The company, which had been seeking an extension of the mine's life until 2045, set the new date for the end of production on Thursday after failing to find a buyer for the mine

The announcement sent shockwaves through the Upper Hunter community and the families of the 2000 workers who are employed at the mine.

The closure of Mt Arthur will also mark the end of BHP's association with the Hunter, which began with the opening of the Newcastle Steelworks in 1915.

BHP estimates the job of rehabilitating the 6600 hectares occupied by the state's largest coal mine will take between 10 and 15 years.

"We take our responsibility to the future of the region seriously. We want to use the next eight years working with the community on a plan that contributes to helping the region diversify and strengthen its economy," mine manager Adam Lancey said.

Employees, local suppliers and businesses, Indigenous groups, governments and community leaders will be among the groups consulted.

In a statement to the Stock Exchange on Thursday morning BHP acknowledged that Mt Arthur Coal had been financially challenged for a number of years despite the current booming coal prices.

"New approvals and significant capital investment to develop into new areas would be required to keep the mine running beyond 2030."

The mine's current approval expires in June 2026, however, Mr Lancey said he was confident the mine would receive a four year extension.

"We don't anticipate the current prices to last forever but certainly while they are around we will try and make hay. The reality is we want to be able to utilise the timeframe of eight years to get the relevant inputs so we can ultimately get the best possible outcome," he said.

"We will be maintaining our current throughputs through to the late 2020s. Then there is a natural tapering as you get into that closure but we will be maintaining a reasonable run rate right into that period."

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BHP estimates that about 35 per cent of Mt Arthur's workforce will be at retirement age in 2030.

Mining And Energy Union northern district president Robin Williams said the eight year timeframe would cause concern for those who needed to find alternative employment. The union has urged BHP to reassure its employees about the steps being taken to invest in their future.

"BHP has made and is continuing to make enormous profits from the Mt Arthur mine, especially with current high coal prices," he said.

"We will be advocating on behalf of our members and their families that BHP mustn't just cut and run, they must invest in a plan for the future of jobs and economic activity in the area."

Lock the Gate Alliance National Coordinator Carmel Flint welcomed the news that BHP had scrapped its 19 year expansion plans.

"This is a very significant step by BHP, and the absence of buyers for the mine sends an incredibly strong message that thermal coal is in decline globally, as customer countries act on climate change," she said.

"It's incredibly important that BHP now puts all its effort into supporting workers to find alternative, sustainable employment, backing new economic opportunities in the Hunter and properly rehabilitating the site.

"The Hunter Valley and its communities have sacrificed a lot for the coal mining sector and it's long past time for the industry to give back. We're still of the view that the mine should close in 2026 as previously planned - the world can't afford to keep delaying climate action.

"It's taken too long for BHP to read the writing on the wall. Had the company committed to shutting down Mt Arthur instead of trying to sell it several years ago, it could have already spent that time retraining and supporting workers."

But NSW Minerals Council chief executive Stephen Galilee said the eight year timeframe provided certainty for workers and local communities and a pathway towards significant potential post-mining opportunities at the site.

"BHP's intention to seek a four year extension to allow mining at Mt Arthur to continue for another eight years until 2030 will ensure those that rely on the operation for employment can continue to do so for years to come, while also planning for the future," he said.

He said the eight year timeframe provided an opportunity to ensure post-mining opportunities were maximised.

"Currently, restrictive planning arrangements relating to consents and post-mining land use are a significant barrier to a range of potential future opportunities," he said.

"NSW Minerals Council has been a long-term advocate for changes to current planning laws to provide mining operations with greater flexibility on post-mining land use. Such changes should enable mining operations to amend their existing post-mining approval conditions in response to community needs so local mining communities receive the best possible outcomes.

"The NSW Government's Draft 2041 Hunter Regional Plan clearly recognised the need for such changes. Such recognition in the final Plan later this year should help facilitate their future design and implementation."

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