The Australian government says it has reached a 39.3 million Australian dollar ($29.6 million) settlement with the owners of a Chinese coal carrier to pay for environmental damage caused when the ship ran aground on the Great Barrier Reef six year ago.

The government had sued Shenzhen Energy Transport for at least AU$120 million in the Australian Federal Court after the fully laden ship Shen Neng 1 went off course and grounded on Douglas Shoal, 100 kilometers (60 miles) east of the town of Rockhampton, among the World Heritage-listed coral reefs in April 2010.

The settlement bears significant importance as mining is by far the largest industrial sector in Australia, and the country produces some 70 percent of its electricity from coal. Australia is the world's second largest coal exporter, and most of exported amount ends up in China, which has experienced an economic boom over the last decade with an extensive use of coal to keep its economy running.

Environment Minister Josh Frydenberg said in a statement on Monday that Shenzhen Energy Transport had agreed to the out-of-court-settlement after refusing to accept responsibility for restitution for more than six years.

The Federal Court heard that the crash site was contaminated with hundreds of kilograms (pounds) of paint particles tainted with the highly-toxic, anti-fouling agent tributyltin.

Tributyltin slows the growth of aquatic organisms on ship hulls, and marine biologists say the particles need to be removed from the 40-hectare (100-acre) crash site to allow the area to recover.

The carrier's owner said the reef is self-healing and the company should not have to pay for a clean-up that was not needed.

It also disputed the testing methods that led to the detection of tributyltin in the area.

Shenzhen Energy Transport's maritime insurer, London P&I Club, said in a statement the Australian government's estimated costs of fixing the reef were unrealistic.