The recently completed feasibility study into the project – which is held in joint venture with Mitsui Coal Holdings – recommended a stand-alone operation with ROM coal treated in an onsite preparation plant.

But the recommendation was rejected by Eastern this week, because of the significant increase in operating and capital expenditure costs since the company first acquired the coal exploration interests in 2004.

“In the opinion of the joint venture, the projected development and operating costs and revenues for the mining options which were considered do not justify commencing development of the resource at this time,” Eastern said in a statement.

“The joint venture will continue to review other development options for the Broughton project, including development in conjunction with adjoining tenement holders to maximise economics based on an expanded operation.”

The feasibility study also confirmed the 30 million tonne resource (measured 16.5Mt, indicated 8.5Mt and inferred 5Mt) to a cut-off depth of 200m with a dual hard coking coal and PCI (pulverised coal injection) product.

Mitsui will maintain its current interest in the project and retain the right to increase its interest by an additional 20% once the full elements of Stage 2 of the feasibility study, including a definitive plan to mine the deposit, have been completed.