Almost 40 jobs will be cut as production is halted at Boral’s Berrima Colliery this week.
Boral announced the colliery will be put into care and maintenance mode, suspending all coal mining activities.
The announcement comes after plans to double output at the Southern Highland’s coal mine were on Wednesday rejected by the Land and Environment Court.
Berrima Colliery operations manager, Stuart Hutchings, said transitioning into care and maintenance hasn’t been an easy decision.
“Our decision to enter 'care and maintenance' at the Colliery follows a review which confirmed that continuing mining at Medway was unsustainable in the current market,” he said.
“This is due to increased costs, in turn making it difficult for Boral to compete with imported cement material, and the flat outlook for cement sales generally.”
Expansion plans were challenged by the local Wingecarribee Council and Southern Highlands Coal Action Group when it was revealed heavy metals being discharged from the mine into the Wingecarribee River that were allegedly above accepted levels, The Southern Highland’s News reports.
Engaging the services of the Environmental Defender's Office (EDO), a merit appeal was upheld in court on Wednesday.
Boral said the move to suspend operations was a result of uncertainties arising from the planning system and the need to reduce costs in order to remain competitive in “difficult market conditions”.
“We remain disappointed that, despite a lengthy and rigorous assessment process over more than two years to secure the project approval as granted by the Government’s expert panel in 2012, this approval was overturned by the Land and Environment Court at Southern Highlands Coal Action Group’s instigation,” Hutchings said.
The coal mine which has been in operation since the 1920s provides about 220,000 tonnes of coal a year to Boral’s nearby Berrima cement Works and employs 40 people.
The company said it would work with mining contractor Delta Mining to support staff affected by the decision.
The company added that it remains committed to its cement operations at Berrima, which employ some 130 staff.
“Instead of using coal from the Colliery for cement manufacturing, we will start buying coal from third parties.”