The Supreme Court in Brisbane has overturned a Land Court decision that had recommended scrapping the expansion of the New Acland coal mine on Queensland's Darling Downs.
The case will now go back to the Land Court for consideration.
More than 60 landholders have been fighting the mine expansion, claiming it would ruin prime agricultural land.
The Land Court last year found in their favour, saying the risks to groundwater were too great.
But today, Justice Helen Bowskill ruled the Supreme Court rejected that decision and sent the matter back to the Land Court for further consideration of issues including social impacts, noise and groundwater.
Following Judge Bowskill’s findings today, Farmers for Climate Action Queensland coordinator Michael Kane issued a statement of solidarity with the farmers and families who have been fighting the expansion of the Acland Coal mine for over a decade.
“Farmers for Climate Action stand in solidarity with the Acland community," said Mr Kane.
"We are deeply concerned for the well being of the farmers and their families who have now fought the expansion of the New Hope coal mine for over a decade.
“We had hoped that today’s decision would put a final end to the division and pain the Acland coal mine has caused our community, however, we remain hopeful that the matter will soon be resolved and the local community will finally be free to get on with their lives and livelihoods without the prospect of a coal mine polluting or consuming their homes, land and resources.
“We call on the Government to issue no licenses or further approvals to the Acland coal mine, a mine that has already destroyed the township of Acland, polluted the township of Jondaryan and now threatens the future of farming in a region that contains some of the finest agricultural land in Queensland."
However the Liberal National Party welcomes the decision today by the Supreme Court.
“There are hundreds of jobs and communities depending on the continuation of New Hope’s operation, said a statement from LNP Leader, Deb Frecklington
“The Palaszczuk Government should have respected the current legal process and not refused the application to amend the environmental authority for the New Acland stage 3 project.
“The matter will now be reconsidered by the Land Court and as always the LNP will respect this process.”
The mine's owner, New Hope Corporation, has issued a statement, saying it welcomed the judgement.
"We remain committed to securing approval for this project and in doing so being able to provide ongoing employment for the circa 700 jobs reliant on the project," the statement said.