The pilot of PAL210 was issued with a runway 07 Mudgee 1, standard instrument departure (SID). This was subsequently amended to a runway 34 Radar 3 Mudgee Departure SID after the pilot required that for take-off. On departure, PAL210 was instructed to maintain runway heading but was observed to commence a left turn onto a heading of about 300 degrees shortly after becoming airborne. The Aerodrome Controller (ADC) advised the Departures North controller as soon as the turn was observed. Conflicting traffic was a helicopter, VH-AGL at 1000, feet holding at about one mile north of Canterbury in anticipation of crossing the runway 34 departure path behind PAL210. The pilot of VH-AGL had the DC10 in sight from the time it began the takeoff roll. The Departures North controller instructed PAL210 to turn right heading 350 as soon as the advice from the ADC was received, and requested altitude. This was reported as 2000 feet. Because PAL210 had reached 2000 feet prior to infringing the 3 nautical mile separation standard between aircraft, a breakdown in separation did not occur.