Low coal export prices and the high Australian dollar have forced the mine's owner, Centennial Coal, to make the cuts.

"This decision has not been taken lightly, and is essential if Centennial is to sustain its competitiveness and market position," Centennial Coal's chief executive and managing director David Moult explained.

"In the current market Newstan's losses can no longer be absorbed."

Newstan last went into care and maintenance mode for three years (2009-2011). It recommenced operations in 2011 in response to the then strong export market.

Newstan employs 148 people.

Centennial said about 45 staff would be redeployed to its Myuna Mine.

The remaining Newstan staff would be retrenched.

"This has been an extremely difficult decision.

"Centennial is committed to diligently working through a process that will sensitively support those impacted," Mr Moult said.

Centennial said it would take steps to ensure it was in a position to recommence mining at Newstan when markets conditions improved.

There has been mining at Newstan for more than 125 years.