Thiess will be responsible for the construction of the coal handling plant and associated mine infrastructure as well as the subsequent 20-year operation of the Chitarpur Coal Project, which is expected to eventually have a production capacity of 6.75 million tonnes a year.

Thiess Asia chief executive Bruce Munro said 115Mt of coal would be mined over the next 20 years, which would be used to supply steel plants and an 1100MW mine-mouth power station currently under construction adjacent to the mine.

Located northwest of Calcutta and about 90km from the state capital of Ranchi, the project is Thiess’ first major mining project in India.

Abhijeet Group chairman Manoj Jayaswal said after inspecting a number of Thiess coal mining operations in Australia and Indonesia his company had chosen Thiess because of its “world-class capability and mining experience in complex opencut pits”

Parent company Leighton’s shares were up $1.26 this morning to $44.19. Early last month the company experienced its biggest three-day loss since May 2004, when shares fell $8.40 to $38.30.

Analysts believed shares were being pushed down on the general negative views of growth prospects and the market generally.

Leighton shares opened the new year at $60.76 before closing up at $62.40 on its first day of trade.