Just two months after it was shelved by a federal court challenge, Australia’s largest coal project has been revived by the federal government.

Adani’s $16.5 billion Carmichael Mine and rail development in the Galilee basin of central Queensland was approved it for a second time, subject to “rigorous conditions” that would protect threatened species. The Guardian reported that its federal approval was set aside in August after it emerged that Greg Hunt, the environment minister, had not considered its impact upon two vulnerable species, the yakka skink and the ornamental snake.

Environmentalists have said the mine will endanger the Great Barrier Reef by increasing the amount of shipping through the ecosystem. The emissions from the burnt coal will also threaten the reef by accelerating ocean acidification and rising water temperature, which can lead to coral die-offs.

Hunt considered information from the Mackay Conservation Group, the Environmental Defenders Office and Australian Conservation Foundation before making the decision.

The Mackay Conservation Group initiated the federal court case that saw the approval overturned and has argued the mine would severely impact groundwater supplies and exacerbate climate change. The court case prompted the federal government to propose new laws aimed at curbing perceived “lawfare” by “vigilante” green groups.

Among the 36 conditions placed on Adani is a commitment to “protect and improve” 31,000 ha of habitat used by the southern black-throated finch. The site of the mine is one of the threatened finch’s last remaining holdouts.

This protection will be in the form of an offset, where habitat is found elsewhere and secured. A further 135 ha and 5,600 ha will be offset for the ornamental snake and yakka skink, respectively. Adani will have to pay $1 million over 10 years toward threatened species in the Galilee basin.

Adani will also be required to implement all advice from the independent expert scientific committee on coal seam gas and large coalmining development and return 730 megalitres of water each year for five years to the Great Artesian basin to replace water used during mining.

The Carmichael Mine, originally going to start production in 2017, is set to become the largest in Australia, extracting a maximum of 60 Mt/a (66 million stpy) of a coal for export via a new rail line to an expanded Abbot Point port, near the town of Bowen.

Adani has welcomed the decision and said its mining project will bring “much needed economic benefits” to Queensland while protecting threatened species.

“Today’s announcement of the final federal approval for the Carmichael mine and north Galilee basin rail by Minister Hunt makes clear that these concerns have been addressed, reflected in rigorous and painstaking conditions,” a company statement read.