Centennial – bought by Thai energy giant Banpu in 2010 for $2.5 billion – is reviewing its capital expenditure in response to record high production costs and increased government processes and charges.

Centennial will redeploy the majority of affected employees to neighbouring sites across the group, minimising redundancies to approximately 40, Centennial chief operating officer Steve Bracken said.

Both mines will continue to meet safety and environmental regulations, while being appropriately maintained to enable a reopening when market conditions improve, he said.

“The decision to place these two mines on care and maintenance has not been taken lightly,” he said.

“Both mines have struggled to make a positive contribution in their own right, not only through the lower coal price but a combination of difficult mining conditions, poor coal quality and, in the case of Airly, transport costs have hindered the viability of these mines.”

In the current market, their losses can no longer be absorbed without negatively impacting the group’s overall performance, Bracken said

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Increased sales from Centennial’s coal mines were not enough to prevent a 46% plunge in Banpu’s reported net profit for the September quarter.

It was 2.26 billion baht, down 17% from the previous quarter. Sales revenue fell 5% to 29.22 billion baht year-on-year.

Banpu’s Australian sales rose 130,000 tonnes to 4.23Mt, outperforming its Indonesian counterpart, which reported a 200,000t fall in sales to 6.6Mt. Banpu's overall coal sales volume dropped 1% to 10.85Mt.