State-Owned Enterprises Minister Todd McClay has asked Solid Energy to make sure Huntly East mine workers are supported.
Solid Energy plans to close the underground mine, ending almost 140 years of coal mining in the district.
The company says the mine is losing $500,000 a month and there is no prospect of achieving profitability, or finding a buyer.
Mr McClay said Solid Energy workers were guaranteed full redundancy.
"It will be a difficult time for the workers there in that community. I've asked Solid Energy to support those workers and to engage with MSD (Ministry of Social Development) to do whatever we can do for them."
The closure of the mine was not unexpected and the mine was nearly at the end of its life, he said.
"The coal price remains extremely low. It's a very high cost mine. The last remaining underground coal mine in New Zealand and it's been losing money for some period of time."
But New Zealand First's Richard Prosser disagreed, saying the pending closure of the mine was the result of mismanagement.
"They could have done a great deal more, done it a great deal sooner and come up with a far better result. Obviously, redundancy and the closure of the operation is not something that is a good result for any worker."
The Greens' spokesperson on workplace relations, Denise Roche, said the Government should help workers transistion into new jobs.
Ms Roche said the Government should be investing in environmentally-friendly technology, such as solar power, which she said would create more jobs.