The Federal Court of Australia made the ruling in response to a class action suit brought by eight teenagers that argued the expansion of Whitehaven Coal Ltd's Vickery Project in New South Wales would contribute to climate change and endanger their future.
In his ruling, Justice Mordecai Bromberg said that the minister could foresee the possibility of future harm caused to the children in the case by the increase in carbon dioxide emissions from Whitehaven's expansion and therefore must recognize a so-called duty of care, or moral obligation, to the children, when approving it.
Ava Princi, 17, one of the students that brought the suit, said she was "thrilled" by the judgment because it was the first of its kind.
However, the court stopped short of issuing an injunction to prevent the minister from approving the expansion.
Whitehaven welcomed the decision not to issue the injunction and said it would work towards getting the federal environment protection approval for the expansion, sending its shares 3% higher to a more than one-month high.