Britain's coal industry is on track to break a new production record as it expands at a time when many environmentalists are calling for it to be cut back or closed down.

The West Midlands colliery of Daw Mill near Nuneaton is expected to produce more coal this year than any other in the history of an indigenous industry that began with the Romans.

And this week a rig will move into position to drill three exploratory boreholes that could lead to reopening of a mothballed mine at Harworth in north Nottinghamshire.

Daw Mill has already mined 3m tonnes this year and staff are confident of hitting 3.25m tonnes by the end of this month, beating a 13-year-old record for annual output set at Selby, North Yorkshire.

"This is a remarkable achievement and shows our mining skills are world class," said Jon Lloyd, chief executive of UK Coal, which runs Daw Mill and four other deep mines. The production rise comes at a time when at least 14 companies have applied to develop 58 new opencast mines in Britain, giving coal its biggest boost in 30 years. Much of the industry was closed down after the disastrous strike in 1984 and 1985.

There are now 680 miners working at Daw Mill and the company is looking at whether it can extend working there to exploit a further 40m tonnes of coal. A further 40m tonnes could be accessed at Harworth if UK Coal obtains positive results from the boreholes and a separate seismic survey. If Harworth re-starts, at an estimated cost of £200m, it would provide work for 400 skilled miners at the Welbeck colliery near Mansfield which is due to close at the end of next year.

UK Coal is spending £100m on extending output at Thoresby in Nottinghamshire and Kellingley in West Yorkshire.

The bulk of the Daw Mill output goes by rail to the Ratcliffe power station near Nottingham which is run by the German-owned utility E.ON, with some of the rest used by the Cottam facility operated by EDF of France. E.ON is among the energy producers that want to build new coal-fired power stations, including the controversial Kingsnorth scheme in Kent.

The government is trying to decide whether it will allow new stations with or without pilot schemes for carbon capture and storage (CCS), a technique which buries carbon dioxide to reduce emissions from coal plants. The European Union has been gradually introducing tougher environmental restrictions on the burning of coal at power stations, and environmentalists consider CCS vital.

The expansion of coal mining in Britain follows a reassessment of its economics triggered by a tripling of commodity prices over the past two years. When Harworth closed in August 2006, the price of world coal was £34 a tonne. That rose to £100 although it has since fallen back to half of this level. About 60% of coal burned at UK power stations is imported from countries such as Russia, South Africa and Colombia.

Greenpeace opposes the development of mining and is sceptical about "clean coal" projects using CCS. "Coal is the most carbon-intensive of all fossil fuels," it argues. "Being nearly pure carbon, it releases nearly pure carbon dioxide. In the sector that changes our climate the most, coal is the worst offender."