Located halfway between the towns of Coppabella and Moranbah, the project is targeting up to 5.5 million tonnes per annum run of mine for 4.7Mtpa of export coking and thermal coal over a 20 year mine life.

Access development of the mine is expected to follow on from an initial box cut, while a coal handling and processing plant is expected to be built and operational in 2012.

But Vale plans to process the Ellensfield ROM coal using the CHPP at the nearby Carborough Downs mine beforehand.

"We believe we can add significant value to Vale's Ellensfield project, through our leading knowledge and experience in both above ground and underground infrastructure across a number of commodities,” SKM Queensland mining and metals manager Phil Tighe said.

The Ellensfield project is yet to gain Queensland government environmental approval, and Vale is currently preparing responses to public submissions made to its environmental impact statement.

After 2012, Vale plans to haul the Ellensfield product coal through the Goonyella to Abbot Point rail link (slated for completion in mid-2012) to either the Dalrymple Bay Coal Terminal or the Abbot Point Coal Terminal.