The coal mining giant - which last week closed its coal lab at Gladstone - is taking the steps in response to softening coking coal prices, although its Queensland operations posted improved productivity in the six months to December.

BMA asset president Lucas Dow said: “A recent review of the Saraji mine by the company concluded that a fundamental improvement in the cost base of the open-cut operation is required to ensure that it remains competitive.

“BMA has made a number of changes across its operations to reduce costs and increase productivity to ensure that our operations are profitable and sustainable.”

According to The Australian, Platts reported that Queensland spot coking coal prices hit a six-year low of $US127 a tonne.

The Shanghai-based Freight Investor Services coking coal spot price was worse, posting a low of $124.5/t.

While most coking coal is not sold on a spot market basis, Macquarie Private Wealth signalled there was trouble ahead for the commodity about three weeks ago.

But there was hope that the company was succeeding in driving down its cost base and making the Queensland operations globally competitive after a damaging wages dispute and the effect of the floods over the last two years.

At the release of BHP Billiton’s half-yearly results, CEO Andrew Mackenzie said: “Our productivity continues to improve and this was most clearly demonstrated by our Queensland Coal business, which ran at an annualised rate of 68 million tonnes in the December 2013 quarter.

“Our productivity agenda is in full swing and we expect to carry strong momentum into the second half of the financial year.”

The recent cuts by BMA would suggest that the company has some way to go to keep the Queensland operations within its required level of profitability and productivity, according to some analysts.