“We commenced the introduction of inert nitrogen into the affected area at midnight last night and we are following a controlled process to starve the fire of oxygen,” an Xstrata spokesman told ILN.

“There is around-the-clock real time gas monitoring throughout the mine and any decisions regarding re-entry to the underground will be determined by the monitoring results.

“We are not able to predict how long it may take to put the fire out and will be relying upon our monitoring to determine when the underground environment may be safe for us to re-enter and commence our investigations into the incident.”

The spokesman said the size of the fire was still not possible to determine but it “remains in the longwall area”

Blakefield South, designed to replace the nearby Beltana mine, is the company’s newest Australian coal mine and commissioned its new longwall equipment in June.

The spokesman said the gas monitoring in place was extensive as it was known to be a gassy mine.

Xstrata is not speculating on the cause, especially if the fire was triggered by a spontaneous combustion incident.

Few details have emerged, but ILN understands that men at the face first heard a bang and then saw an orange glow in the goaf behind them which was the fire.

While it is not possible to determine how long the mine might remain closed, some of the workforce could help out other Xstrata longwall mines in the state.

“All employees are currently being paid and, if necessary, we will consider redeploying our people to other Xstrata coal operations until such time as the mine is reactivated,” the spokesman said.

Located in the Upper Hunter Valley, ramp-up activities at Blakefield South have been underway for months.

The mine was aiming to hit the goal rate of 6.5Mtpa run-of-mine production by the end of 2011 to yield about 4.5Mtpa of export thermal coal, and ROM capacity was estimated to be around 4Mtpa in December.

Blakefield South was designed to mine nine panels in total, and the first panel was previously due for completion around February.

The mine did not have an Air Liquide Floxal nitrogen generator to continually minimise oxygen levels in its goaf areas.

The mine would have consequently used a Tomlinson boiler to inert goaf areas when the need was determined by gas monitoring.

The Beltana operation was a longwall production leader for several years and was scheduled to cease mining last month.