Solid Energy chief executive Don Elder says job cuts are necessary despite predictions that coal prices may be back to sustainable levels next year.
The company on Monday announced some 460 jobs would go as it restructures its business to cope with the global downturn in coal sales.
Spring Creek mine near Greymouth will be the worst hit, with the jobs of 234 staff to go and those of 130 contractors on the line.
Sixty-three job losses have been confirmed at Solid Energy's Huntly East mine in Waikato, and staff numbers at the company's Christchurch head office would fall from 313 to 150.
Dr Elder told Radio New Zealand's Morning Report programme that although some predict prices will return to normal next year, there is too much uncertainty in the industry to retain all staff.
"People are saying it feels as though we could be down for quite a while," he said.
"We'd like to think we'll be back next year - some market observers are talking about markets coming back in 2013 - but you can't afford to bet the company on that.
"You have to do the right thing to make sure you can survive no matter what happens."
Pike River purchase
Earlier this year Solid Energy agreed to buy the Pike River coal mine for $7.5 million dollars, and Mr Elder says in hindsight the company would rather not have the mine.
Initially, Solid Energy was not interested. "It was only when the receiver came back to us in February and said, basically, you can have it for the value of assets you'd be able to sell in a year or so that we became interested," Mr Elder says.
Mr Elder says the mine hasn't really cost Solid Energy anything because it can sell the assets it got within a reasonable space of time.
He says the company is not going to walk away from commitments made to the Government and bereaved Pike River families, but says this has cost it time and effort.