The approval is subject to 137 conditions, which have been framed to protect land and groundwater in the region.
The key requirements include new rail load-out facility, installation of dust and noise monitoring and management systems, sealed road from Acland to Jondaryan, establishment of a flora and fauna conservation zone along Lagoon Creek and verification of the design and construction of the rail infrastructure to minimize potential flooding impacts.
The project will support the region with more than 250 jobs during construction phase and 435 jobs on commencing operations.
State Development, Infrastructure and Planning Deputy Premier and Minister Jeff Seeney said: "Today’s decision from the Coordinator General is a significant step towards construction of this mine and great economic news for the Darling Downs and south-east Queensland.
"The reduced scope of this project in response to local concerns is a good example of a resource company working hard to achieve community confidence."
The company’s expansion plan was not approved in 2007; however, later on, it reduced the project’s footprint by around 60% since 2012.
The Commonwealth Minister for the Environment will now evaluate the expansion project for approval following which the state government will issue a mining lease.
