After six months of being kept under wraps, reports on the impacts of a mine west of Wollongong have been released, revealing "disturbing" fracturing and bulging, putting Sydney's drinking water catchment at risk.

The Dendrobium coal mine is located underneath the metropolitan special area, which provides a buffer zone of bushland around catchment areas to protect drinking water.

As well as seam-to-surface fracturing across parts of the mine, there has been an unexpected finding of valley bulging alongside Sydney's major dams.

This can result in a loss of valuable drinking water from the catchment.

National Parks Association of NSW mining projects officer Peter Turner described the affects to the catchment as "grave, extensive and much more severe than warned of".

"It's now clear why [NSW Department of Planning] withheld these reports from WaterNSW, OEH [Office of Environment and Heritage] and the community for as long as they could," he said.

Mr Turner said the "greatly disturbing" findings speak volumes about the department's values, and financial returns from the mine seem to be more important than the integrity of Sydney's primary health asset — drinking water.

"The mining underway in [one area] of Dendrobium mine is the most aggressive mining to have been approved in the special areas.

"And amongst the most aggressive anywhere in NSW."

Mr Turner said confirmation of seam-to-surface fracturing in what was supposed to be a protected part of the catchment was most worrying, and the side effects from bulging would only become worse.

"The valley bulging, which then causes deformation to the rock underneath and around the reservoirs, generates leakage pathways from the reservoir into the groundwater system, so it is meant to be causing water loss around Cordeaux," he said.

"It's not known whether that is yet happening at Avon.

"For Cordeaux it is uncertain how much water loss is occurring but it is certain with more mining, whatever loss is occurring is only going to get worse."

The Dendrobium underground coal mine (represented by the black dot) is seen in the metropolitan special area of Sydney's drinking water catchment. ( Supplied: Water NSW )

Premier must halt any extension: Lock the Gate

The report has prompted calls from environmental groups for a moratorium on any further mining in the area until stricter controls are introduced on existing mines.

Lock the Gate Alliance spokesperson Georgina Woods said it was unacceptable that management actions for the Dendrobium mine had failed to protect Sydney's drinking water.

Experts say major catchment damage has been caused and the Government is allowing miners to withhold data. ( ABC News: Billy Cooper )

"This report reveals that precious rainfall that should be feeding Sydney's dams and drinking water supply is being drawn into the polluting mining voids beneath the surface," she said.

Ms Woods also called for plans for further expansions at the mine and for two new longwalls to be halted.

Dendrobium mine is distinguished from other mines by its two-kilometre longwall mining which allows for extractions 400 metres below the surface at a width of 300 metres.

"The Premier must commit that the planned longwall coal panels will not proceed," she said.

"We need a moratorium on any further mining operations in the catchment and a full inquiry into the impacts of the Southern Coalfields on our water resources."

NSW Premier Gladys Berejiklian said she was "absolutely" concerned by the reports and the Government would investigate.

"We need to take a serious look at this because I don't want anything compromising now and into the future, any of our water security or any of our prime agricultural land," she said.

Department stood with BHP Billiton

In approving mining at Dendrobium in 2013, the department embraced BHP Billiton's rejection of a 2012 impact assessment that predicted seam-to-surface fracturing.

"[The department] did so without advising and consulting WaterNSW or advising OEH or the community," Mr Turner said.

The ABC has sought comment from the Department of Planning.

In 2015, the National Parks Association wrote a letter to the Department of Planning warning of fracturing.

In 2016, it advised in a report that the groundwater in reservoirs had been severely disrupted by mining.

The mine's owner, South32, provided a statement to the ABC and said the details within the report were being examined.

"We will continue to engage with government agencies and other key stakeholders to ensure continued compliance with consent conditions."

A WaterNSW spokesperson told the ABC the report "accurately represents the state of current understanding of this critical issue".

The report's key recommendations should be incorporated into an assessment of mining applications, the spokesperson said.