In an effort to produce an arrangement which “improves coexistence with local farms and homesteads”, the explorer decided to reduce the size and extent of the lease and revise the layout and design of the proposed mine.

The decision to downsize the mine follows consultations with community members, the Central Highlands Regional Council and the state government and is expected to produce a new lease application in coming weeks.

Bandanna reports that as the project timeline is governed by the slower environmental approval process, drafting of the lease application will not delay the mine’s development.

Springsure Creek is located 40km south of Emerald in Queensland’s Bowen Basin and is expected to begin longwall operations by mid-2014 producing 11 million tonnes of coal per annum.

Despite the controversial nature of the mine application, Bandanna managing director Michael Gray has embraced community involvement in the redesign of Springsure Creek.

“Bandanna is looking forward to continued engagement with the local community in relation to the project and we are strongly committed to demonstrating the coexistence of farming and underground mining as well as meeting the standards expected by the new Queensland government,” he said.

Queensland’s Courier Mail called the rejected mine lease a “victory for farmers”

“The original application was incomplete and should never have been approved by DERM (Department of Environment and Resource Management),” the newspaper quoted local farmer Kate Sullivan as saying.

"I'm glad some common sense has prevailed."

Springsure Creek already obtained 4Mtpa of port capacity at the Wiggins Island coal export terminal.

In addition, Bandanna said it had fully contracted a port-rail supply chain for exports starting in mid-2014.

The Brisbane-based explorer now has a total of 1650Mt of JORC-compliant resources and 306.6Mt of marketable reserves in its project portfolio.