The application for coal seam gas exploration in Narromine was denied on Wednesday.
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The Minister for Resources and Energy Anthony Roberts announced the NSW Office of Coal Seam Gas (CSG) has informed the applicants, CEEMAC Pty Ltd that it has refused its Petroleum Exploration Licence Application.
The Narromine and Dubbo area was one of three applications the office rejected due to unsatisfactory information provided by the applicants.
CEEMAC had the opportunity to refute this.
"On July 8 2014, CEEMAC was given an opportunity to respond to an intended refusal of the applications and the OCSG sought additional information from CEEMAC on August 1 2014,'' Mr Roberts said.
"The OCGS has refused the three PELAs for the reason that the evidence supplied in support of the applications was not satisfactory."
Member for Dubbo, Troy Grant has welcomed the news.
"I join Resources and Energy Minister Anthony Roberts in welcoming this news and have been advised that the applicant, CEEMAC Pty Ltd, has been officially advised of the refusal," said Mr Grant.
"All three Petroleum Exploration Licences applied for by this company have been refused on the grounds that evidence supplied in support of the applications was not satisfactory," Mr Grant said.
"Any petroleum exploration or assessment licence that is granted in NSW has conditions that require the development of a groundwater modelling and monitoring plan in consultation with the NSW Office of Water or a produced Water Management Plan in consultation with the EPA and NSW Office of Water.
"The Government has put in place a range of protections including the NSW Aquifer Interference Policy and Code of Practice for Well Integrity to protect groundwater, banned the use of BTEX chemicals, banned the use of evaporation ponds for storing water and a requirement for operators to hold an Environment Protection Licence from the EPA.
"The cost of applying for a petroleum exploration licence in NSW has been increased from $1000 to $50,000 effective immediately this move in itself will deter speculators from making an application," said Mr Grant.
The other PELAs were near Lithgow and parts of the Blue Mountains and Coolah.