Significantly, “the main benefits are likely to be private benefits for large farming operations which broadscale-clear under the code," the document said.

A spokeswoman for Ms Upton said: "The code was prepared in response to the review by the Independent Biodiversity Legislation Review Panel."

"The matter is now before the Land and Environment Court and it is not appropriate to comment further at this stage," she said, referring to a legal challenge launched last November by the Environmental Defenders Office NSW.

"This document shows the minister was told its land-clearing laws would cause a massive spike in habitat destruction, but it kept this fact secret and approved the laws anyway," Kate Smolski, chief executive of the conservation council, said.

"Combined with the water scandals, this adds to the impression the Berejiklian government does favours for a few big agribusinesses at the expense of wildlife, bushland and the wider community."

Phil Spark, an independent ecologist based in Armidale, said he had reported more than a dozen cases of possible illegal land clearing to the OEH since the laws changed in August.

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Much of the problem for habitat loss may come from the lifting of restrictions on land that had regrown after widespread clearing in the decades up to the 1970s. Such land is now deemed to have been in "continuous use".

"It's really scary - the potential for clearing is enormous," Mr Spark said. "It's as bad as we expected."

For the government to consider revegetated land as "insignificant from the point of view of conservation is quite unfounded", he said.

The OEH advice said the department "anticipates most farmers will use these provisions minimally, a few might exploit them inappropriately, or invoke them after the fact for clearing which exceeds the government's intention".

"If unchecked, such clearing could destroy habitats, cause soil and water impacts, and/or undermine the integrity of the regulatory system among those who are staying within the intended limits."

Carbon emissions could also be increased from land clearing, the document said.

Labor's environment spokeswoman Penny Sharpe said the documents prove the land-clearing laws "were designed to allow dangerous land clearing across NSW, not stop biodiversity loss".

“The destruction of critical habitat for threatened species, risk to soils and water quality should have meant that the Environment Minister refused to sign off on the clearing codes, instead this minister abrogated her responsibility and waived them through,” she said.

Mehreen Faruqi, the Greens environment spokeswoman, said the advice made it very clear "even the small amount of environmental protections allowed for in the land-clearing laws will be almost impossible to enforce".

“It seems, from the memo, that OEH had been told to support the reforms despite the overwhelming evidence against them and they were really just clutching at straws to justify that support," Dr Faruqi said, adding it seemed the minister's role was to "just rubber-stamp whatever the dinosaurs in the Nationals want".