The chief executive of Snowy Hydro Paul Broad says tapping into the Sydney to Newcastle gas pipeline is the most efficient short term option for fuelling the federal government's proposed Kurri gas power plant.
Mr Broad, who lives in Newcastle, said discussions were already underway with Jemena regarding the best way to supply gas to the plant.
"It's the only source at the moment. If we can get another source into Newcastle we can work this plant much harder," he said.
"The plan is to suck it out of the pipe into a lateral so it can be zig-zagged into the Kurri site, so that becomes a really big storage for us."
"If Narrabri (coal seam gas project) gets up we will then be able to bring it in from there as well."
While the federal government is yet to commit to building the 750 megawatt plant, that would be used to compensate for the loss of coal-fired generation, it appears increasingly likely to project will get the go-ahead.
The state government is presently assessing an application for the project, which has been classified as an item of state significant infrastructure.
A spokesman for Jemena confirmed it was in discussions regarding supplying gas to the plant.
"We're talking to a number of proponents about bringing potential gas supply into the Hunter Valley to support gas-fired-generation in the area, including Snowy Hydro," he said.
"We're working closely with these stakeholders to ensure pipeline solutions are in place by the time they are needed, so these projects can proceed with confidence that supply will be available."
The Eastern Gas Pipeline, the main transmission pipeline that runs down the east coast, would be another option for fuelling the plant using existing infrastructure.
Mr Broad has also called for a renewed community discussion about accessing local gas resources to meet the region's energy needs.
"I would argue, perhaps controversially, that in the Hunter we have more gas underneath us than society needs for the next 200 years," he said.
"We should have an adult discussion about how we access that gas. Some of the attempts to do it in the past have been poor. We have got to have the conversation with people properly, but I do think of gas as a transition fuel as we move away from coal; you can't have renewables unless you have fast-start (electricity generation) that fills in the gaps and gas and hydro are the key to that."
Mr Broad's comments come at a time when environmental groups are urging the state government not to renew existing petroleum export licences, such as Petroleum Exploration Licence 456, which covers a large tract of land in the Upper Hunter.
The state government permanently extinguished PEL 458, which covered most of the Lower Hunter, in 2016 following community concern about the impact of coal seam gas drilling in urban areas.
Hunter MP Joel Fitzgibbon said he believed the accessing gas from the Narrabri gas project via the yet-to-be-built Hunter Gas Pipeline would be the most efficient way of fuelling the Kurri plant in the long term.
"It is for the market to determine. The market will do whatever is most efficient for it," he said.