PERTH (miningweekly.com) – ASX-listed Metgasco would continue with its legal action against the suspension of its exploration licence in New South Wales, after concluding that the Office of Coal Seam Gas (OCSG) was not justified in suspending the licence.

The company had initially delayed its pursuit of a judicial review in the Supreme Court, after the OCSG agreed to review its May decision to suspend drilling at the Rosella exploration well.

However, the suspension remained in place, with the OCSG subsequently providing Metgasco with written material in support of its renewed suspension decision. The material, Metgasco said, demonstrated that there had been a seismic shift in OCSG’s interpretation of ‘effective consultation’, which was not in accordance with its own guidelines.

Metgasco told shareholders that the new material provided no justifiable basis for claims that community consultation was inadequate, or that Metgasco had failed to honour its approval obligations.

“Metgasco strongly believes that it has complied with the OCSG guidelines on community consultation. The company’s proposed consultation programme was specified for its drilling application lodged in March last year, and approved by the OCSG in February. The OCSG did not communicate any concerns about community consultation until a few days before the drilling rig was to be mobilised,” Metgasco MD and CEO Peter Henderson said.

Henderson expressed concern that the justification for the OCSG’s decision kept changing, with the most recent decision citing new and different reasons than the May decision.

“The prime reasons for the suspension decision appear to have little to do with Metgasco’s efforts to consult in good faith with the local community, but rather a concern about protests by activists who demonstrably have interest in consultation,” he added.

Over the past 10 years, the company has invested some A$120-million in the exploration for natural gas sources in New South Wales.