The O'Farrell government has bowed to pressure from western Sydney residents and cancelled a plan to truck soil from a contaminated site in Hunters Hill to Kemps Creek near Penrith.
Remediation of the site at Hunters Hill, which had been the subject of a parliamentary inquiry in 2008, will now be put on hold, said Finance Minister Andrew Constance.
The NSW government will instead seek to move the waste to the Northern Territory, where the federal government is considering establishing a national radioactive waste facility, he said.
There is no timeframe for the move.
The O'Farrell government announced in December 2012 it would split the waste to be removed from an old uranium smelter on Nelson Parade in Hunters Hill, sending radioactive waste to a secure storage facility in Lidcombe and "restricted solid waste" to Kemps Creek.
There is a long history of opposition to the move. Liberal MP for Mulgoa Tanya Davies, who holds the seat with a 12 per cent margin, welcomed the decision not to send waste to Kemps Creek.
“The remediation of the site at Hunters Hill will be deferred until the Commonwealth has made a decision on whether to allow us to dispose of this material at its national repository,” Mr Constance said.