The Government intends to meet the Pike River families' request that the site is turned into a conservation area and a memorial established to the men who died.
Mine owner Solid Energy announced yesterday it will not re-enter the West Coast mine to recover the remains of the 29 men killed in 2010, and has relinquished its mining permit to the Government.
Prime Minister John Key said the company's decision had the Government's full backing.
Mr Key said the Government would accommodate a range of requests from the families to ensure the area around the mine was protected as a mark of respect.
"What we now intend to do through the Minister of Conservation, Nick Smith, is to work to ensure that the memorial site that's established reflects the gravity of the situation and the enormous loss that New Zealand has gone through and the families have had to suffer".
Along with the request that no mining takes place there again, the families want the area is given suitable reservation status to protect its integrity and sanctity, and that they be given unfettered access to the area in perpetuity.
John Key believes, for the most part, the Government can meet those requests.
"So in terms of the surrendering of the mine permit, the turning of it into a conservation area, the access to the memorial site, the establishment of a memorial, all of those things can and will happen".
Bernie Monk, spokesman for many of the families, has battled tirelessly for four years to try to have the body of his 23 year old son, Michael, recovered from the mine. He now concedes it may be time for he and his family to move on.
"I've got to seriously, over the next day or so, realise, do I move on from this completely, and support the rest of the families in doing that? And I think I've got a role there to lead, I've got to make a decision very quickly, and if this proposal that we're putting forward is very fruitful for the area, I'll have to run with that.
"I mean, I want to get my guys home but the likelihood is pretty minimal now. It's my life, I've got to get on with my life".
Throughout the past four years,
Mr Monk's brother-in-law, lawyer Colin Smith, said the families now need to be brave.
"We have seen the toll that it has taken on individual families, particularly Bernie. And, as Bernie quite rightly said, how much longer to you submit families to that sort of torture? This is a positive way forward".
Others in Greymouth also feel it's time to move on.
Greymouth Business Association spokesperson Clark Ellery said everyone had been affected in the past four years.
"The news has gone a long way to bring as much closure as possible without recovery of the bodies. Nothing is going to be a perfect result but we're probably getting as close as we can get".
Stuart Nimmo had photographed the mine several times before the explosions and since then has worked closely with the families to create images and photo placards. He welcomed the news a reservation area may be created.
"It's a beautiful area, it's an amazing area, it's just gorgeous. And that's part of the tragedy in a way too. I guess if it can be turned into some sort of area that is going to be beneficial for our district and our people and our country, that's got to be great".
The general manager of the Greymouth i-site, Gina Ashworth, said it was time the town is recognised for something other than tragedy.
"Tourists are here mainly for the scenery, they want the do the activities, experience the hospitality of the Coast. They're not really wanting to see the monuments and memorials and that side of the Coast".
Nick Smith, acting as Conservation Minister on this issue, has told the families he is ready to start talking about plans for the site as soon as they are ready.
"I will open up a dialogue with the families about the longer-term future of the site, and I will take advice directly from the families when they feel the time is appropriate.
"We will work hard to provide the families with closure and appropriate ways to remember their men," he said.