Metgasco “very disappointed” as gas drilling licence remains on hold

Metgasco’s drilling permit near Lismore in New South Wales will remain suspended after a review by the Office of Coal Seam Gas found the company had failed in aspects of its Activity Approval.

The gas company said it is very disappointed at the outcome of the government review and said it is analysing the decision and the reasons for maintaining the suspension.

NSW Resources and Energy Minister, Anthony Roberts, suspended Metgasco’s drilling licence in May just days before the company was set to commence operations at the Rosella well.

Roberts stated the company needed to prove it had undertaken "genuine and effective consultation" with the community.

Roberts said the OCSG had advised him of concerns expressed by local community members about the way in which Metgasco had characterised its activities and that this lead to the suspension. 

Metgasco has since provided the OCSG with information around its community consultation program in the hope the drilling ban would be overturned.

The company previously said the detailed submission it provided to the OCSG demonstrated that it had “fully complied with licence conditions relating to community consultation”.

However the OCSG disagrees, with Roberts stating the company’s operations will remain suspended until the regulatory body is satisfied Metgasco had met the conditions of its title and the conditions of the Activity Approval.

The matter will now head to the NSW Supreme Court where Metgasco is seeking to have the suspension overturned.

The company claims the decision was not authorised by legislation, and was made without affording it procedural fairness and will ask the Court to rule that it had complied with its community obligations.

It said it was also look into whether it could sue the government for damages and financial losses sustained as a result of the suspension, expected to amount to $3 million.

Metgasco’s managing director Peter Henderson said the government should be defending exploration and investment in the gas sector.

Henderson said the government should not be “intimidated by activists making spurious and ill-informed claims about drilling for natural gas” at a time when the community was facing a crisis shortage in natural gas supplies.

The decision to suspend Metgasco’s licence came after almost three months of protests by locals who oppose the well exploration program.  

Roberts has been unapologetic in his decision to suspend the drilling permit. 

“The government will continue to vigorously pursue titleholders to ensure they maintain high standards of community consultation,” he said in a statement.