The Queensland Government in Australia has approved Pembroke Resources’ proposed A$1bn ($695m) Olive Downs metallurgical coal project, 40km south-east of Moranbah in the Bowen Basin.

Queensland’s independent Coordinator-General has granted the approval with conditions to ensure local employment and manage potential impacts on the environment.

Premier Annastacia Palaszczuk announced in Parliament: “The mine is expected to create 1,000 operational jobs and 500 jobs during construction.

“The project will contribute an estimated $8 billion to the local economy and more than $10 billion to the Queensland economy.”

Subject to approval by the Commonwealth Government, Pembroke Resources expects to start construction in 2020.

Olive Downs is expected to produce up to 15 million tonnes of metallurgical coal annually once it becomes operational.

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According to Minister for State Development, Manufacturing, Infrastructure and Planning Cameron Dick, metallurgical coal produced in the Bowen Basin is in high demand from steel manufacturers in Asia.

He said: “The project will produce up to 15 million tonnes of metallurgical coal per year for export via the Dalrymple Bay Coal Terminal near Mackay.”

Dick said that the project will maximise the use of existing road, rail, power and water infrastructure in Queensland’s coal region and operate alongside 25 existing mines.

The proposed project will include coal handling and crushing facilities at the Olive Downs South and Willunga precincts.

“The project will contribute an estimated $8 billion to the local economy and more than $10 billion to the Queensland economy.”

It will also include a rail link to transport coal to the Dalrymple Bay Coal Terminal and a water pipeline and power transmission line.

The project will be implemented according to the guidelines of the Strong and Sustainable Resource Communities Act (SSRC Act), under which Pembroke will be required to encourage workers to live in local towns such as Moranbah, Nebo, Dysart and Middlemount to reduce its reliance on fly-in, fly-outworkers.

Member for Mackay and Assistant Minister for State Development Julieanne Gilbert said that this was the first project to complete a social impact assessment under the SSRC Act as part of the environmental impact statement.

Queensland Resources Council chief executive Ian Macfarlane said: “The approval of projects like Olive Downs provides the opportunity for more jobs, more exports and more royalties for Queenslanders.”