Mining and natural resources company Anglo American has announced that it will reduce the workforce at its Drayton mine later this year, as the planning approvals for the mine extension were delayed.

Drayton mine, which produces thermal coal, is situated in the Upper Hunter Valley of New South Wales, Australia.

As part of the plan, operations at the Drayton mine will be shifted from a seven-day to five-day roster in an attempt to slow down production and extend the life-of-mine.

According to the company, equipment at the mine will be removed and a few layoffs will take place.

The mine has a lease size of 1,768ha and is part of the 2,100km² Hunter Coalfield, the largest coal-producing region in New South Wales.

Drayton presently employs 500 people, although the company is considering relocating some workers to the adjacent operation.

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Drayton mine general manager Clarence Robertson told Australian Mining that the company was aiming to get approvals for the project in 2013, however, it failed to do so.

"We are persevering to secure state government approval for Drayton South, but as a result of the delays with the approvals process, we have run out of time to achieve the overlap we needed to keep the entire workforce employed while we developed the project," Robertson said.

Anglo American, the world’s fifth-largest diversified miner by market value, first filed the application for the thermal coal mine extension in 2011.

"We have run out of time to achieve the overlap we needed to keep the entire workforce employed while we developed the project."

The extension project faced strong opposition from local residents who attempted to block the development, claiming that it would negatively affect the local stud farming and wine industries.

The Drayton South mine will be a replacement for Drayton mine, which is expected to run out of coal in 2017.

Anglo American operates the mine and owns an 88.2% interest.

The mine partners include Mitsui Coal Development Australia (3.8%), Mitsui Mining Australia (3%), Hyundai Australia (2.5%) and Daesung Australia (2.5%).

Image: Drayton coal mine has been in operation since 1983. Photo: courtesy of Anglo American.