MCC said it had approved the $200 million transaction and also gained approval to undertake engineering, procurement and construction work on China First, according to Dow Jones Newswires.

MCC will also receive a 4% commission on the thermal coal sold from 30 million tonnes per annum of the potential 40Mtpa operation, according to the report.

The major Chinese miner aims to back 70% of the finance for the project with the help of Chinese banks and previously agreed to take 10% of its equity.

China First is looking at a 25-year mine life with Palmer aiming for construction to start in 2010 and mining in 2013.

The China First project will consist of a thermal coal mine near Alpha, west of Emerald in central Queensland, and a 490km standard gauge, heavy haul railway line linking the proposed minesite to a 4Mtpa, two-berth coal export terminal at Abbot Point near Bowen.

The project’s tenements hold more than 4.3 billion tonnes of inferred resources.

Resourcehouse also owns interests in magnetite iron ore deposits in Western Australia and South Australia, and oil and gas interests in WA and Papua New Guinea.

Hancock Prospecting, led by Australia’s richest woman Gina Rinehart, also has $15 billion worth of coal projects in the unexploited Galilee Basin, including a 500km rail corridor project to connect to Abbot Point for export.