A debate in State Parliament produced no gain for environmental groups fighting to stop longwall coal mining under Woronora Dam.
Government and opposition MPs simply "noted" a petition signed by 10,700 people, who are concerned about water loss and contamination.
The mines received conditional approval in 2009 when Labor was in office and final approval was given earlier this year under the present government.
Heathcote MP Lee Evans was the only Sutherland Shire MP to take part in the June 4 debate and Attorney-General Mark Speakman (Cronulla) and Parliamentary Secretary for Transport Eleni Petinos (Miranda) did not deny later claims they were not even in the chamber.
Mr Evans said it "was no mean feat to get 10,600 signatures on a paper petition" and thanked those who had signed it.
However, he said he was "confident that the restrictions around water for this mine will preserve water quality".
"The conditions put forward by all the experts are strict indeed," he said.
Sutherland Shire Environment Centre (SSEC) said in a statement the debate failed to apply proper scrutiny to this matter.
The group rejected government assurances that damage to the water system from existing mining was insignificant.
"To all the people who took the time to gather petition signatures, to send us the completed petitions, to speak to other people about the issue, call and email the politicians - we thank you, and are so very sorry that you have been ignored," the statement said.
"It would be understandable if you are now feeling cynical about our democratic parliamentary process.
"The positive aspect of our efforts - on your part and ours - is that so many more people now realise what is taking place at Woronora Reservoir.
"The alternative to voicing our concerns is to say nothing, and allow the mining to proceed with no opposition whatsoever.
"The debate did not achieve the outcome we were hoping for, but community opposition to the mine is clear, and this opposition crosses all sides of the political spectrum, despite the failure of both major parties to take any effective political action."
SSEC said the Nature Conservation Council was understood to be considering legal action.
"At the moment, that seems the best avenue, and we will keep to you posted as this progresses," the group said.
"We are also considering organising a larger rally once social distancing restrictions are lifted."
Mr Speakman told the the Leader he had "given close consideration to this important issue", meeting with SSEC, noting the results of previous expert inquiries and reviewing the final report in October 2019 of the Independent Expert Panel for Mining in the Catchment.
"I've also sought and received my own individual briefing from the department,' he said.
"If I thought the recent approvals impacted our drinking water (quality or quantity), I'd oppose them," he said.
"For these particular approvals, however, and after a rigorous planning process, there appears to be no impact on drinking water quality from a mine 500 metres underground and any loss of water is tiny.
"On the other hand, mine closure would throw hundreds of employees out of work (even more if it affected the viability of the BlueScope steelworks).
"I therefore believe the balance is in favour of proceeding with these recent approvals, as did the Labor opposition this month."
Ms Petinos said she appreciated the SSEC'S position.
"However, very few constituents contacted me regarding the mining approvals beneath the Woronora Reservoir," she said.
"Both the coalition government and Labor opposition were in agreement in the debate conducted in State Parliament on 4 June regarding the continuation of mining and proceeding with the recent approvals.
"The facts remain that none of the independent inquiries have recommended that mining in the catchment be prohibited, or found that mining is resulting in any significant impacts on the quantity or quality of the water."
SSEC chair Dr Tassia Kolesnikow said Sydney was the only city in the world that allowed longwall mining in a publicly owned water catchment.
"Longwall mining is a particularly destructive form of mining, which can result in fracturing from the mine to the surface, surface cracking and the loss and contamination of water flowing into the drinking water supply," she said.