Applicant H J Banks & Co had applied for full planning consent for an 18.5-hectare extension to the existing Bradley surface coal mine to the north east of Consett.
According to a planning report, the works would allow for the extraction of up to 90,000 tonnes of coal and 20,000 tonnes of fireclay.
Following the works, the site would be restored "to include woodland, species-rich grassland and hay meadow, scrub, water features and agriculture", the report said.
The report advised that officers considered the effects of the proposals on the character of the site and its immediate context would be highly adverse during the operational period of around 14 months.
However it added that, "on completion the effect would reduce to medium-high adverse in the north [of the site], reflecting the loss of mature trees, and low in the south, reflecting the similarity of the newly restored site with its present open character. The effect would become progressively neutral, then beneficial, as the restored landscape features matured".
The report said that there would be "some localised impacts on the visual amenity of local communities over the life of the site, but from most residential areas, views would be screened".
Planners concluded that there "may be some disruption to residential amenity of those living close to the site, but this would be temporary and controlled through suitably worded [planning] conditions".
The report recommended that the plans be approved.
However, councillors voted against the proposals.
A decision letter said that reasons for the refusal included that the proposed development "would not be environmentally acceptable with respect to landscape and visual impacts and residential amenity impacts, and could not be made so by planning conditions or obligations".
It also said that the proposed development would be contrary to the National Planning Policy Framework "as the adverse impacts of granting planning permission would significantly and demonstrably outweigh the benefits, specifically in respect of adverse landscape and visual and residential amenity impacts".