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Yanzhou said its New South Wales subsidiary, which owns the Austar coal mine, recorded a 178 million yuan ($A29.5m) first-half loss.
Yanzhou bought what was originally called the Southland coal mine at the end of 2004, its first major overseas mine purchase.
In last year's annual report, the company said its investment in Austar would total 1.51 billion yuan ($A250 million), South China Morning Post reported.
Yanzhou uses LTCC mining methods in China to produce up to 10 million tonnes per annum from some mines.
