Environmentalists say the nation's unprecedented resources boom, which will see some US$500 billion pumped into gas, oil and mining projects in coming years, has come at the cost of the environment.
The United Nations has warned the Great Barrier Reef is at risk, while some scientists say it may already be too late to save it due to surging levels of shipping, offshore gas and oil exploration and port expansion.
By 2020 an estimated 7,000 ships will traverse the reef every year, up from 5,000 in 2010, of which one-fifth were coal freighters from Newcastle -- the world's biggest coal export hub in New South Wales state.
The nearby Hunter Valley has seen a six-fold increase in the number of open-cut mines in the past 30 years and locals say they are already feeling the impact as their health declines.
Asthma and respiratory illness have increased as explosive charges blast open new coal seams, and trains -- uncovered and streaming dust -- cross the pitted landscape 24 hours a day. Roads are grid locked.
Huge mine pits have slowly edged out what was once a thriving dairy industry and the community fears that farming could be wiped out altogether if plans to triple Newcastle port's coal output are allowed to go ahead.
"It's a big expansion," said local environmental campaigner Simon Fane, adding that the mining rush was impacting farmland, food production and thoroughbred horse breeding.
"It's globally significant what's happening in Newcastle in terms of the coal."
The port estimates that it will export some 139 million tonnes of the key energy and steelmaking fuel this financial year (July 2012-June 2013) and has unveiled plans to expand output to 330 million tonnes with a fourth terminal.
Environmentalists and sustainability experts have questioned the scale of the development, saying it is at odds with government policies aimed at reducing greenhouse gas emissions in line with international efforts.
Australia, among the world's worst per capita polluters, has pledged to reduce its emissions by at least five percent of 2000 levels by 2020 and recently introduced a corporate pollution tax as part of that push.
But the tripling of Newcastle coal output alone will see coal exported and burned equivalent to 1.5 times Australia's annual emissions, and there are similar port expansions planned all along Australia's booming northeast coast.
Mark Diesendorf, an ex-government scientist now based at the University of New South Wales (UNSW), has warned that the mining-rich nation faces the loss of natural heritage such as the Great Barrier Reef if the rampant development continues.
"We are greatly expanding coal mining, coal exports, coal seam gas production and other industries which are likely to have very huge impacts, not only on our environment but ultimately on our whole economic future," said Diesendorf, deputy director of the UNSW Institute for Environmental Studies.
"It's really a clash between long-term goals, which are sort of treated as political aspirations rather than real programmes, and what (the government) see as short-term necessities."
UNESCO recently delivered a stark report on the Barrier Reef, warning it faced a downgrading of its World Heritage status due to an "unprecedented" local development boom.
Offshore gas and oil exploration, port expansions and increased ship traffic were some of the major threats outlined by UNESCO, along with run-off and climate change, which was warming the ocean and making it more acidic.
Ports on the Barrier Reef coast currently export 156 million tonnes of coal per annum (mtpa) and there are plans to expand that to 953 mtpa within the next decade.
UNESCO called for a ban on any new port works near the reef until 2015, saying the scale and pace of proposals "appear beyond the capacity for independent, quality and transparent decision making".
There was an immediate backlash from the Queensland state government, which declared itself to be "in the coal business" and said it would not put the environment before economic development.
Australia's Environment Minister Tony Burke condemned the remarks and said the government was "committed to ensuring the best possible protection and management" of the reef, which as the world's largest coral reef system is a major tourist attraction.
But Burke also warned that he could not "take away the rights at law that applicants have" where approval bids for major mining and port projects were already underway, and said the largest would not come under the UNESCO ban.
"My view is you want (the coal) industry to be able to continue in a way that is sustainable," the minister said last month.
"That means putting the right conditions around, that means making sure that it's sensitive to the environment."
In Diesendorf's view the time has passed for strict conditions on development, and even a total crackdown may be too late.
"I can't see us saving the Barrier Reef to be honest," he said.
"If we really pulled out all stops, not just in Australia but around the world, we probably could save it. But it will likely come too late to stop some very serious impacts."