One of the Hunter's federal Labor MPs says he has not seen a business case that has convinced him an oil or gas industry in water off the Hunter and Central Coast would be economically viable.
But Shortland MP Pat Conroy says a Labor government could not revoke the PEP11 exploration license - which covers a patch of ocean off the east coast - because such a move would require "significant financial compensation".
His comments came after Labor committed this week to a review into strengthening seismic testing controls if elected on Saturday.
Ongoing plans for seismic testing off the coast of Newcastle by Asset Energy, the firm that conducted a 2D seismic survey in search of gas last year, has prompted several community rallies since 2017 when the plan attracted attention.
Mr Conroy told the Newcastle Herald on Thursday he had been approached by people "from all walks of life" who were concerned about the possible impacts that seismic testing and potential drilling could have on tourism, fishing and the environment.
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Given his party would not be able to revoke the PEP11 licence, because it had been legally granted, he said the aim had become making sure any application to extract gas "goes through the strongest possible national environmental laws".
"Even if it satisfies the environmental laws, and that's a big if, we have to make sure that competing economic interests are accounted for and the climate change impact of extracting the gas is accounted for," he said.
"I think there are a lot of hurdles for any project to go ahead."
Protect Our Coast Alliance member Callan Lawrence, who was among representatives of several groups who met with Mr Conroy to discuss the issue recently, said there was "no social licence" for the project.
Federal Resources Minister Matt Canavan announced in March the introduction of a 30-day period for people to give feedback about environmental plans lodged as part of applications to the Commonwealth authority, NOPSEMA.
Asset Energy said at the time it anticipated the environmental plan for its next round of seismic testing would be open to public feedback.
The company has previously said its operations would not have a detrimental impact on the environment.