The highly controversial $6.4-billion coal mine project between India's GVK Power & Infrastructure, and Hancock Coal owned by Gina Rinehart, the world's richest woman, in Queensland state has been given environmental approval by the federal government of Australia.

Subject to 60 conditions, Federal Environment Minister Tony Burke said on Wednesday the second stage of the Alpha coal mine project was approved after a rigorous assessment process to ensure it will not harm the Great Barrier Reef World Heritage Area and its surrounding marine area.

"The proponent must work with the Queensland government to identify opportunities to protect and conserve seagrass, the vital asset that protects threatened species including dolphins, marine turtles and dugongs," Mr Burke said.

"A heritage management plan will also need to be developed to maximise the ongoing protection and long-term conservation of the outstanding universal value of the Great Barrier Reef World Heritage property."

The approval effectively allows Hancock and GVK to expand the existing Port of Abbot Point to accommodate its A$10 billion Alpha coal project. The project obtained approval in August.

At present, the only thing lacking for the project to fully go is the release of a mining lease from the state government.

"We are the only coal developer in Australia to possess environmental approvals at a state and federal level that integrate the mine, rail and port . . . that will significantly assist in the facilitation of opening up the Galilee Basin," GVK Vice Chairman Sanjay Reddy said in a statement.

The Alpha Coal Project involves a thermal coal mine in the Galilee basin, a 495km rail line and port facilities at Abbot Point.

With an expected mine life of more than 30 years, the project is seen to churn out 32 million tonnes of coal a year. First output has been scheduled for early 2016.

At least 650 jobs are expected to be available during construction of the port expansion, with 200 permanent jobs in the Whitsunday area.