Glencore has halted production of its proposed Blakefield North underground coal mine in New South Wales, Australia, due to weak thermal and coking coal prices globally.
The company was supposed to start longwall production at the project in 2017, which would have extended the life of existing underground operations at the Bulga complex outside Singleton.
The decision is expected to affect 340 employees and 60 contractors who are currently working at the mine.
Glencore spokesperson said that as planned operations at the Blakefield South mine will continue until 2017 when its final longwall panels have been mined.
The spokesperson said: "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."
However, the decision will not have any impact on Glencore's open-cut mine at Bulga.
The Bulga mine received regulatory approval in 2014 to extend its mine life until 2035.
Glencore said in a statement: "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 company has already started consultation with Bulga underground employees with regard to its decision.
Image: Glencore's Bulga complex located outside of Singleton. Photo: © Glencore.