The company expects to divest a majority stake in the mine to boost mining capacity, strengthen the rail line and build a port jetty.
Lanco acquired Griffin Coal mines, located in the Collie Basin, Western Australia through its subsidiary Lanco Resources Australia in March 2011 for A$730m.
The company now plans to enhance production from 4 million tonnes to 18 million tonnes annually within three years
Lanco chairman Madhusudhan Rao was quoted by Business Standard as saying that a total investment of $1.2bn is required for the mine’s expansion.
"For Griffin coal expansion, we have plans to achieve financial closure by July 2013. We are looking at some sort of a strategic partner also to join."
Griffin procuded 3 million tonne of coal in 2011 and is estimated to produce about 3.7 million tonne in 2012.
