Gillard said hopes of finding survivors had been raised by last month's miraculous rescue of 33 Chilean miners and a similar incident in Australia in 2006, only to be cruelly dashed when a second blast tore through the pit.
"Australia and New Zealand have shared this tragedy as we have shared tragedies before in our history," Gillard told parliament, adding that she had passed on her condolences to New Zealand counterpart John Key.
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"After Beaconsfield then Chile this year I suppose in some part of our minds we were always hoping, always thinking that there's going to be a happy ending. Unfortunately, and tragically, there wasn't."
The Chilean rescue echoed the so-called "Great Escape" of Australia's Brant Webb and Todd Russell, who spent two weeks trapped in a tiny underground chamber at Tasmania's Beaconsfield mine after an earthquake.
On Monday, Chinese rescuers pulled 29 workers from a flooded coal mine in Sichuan province.
Flags were at half-mast on government buildings and the iconic Sydney Harbour Bridge. Two Australians died in the disaster along with two Britons and a South African.
