Completion of the sale follows the transfer of the coal lease and associated licences, and includes the mine, associated land holdings and the responsibility for rehabilitation and closure of the mine once operations are complete.

Mining operations at Elouera by BHP were completed in 2005. Since then the mine has been operated under a limited contract mining agreement with Delta Mining Company, which was finalised in March 2007.

Gujarat paid $A49 million for the coking coal mine, which abuts the company's Avondale lease.

Gujurat will rename the mine NRE Wongawilli Colliery in recognition of its history.

Gujurat will begin mining in February 2008, with development works commencing on the first of three longwall blocks.

Gujarat previously said initial production at Elouera is expected to be about 4000 tonnes per week of hard coking coal.

Acquisition of Elouera has the added bonus of giving Gujarat underground driveage access to its Avondale Colliery, avoiding the need to establish new infrastructure as was originally planned for Avondale.

Gujurat plan to develop new haeadings towards the south and west to access of NRE Avondale.

The acquisition also means the company can take advantage of Elouera's surface infrastructure.