The company said that high-currency exchange rates and low export prices have been affecting the Australian coal industry.

As a result, Centennial Coal is seeking to lower costs and increasing productivity across its operations.

Centennial Coal CEO and managing director David Moult said: "This decision has not been taken lightly, and is essential if Centennial is to sustain its competitiveness and market position. In the current market Newstan’s losses can no longer be absorbed."

Of the 148 workforce at the colliery, 45 members will be moved to Centennial’s Myuna mine in Wangi Wangi. Newstan was under care and maintenance for a three-year period and recommenced operation in 2011.

The company said it will continue to advance the Northern Coal Services and Newstan Extension projects based on market conditions in the future.

"Securing new approvals for both Projects will secure the significant coal resources at Newstan which are in close geographic proximity to local power stations and the Port of Newcastle, and will place Centennial in a position to recommence mining at Newstan when markets conditions improve," it said.

Image: Newstan underground coal mine in Western Lake Macquarie. Photo: courtesy of Centennial Coal.