Environmental groups have welcomed the establishment of an independent panel to examine coal mining in Sydney's water catchment but have called for a moratorium on any expansion until its conclusions are in.

The Berejiklian government on Friday announced the panel of five experts - to be chaired by the NSW Chief Scientist when that person is named - will "look closely at the risks" from the three underground mines.

Water flowing into Woronora Dam has been affected by subsidence under creeks caused by coal-mining underneath. Credit:AFR

"The expert panel will review water modelling and monitoring activities of approved mines in the Special Areas, to ensure they are as accurate as possible," Marcus Ray, Deputy Secretary of Planning Services at the Department of Planning and Environment, said in a statement.

"A highly regarded mining study from 2008, known as the Southern Coalfield Inquiry, will also be updated by the expert panellists, who will apply the latest scientific knowledge to mining operations in the catchment."