Mining group Xtrata brushed off claims that it is bluffing when it said it will suspend its multi-billion dollar project in the Surat Basin in central Queensland due to the Federal Government's proposed resources super profits tax.

The company released a statement earlier this month that it will shelve its $186 million development project – the Wandoan thermal coal project.

A spokesperson of Xtrata said the company will continue to pursue its land purchase within the area since it was already settled before the tax reform came out.

James Rickards, Xtrata coal representative, said the company has refuted statements that it was trying to bluff the Federal Government or the community on the suspensions on its projects. He added Xtrata will not pursue the project if the super profit tax will be implemented without any revisions.

"We made a commitment to honour the land owner agreements and offers that have been made to members of the Wandoan community at last week's town meeting and we're going to ensure that those agreements offers are met,” he sad.

"This is about ensuring that we're not letting down the community as we put this project on hold while the RSPT continues to be debated.”

On the other hand, the suspension of the Surat Basin Rail Project follows after Xtrata made its decision to suspend work on its major coal mine. The project developer said the timing of the RSPT is unfortunate.

Everald Compton, rail project spokesperson, said the economic crisis has been hit hard in Europe and the implementation of tax is a slap on people's confidence in the economy.

He is disappointed with the Government's lack of support in the mining industry and added that small businesses will be affected by the tax.