Loss-making Whitehaven Coal is laying off 40 workers in NSW as it cuts costs to deal with lower coal prices.

News of the cuts sent the company’s shares to a near four-year low, further cheapening Nathan Tinkler’s major stake in the coal miner.

Whitehaven will make redundant 30 permanent staff and 10 contractors at its Rocglen and Tarrawonga mines in north-west NSW, two of the five mines currently producing coal for the company.

The cuts come as a sustained drop in coal prices, caused by weaker demand from China, continues to hit Whitehaven’s bottom line.

It made a $47 million loss in the first half of the financial year, and expects to post a similar loss in the second half of the year.

With no recovery in sight for coal prices, management has been running its eye over all parts of the business to find more ways to save money.

“As part of the review process it became clear that decisive action needed to be taken in order to ensure our open cut business remained viable in the current low coal price environment,” managing director Tony Haggarty said in a statement.

Whitehaven shares were down 5.5 cents, or 2.5 per cent, at $2.195 at 1530 AEDT, their lowest level since May 2009.

That takes the value of Mr Tinkler’s 21 per cent stake down to about $474 million, from $1.1 billion when Whitehaven merged with his company Aston Resources in April 2012.

Whitehaven employs more than 600 people, most of them in the Gunnedah basin in north-west NSW.

The move follows the announcement by global miner Xstrata that it will axe 100 jobs with the closure of its Brisbane office just six months after it sacked 600 workers from its NSW Hunter Valley mines and its Bowen Basin operations in Queensland.

It also emerged this week that mining giant Rio Tinto was cutting about 100 jobs from its struggling coal mines in central Queensland and the Hunter Valley.