Centennial Coal is cutting 120 jobs across its New South Wales operations.
Blaming the “ongoing economic downturn” for the cuts, Centennial said high production costs, weaker commodity prices and a stubbornly high Australian dollar is impacting the company’s competitiveness.
“Centennial has no option other than to reduce employee and contractor numbers further,” the company stated.
“Unfortunately, as there are few signs of an immediate improvement and following the conclusion of a business review of all operations, further cost reductions will have to be made in order for Centennial to sustain its business and be competitive under current market conditions.”
The company said it will attempt to keep redundancies to a minimum but expects 120 employees and contractors will be affected.
Warning more cost cuts are in the pipeline, Centennial said it will be looking to cut supplier costs and secure production efficiencies.
A spokesperson for the company said roughly two thirds of the redundancies will be made from Centennial's western Operations which includes Lithgow and Mudgee.
He added about one third of the cuts will be from its Lake Macquarie site.
The company said retrenchments will begin this week, with the majority taking place today.
In the last year Centennial has placed its Mannering and Airly mines into care maintenance mode.
“Both mines have struggled to make a positive contribution in their own right not only through the lower coal price but a combination of difficult mining conditions, poor coal quality and, in the case of Airly, transport costs have hindered the viability of these mines,” Centennial chief operating officer Steve Bracken said at the time.