 per cent of a mining exploration licence over an area encompassing the Liverpool Plains and prime agricultural land, leaving only the adjacent ridges remaining.

Jones, a fierce critic of Chinese state-owned company Shenhua's proposed Watermark coal mine, on Thursday said he believed the limitations would not protect farmland and continued to risk polluting its water.

"The Shenhua rubbish has the potential to bring down [your] government," Jones said in an interview on Sydney radio station 2GB, part owned by Fairfax Media (which also publishes this website).