The Isaac Plains wash plant hit a yield of 74.5% to produce 2.12Mt of product coal, while carryover tonnes from the previous financial year lifted 2009-2010’s total saleable production to 2.48Mt – a new sales record.

About 47.6% of the saleable production was thermal coal, 26.8% was semi hard coking coal and 25.6% was pulverised coal injection coal.

The open cut mine has received all government approvals to expand to 4 million tonnes per annum of run-of-mine production, and G&S Engineering is due to finish commissioning the Bucyrus Erie 1370W dragline in May.

The Aquila and Vale joint venture has stitched up agreements to export the expected 2.8Mtpa of the expanded saleable production from the mine through the Dalrymple Bay Coal Terminal. It will be railed through a combination of Queensland Rail National and Pacific National.

But both companies remain in a legal dispute over the port and rail logistics of the Eagle Downs hard coking coal project.

The longwall project was on track to start production of 4.6Mtpa of raw coal production in 2013, but Vale unexpectedly pulled out of the arrangements to secure port capacity at Abbot Point in January.

The project might not secure port capacity until mid-2016.

Aquila is seeking damages from Vale for the expected income from longwall mining at Eagle Downs from 2013.

Aquila started the legal proceedings in the Supreme Court of Queensland in March and is also seeking a declaration that Vale has committed a default under the joint venture agreement for the project.

The definitive feasibility study is scheduled to be completed in June 2011, but in its financial year report Aquila said this was subject to rail and port capacity being available.

Various industry sources have indicated to ILN that Vale is seeking to purchase port capacity for Eagle Downs from a private coal company in the state.

ILN is seeking confirmation from the Brazilian mining giant.

Aquila and Vale are also at odds over the Belvedere project.

While Aquila is a 50:50 JV partner with Vale for Isaac Plains and Eagle Downs, this disagreement concerns the value of Aquila’s 24.5% stake of the Belvedere longwall project which is up for sale.

Vale would like to pay less than $A100 million for Aquila’s stake in the project, and announced the purchase of private company AMCI’s 24.5% stake for $US92 million in June.

But Aquila believes the stake is worth a lot more, given the value of some recent coal asset sales.

Aquila said the Fair Market Value determination process for the stake is ongoing in accordance with the conditions of the Belvedere JV agreement.

Aquila, which is also an iron ore and manganese explorer, ended the 2009-2010 financial year with a net loss of $A32 million.

Coal sales revenue reached $129.84 million, up 41% from the previous financial year.

The company ended June with cash assets of $281 million.

Aquila shares closed down 6c to $8.86 yesterday.