The pilot project will involve the first-ever conversion of UCG gas into a clean diesel fuel.

Linc chief executive Peter Bond said the plant was on track for early commissioning with no major delays experienced to date.

"The GTL pilot plant is tracking very well with the bulk of the plant erected," he said.

"We feel confident that Linc will commence early commissioning of the plant by February 28."

In related news, Linc said it has JORC coded 401 million tonnes of coal, based on the results from 106 drill holes completed over the past year.

Linc needed at least 300 million tonnes to justify the construction of its UCG-GTL plant.

"Not only does 401 million tonnes of coal give Linc over 60 years of Syngas feedstock at a production level of 20,000 barrels per day - but 401 million tonnes potentially offers 600 million barrels of liquids (diesel and jet fuel) production from the Chinchilla site," Bond said.

Linc has also started the 2008 exploration program, with three drill rigs operating at the Chinchilla site aiming to further expand the coal deposit.