The Tasmanian Government will ban the controversial mining practice known as fracking for another five years.
Fracking involves injecting liquid at high pressure into underground rocks to extract oil or gas, and the practice has sparked controversy in New South Wales and Queensland.
Tasmanian Primary Industries Minister Jeremy Rockliff, who declared a one-year fracking moratorium in March 2014, considered 155 submissions on the subject.
Mr Rockliff said there was uncertainty around fracking, and his decision would "protect Tasmania's reputation for producing fresh, premium and safe produce".
"There is considerable concern around the potential negative impacts of fracking, particularly within our rural communities and farming families who rely so heavily on our global reputation for producing premium and safe products," he said.
"It is also clear that there is considerable concern for landowners' rights and public and environmental health.
"After consideration, advice and consultation, it is prudent that we introduce a five-year moratorium on fracking in Tasmania."
Shortly after the ban was announced the Northern Territory Government released a report which found "no justification whatsoever" for a moratorium on the controversial practice in the Top End.
Company to reassess exploration plans
Exploration is currently being carried out in a wide area of the Southern Midlands to see if it is viable to extract shale oil gas.
Adelaide-based company Petratherm has a five-year licence to look for shale oil and gas over about 4,000 square kilometres of southern Tasmanian farmland.
Managing director Terry Kallis said the moratorium was politically motivated and the company's board would now consider whether to take its business elsewhere.
"There's no real science underpinning this decision," he said.
Mr Rockliff insisted the five-year ban did not mean an end to shale oil and gas exploration in the state and the three companies that were awarded exploration licences could still be able to do limited searching.
"Our decision does not preclude exploration to see exactly what the resource is available, it's just the exploration cannot use hydraulic fracturing methods," he said.
A review into the practice of fracking will be conducted before the moratorium expires in March 2020.
Industry groups, including the Tasmanian Farmers and Graziers' Association (TFGA), Dairy Australia and Wine Tasmania all urged the Government to extended its moratorium.
TFGA president Wayne Johnstone applauded the decision.
"It's a really good decision that this Government has made to allow us a bit of breathing time, for all of us to have a good look at the fracking issue, to have a deep breath," he said.
The TFGA wants the Government's review to consider the legal consequences of mining on private land and the legacy of fracking, as well as the science behind it.
There had been considerable concern in Tasmania's Midands over the past two years, with local residents holding community meetings in Oatlands.
There is a moratorium on fracking in Victoria and there have been calls for similar bans in Western and South Australia.