Aquila started legal proceedings against its JV partner last year when Vale unexpectedly pulled out of arrangements to secure 4 million tonnes per annum of port and associated rail capacity to export through Abbot Point in 2013.

Emerging from a trading halt since Thursday, Aquila has released the key findings of a comprehensive study undertaken by the JV manager of the project that largely confirmed its technical and financial viability.

However, the manager noted that a feasibility study could not be completed to adequate standards due to the absence of a definite logistics solution or firm off-take agreements.

Targeting an average of 4.5Mtpa of hard coking coal production in a single longwall operation over a mine life of 48 years, two possible schedules were presented.

Both were based on exporting through the stage 2 capacity of the proposed Wiggins Island export coal terminal but took different approaches to development and production.

Aquila said Schedule A offered an earlier startup date for the project but relied on stockpiling the development coal for too long on the surface, which would cause product deterioration.

The company favoured Schedule B and provided project timelines, financial estimates and other insights based on this path.

If this schedule is pursued, construction of the project is expected to take 28 months with $1.25 billion of capital expenditure, including $85 million as a contingency.

Surface infrastructure is expected be complete by June 2014.

By October 2015 the coal handling and preparation plant is expected to be complete, along with the drifts to allow first access to the underground coal.

Aquila said practical completion of the project would be achieved by December 2015 and the longwall could start production in October 2016.

The CHPP would be designed with a throughput capacity of 1200 tonnes per hour, while free-on-board operating costs excluding royalties were estimated to average at $94.47/t over the 48-year mine life.

This figure assures the mine would be profitable, as the coal quality was considered to be low volatile, standard-grade hard coking coal.

“The proposed Eagle Downs coal mine’s brand should be well received in global metallurgical coal markets,” Aquila said.

The stage 2 capacity of Wiggins Island was favoured by the joint manager of the project as it offered the first available port capacity in Queensland.

But the applications have also been made for expanded capacity at Abbot Point and the Dudgeon Point expansion at the Dalrymple Bay Coal Terminal.

The Bowen Basin project hosts 254 million tonnes of proved and probable reserves and total resources of 959Mt.

Under the ongoing legal actions against 50% JV owner Vale, Aquila is seeking damages for the expected income from longwall mining at Eagle Downs from 2013.

Aquila shares are up 13c to $8.48 this morning.