Workers from the Dendrobium mine, one of the three mines South32 operates near Wollongong, are considering a strike and have applied for permission to hold a protected ballot, expected later this week.

The enterprise agreement for workers at the Mount Kembla mine expired in April 2014, and agreement over a new deal has proved elusive ever since.

Low coal prices had seen thousands of Australian jobs lost over the past two years, and a large part of the dispute related to clauses about job security that Dendrobium workers want included in a new enterprise agreement in a bid to protect themselves against casual workers.

The 2014 financial results submitted to the Australian Securities and Investments Commission, the Dendrobium operation had 290 workers, with almost 200 believed to be members of the Construction, Forestry, Mining and Energy Union.

The broader Illawarra coal business, including the Appin and West Cliff mining operations, had about 2500 full time workers, and many of those workers were thought to have similar demands to the Dendrobium staff.

Enterprise agreements for workers at West Cliff and Appin expired last month, and staff from those mines may take similar action to their colleagues from Dendrobium in coming weeks.

Closure rumours not helpful

Dendrobium mine supplied coking coal to BlueScope Steel's struggling Port Kembla steelworks, and rumours that the steel mill could soon close were not helping confidence in the region.

South32, which inherited the Illawarra coal business from BHP Billiton in this year's demerger, had gone to the unusual length of giving workers a pay rise before the new workplace deal was finalised, and the company indicated it was committed to finalising a new enterprise agreement.

"Since late 2013, we have been working with employees and their representatives to develop a new enterprise agreement for mineworkers and trades employees at Dendrobium Mine," said Illawarra coal asset president Troy McDonald.

"As a sign of good faith to our employees, we have commenced for a six-month period, the pay increase that has been the subject of negotiations while discussions continue.

"Illawarra Coal looks forward to working with Dendrobium employees and their representatives to achieve a resolution, in this difficult economic environment for the coal industry, in the near future."

Coking coal prices traded above $US300 a tonne in 2011, but were fetching about $US82 a tonne over the past week, with the product produced by BHP in Queensland's Bowen Basin considered to be the benchmark.

South32 shares closed 1¢ lower on Tuesday at $1.715.