PERTH (miningweekly.com) – Diversified miner Glencore on Wednesday confirmed that it would postpone the development of the Blakefield North underground mine, in New South Wales.

The project, which forms part of the larger Bulga coal complex, had been due to start longwall production in 2017, and would have extended the life of the existing underground operations at the Bulga complex.

However, a spokesperson for Glencore told Mining Weekly Online on Wednesday that a decision has now been taken to place the underground project on hold, owing to continued low thermal and coking coal prices.

“Glencore is one of the most efficient longwall miners in Australia, but we are not immune from the ongoing market challenges. Unfortunately, the current market does not support the proposed project and we have decided to place Blakefield North on hold until we see improvement in the economic climate,” the spokesperson said.

“We remain confident of coal’s medium to long-term outlook and that our Hunter operations will play an increasingly important role in meeting this future demand.

“Presently, however, we have to ensure that the volumes and qualities of coal we produce are aligned with market requirements. We will not push incremental tonnes into markets that don’t want them or need them,” the spokesperson added.

The company estimated that some 340 employees and 60 contractors would be affected by this decision over the next two years, with employee consultation starting this week.

“We appreciate this decision will have impacts on our employees and their families as current underground operations reach the end of their scheduled life in 2017, as well as the local communities and businesses supported by our underground operations.

“We will be working closely with those employees affected during this difficult time,” the spokesperson said.

Operations at the Blakefield South underground mine would continue as planned until 2017, when its final longwall panels have been mined, while Glencore’s opencut mine at Bulga, which last year received regulatory approval to extend its mine life until 2035, would not be impacted by the decision.