The Argyll & Bute council planning committee approved Elixir’s plans which includes on-site housing, a visitor centre and a multi-purpose educational facility.
The new site will also have floor maltings capable of supplying more than 50% of the full one million LA capacity of the distillery.
“We’ve worked closely with the Argyll & Bute planning committee to create plans for a distillery that fits into the landscape and supports the community,” said Elixir Distillers co-founder Sukhinder Singh.
“We want to create whiskies that inspire both the people of Islay and Islay whisky fans world-wide, enhancing the already glowing reputation of Islay whiskies, while also becoming an integral part of the community.”
Elixir also intends to create an apprentice programme to train the next generation of distillers and the name of the distillery will be announced at a later date.
Oliver Chilton, head blender at Elixir Distillers, added: “We take great pride in being able to learn, as whisky enthusiasts and use that knowledge as a guide to find and bottle great whisky including our independent bottlings brands Port Askaig and Elements of Islay.
“Having our own distillery will be a fantastic opportunity to apply the same methodology and passion for flavour in a drive to make truly great spirit to enhance the incredible reputation that Islay single malt already has.”