The NSW government's announcement of finalised safeguards to protect homes and high quality farmland from coal seam gas projects has upset groups on both sides of the CSG debate.
NSW Deputy Premier Andrew Stoner said on Tuesday the finalised reforms struck the right balance for communities and industry and were the strictest regulations around CSG projects in Australia.
CSG exclusion zones were in force for an estimated 95 per cent of dwellings covered by current petroleum licences and tough regulations were in place for NSW's most valuable agricultural land, he said.
"Today marks a significant milestone in this government's commitment to balance the energy needs of the state and the need to support our vital agricultural industry," he said in a statement.
CSG exclusion zones now applied to 2.7 million hectares in NSW, Mr Stoner added.
In addition, about 2.8 million hectares of valuable farming land was safeguarded by ensuring the impacts on land and water or resource proposals were considered upfront through the independent scientific Gateway process, he said.
Protection of "critical industry clusters" includes 60,000 hectares of vineyards and horse studs in the Upper Hunter region.
But the Australian Petroleum Production and Exploration Association (APPEA) said the government had further dented the credibility of its pursuit of science-based energy policy with its announced restrictions.
"The NSW government has dreamt up yet another layer of arbitrary and politically-driven regulations for an industry the state desperately needs," APPEA Chief Operating Officer Eastern Region Paul Fennelly said in a statement.
"Despite knowing that NSW imports 95 per cent of its gas supply and that a failure to develop local supplies will lead to higher energy prices, the state government has again turned its back on both the science and the industry's proven track record."
"It is not surprising to see NSW's reputation as a place to do business slipping," Mr Fennelly said.
The Nature Conservation Council of NSW, meanwhile, said the safeguards were a "common sense" victory for those concerned about CSG projects in urban areas but "key water resources and sensitive environmental areas" remained at risk.
"Drinking water catchments are still not protected, neither are important natural assets like the Pilliga Forest, which is set to be carved up and polluted by gas development," campaigns director Kate Smolski said in a statement.
The NSW Greens called on the government to increase the amount of land protected from coal seam gas mining.
"Only 3.37 per cent of NSW's land area is protected from fracking for coal seam gas, and only 0.4 per cent of land is classified as a critical industry cluster," Greens MP Jeremy Buckingham said in a statement.