Patriot chief executive officer Richard Whiting said the mine would be idled from today following a rigorous review.
Announcing the company’s fourth quarter results via a conference call, Whiting said its power customers were unfortunately reverting to cheaper natural gas options resulting in a decreased demand for the mine’s coal.
The decision to idle the mine is despite it producing 1.8 million tons of thermal coal in 2011.
“Looking forward, we believe Patriot and our stockholders are best served by leaving our high-quality coals in the ground until demand for these products strengthens," he said.
Looking ahead to 2012, Whiting anticipated the mine to be up and running by sometime during 2012 when market conditions improve.
Economic uncertainty which has impacted on metallurgical coal demand has also resulted in the miner reducing production of high quality met capacity at its Rocklick and Wells complexes.
Despite plans to reign in production, Whiting had an optimistic outlook for 2012.
“As the economy strengthens and demand returns we see excellent potential for met coal margin expansions,” he said.
Patriot lost $38.3 million in the December quarter and $115.5 million in 2011.
Its fourth quarter sales volumes totalled 7.6Mt, up from 7.4 in the previous quarter, however Patriot said this was 500,000t lower than what it anticipated for the year.
Patriot said it planned to sell between 27Mt and 29Mt of coal this year, down from 31.1Mt in 2011.