Initially, this project will add eight million tonnes per year capacity (100% basis) in export of metallurgical coal, with an expectation of a rapid expansion to ten million tonnes per year.

BHP Billiton and Mitsubishi Corp will invest a total of $4.2bn in the initial project, of which BHP Billiton’s share is $2.1bn.

The resource life of the initial project will be more than 60 years and coal production is expected to begin in 2014.

BHP Billiton said that the new Caval Ridge Mine will have the capacity to produce 5.5 million tonnes per year and the Peak Downs Mine will expand production by 2.5 million tonnes per year.

The BHP Billiton Mitsubishi Alliance, a 50-50 joint venture between BHP Billiton and Mitsubishi, owns and operates seven mines in the Bowen Basin of Queensland.