But Prayuth Chan-ocha, a former army general, left open the possibility of the mine in central Thailand re-opening, saying he only ordered its "suspension" not closure.

"I would like to ask the Australian company not to sue us because it will be a waste of time and have no benefit for either side," he was quoted by The Nation newspaper as saying.

"We just suspended the gold mine operation in waiting for the new Mineral Bill to become law and the setting up of a mining committee, so they can investigate the mining operation and its impact on the people."

For months Mr Prayuth's government has been sending confusing signals about the future of the Chatree mine operated by Kingsgate subsidiary Akara Resources which has been the target of a sustained campaign by a small number of local land owners and environmentalists.

But Akara insists that multiple studies, including by Thai government agencies, have failed to produce any evidence that the mine had damaged the surrounding environment, health of workers or nearby residents since it opened in 2001.

More than 1000 workers at the mine in Phichit have lost their jobs as the open-pit and processing plants which will be put under a care and maintenance program on New Year's Day.

Leaders of towns near the mine say the sackings and closure of the mine will have a devastating impact on one of Thailand's poorest areas.

In his latest comments, Mr Prayuth promised justice for both the company and local people but did not elaborate.

"This will be the duty of the mining committee, while the government will have a duty to take care of both investors and the people," he said.

Kingsgate Chairman Ross Smyth-Kirk told Fairfax Media last week that the forced shutdown has sent a "horrendous" message to potential foreign investors in military-run Thailand, after earlier declaring his company would seek compensation for the decision.

He said it would take an "ironclad guarantee" that his company would be allowed to operate without interruption before it again invested in the military-run country.

Mr Prayuth's order in mid-December to shut down Chatree was the first time he had used his absolute powers against a commercial business since he led a coup to topple a democratically-elected government in 2014 after months of political instability.

The decision caused Kingsgate's shares to plummet 19 per cent in a single day and shocked foreign business leaders in Thailand where foreign direct investment has dramatically fallen since 2015, and the economy remains sluggish, growing at a far slower rate than neighbouring Vietnam, Indonesia and Malaysia.

Thailand's military-stacked parliament passed a law allowing gold mines to operate legally only days before Mr Prayuth's intervention which also stipulated that gold mines must now rehabilitate mining areas or their operators could face fines and/or a year in jail.

Mr Smyth-Kirk has said there had been suggestions of a behind-the-scenes plot to force Kingsgate from the country so others could operate the mine.

"I have seen no evidence of that," he said. "I can't really speculate."

Thailand has reaped tens of millions of dollars in taxes and royalties from Thai Stock Exchange-listed Akara which had been planning to invest a further $US1 billion ($1.34 billion) to continue mining on adjacent leases for another 20 to 30 years, raising several billion dollars in revenue, company executives said.

Kingsgate now plans to open a mine in Chile.