Gas companies will be permitted to explore for the mineral on 90,000 hectares of farmland surrounding the village of Bellata, after the state government resurrected the last "zombie" PEL in the North West on Friday.
Opponents of gas expansion accused the government of trying to bury a decision to bring back PEL 427 from the dead, in the hours before the federal election.
It is the last of 12 decades-old petroleum exploration licences (PELs), covering 55,000 square kilometres of farmland, which had long expired but, like zombies, could be reanimated at any time. All but three other PELS have been destroyed for good in recent weeks.
The Bellata PEL has been shrunk down to just 90,000 hectares, covering an area near Moree. It includes land in the Northern Tablelands electorate of Adam Marshall and the Barwon electorate of Roy Butler, both of whom oppose gas development in their electorates.
A spokesperson for the Department of Regional NSW said that the PEL "has been renewed in line with the NSW Government's Future of Gas Statement, which was released last year, reducing the total area covered by the PELs in NSW by 77 per-cent."
"The PEL remained in place while it was under assessment by the Department. The renewed area is significantly smaller than it was previously," he said.
"All PELs that were under assessment have now been resolved, with parts of them reduced, others renewed, and several refused."
Lock the Gate Alliance National Coordinator Georgina Woods said the timing of the renewal showed disdain for farmers and a desperate attempt to avoid scrutiny.
"It's shocking to see the Perrottet Government continuing to permit coal seam gas exploration on some of the state's best farmland," she said.
"In less than a month, the Perrottet Government has put more than one million hectares of NSW land and the groundwater beneath it at the mercy of the polluting coal seam gas industry.
"Coal seam gas is incompatible with a thriving agriculture industry and resilient rural communities.
"The Perrottet Government has given gas companies the green light to pockmark farmland with gas wells and further fuel dangerous climate change, which is in turn making it harder for farmers to grow food and fibre.
"As recent community meetings have shown, locals will not passively accept the renewal of these licences. The Perrottet Government now has one hell of a fight on its hands."
Shooters, Fishers and Farmers member for Barwon Roy Butler said the government risked serious backlash from its strongest supporters, who had what he said was "white hot" anger about the issue.
"The strange thing for me is that you've got groups like NSW Farmers and CWA who strongly oppose this, they strongly oppose Narrabri, they oppose these zombie PELs. Those groups are bread and butter for the Nats," he said.
"Yet they just stick their middle finger up at them essentially and say we'll we're going to go do it anyway. You sort of sit there and think what the hell's going on? Why would you do that to your base?"
He said almost no landholder near Narrabri was in favour of a plan to turn the region into a coal-seam-gas development zone, and the industry continued to pose major risks to groundwater.
Nationals MP Adam Marshall has written to deputy premier Paul Toole to clarify the status of the tiny section of the PEL in his electorate.
"I'm delighted the PEL has been reduced by more than three-quarters to remove it from our region, but am clarifying a very small section of the PEL, which I suspect may have been an administrative error," he said.
The state government quashed PELs near Murrurundi, Scone and east of Moree earlier this month.
In April the government resurrected PELs near Narrabri, Boggabri, Quirindi and Gunnedah.
It approved the Santos-owned Narrabri Gas Project in 2020.
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