Aquila, which has several coal projects in Queensland, on Wednesday received commonwealth approval for its $6 billion West Pilbara iron ore project and associated infrastructure in Western Australia.
That puts Aquila on track to become one of the few miners, other than BHP Billiton and Rio Tinto, that produces both coal and iron ore in Australia.
The proposal for the project, which is 50 per cent held by Aquila, involves the construction of a rail link from the proposed mine to a new iron ore export port at Anketell Point.
The project is a joint venture with American Metals and Coal International Inc.
Aquila shares closed up 22 cents, or 3.51 per cent, at $6.48 after an intraday high of $6.59.
Aquila said in a statement that the conditions imposed by the federal government were manageable and acceptable, while environmental offsets requested had been agreed upon.
WA's Department of Environment and Conservation has not yet announced its position on the mine and rail plan.
Both federal and state environment departments were expected to grant final approvals for the port proposal in the second quarter of calendar 2012, Aquila said.
Iron ore miner Fortescue Metals Group has an alternative proposal for the port but the fellow Perth-based company and Aquila said recently they were open to developing it in a broadened joint venture.
Aquila also on Wednesday announced it would issue bonus shares to its investors to recognise progress that had been made with its coal, iron ore and manganese projects over the past 12 months.
The company said the free entitlement of one for every ten existing shares held was intended to encourage greater liquidity in the trading of Aquila shares, which should increase its chances of being included in the S&P/ASX 100 Index.
Aquila currently has 374.3 million shares on issue.
Aquila also said it had completed a definitive feasibility study for its Gravenhage manganese project in South Africa.
The plan is for a 1.5 million tonnes per annum open cut operation, with an eventual underground mining component over 17 years, with exports slated to start in 2015.