The shutdown will affect close to 8000 miners who will be forced to take a three-week long annual leave.
The company will shut down all the 20 mines located across New South Wales (NSW) and Queensland including the Collinsville coal mine in north Queensland, and the Oaky Creek, Newlands and Rolleston mines in central Queensland. The company’s coal production will be cut by around five million tones as a result of the shutdown.
However, the shutdown will not affect the hundreds of employees who conduct critical maintenance.
The company had first announced the shutdown about a month back when it had said that the shutdown would not affect global prices.
The company’s statement had said: "This is a considered management decision given the current oversupply situation and reduces the need to push incremental sales into an already weak pricing environment."
However, the company also said that it was confident that the demand for coal would grow and the oversupply would be addressed over the medium term.
"We remain confident in demand growth for our products and believe that the supply and demand balance will be restored in the medium term," the statement said.
Currently, the company owns 20 coal mines at 13 mine complexes across NSW and Queensland, which produced more than 80 million tonnes of thermal and coking coal in 2013 and employed around 8,600 people.
