Santos Vice President Eastern Australia James Baulderstone announced the withdrawal as one of several initiatives the company is taking to develop its CSG business in NSW during the State Parliament’s Upper House Inquiry into CSG.

Mr Baulderstone also committed to have Eastern Star Gas' (ESG's) existing Narrabri CSG Project application reviewed.

“Santos appreciates public concern associated with CSG development and we are committed to demonstrating that CSG can be developed safely, sustainably and in co-existence with agriculture,” he said.

“We are conducting a thorough review of all of ESG's current operations and future project plans and will consult widely with local communities as we consolidate our development plan for northern NSW.

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“This is part of Santos’ commitment to working closely with the communities in which we want to develop our businesses,” said Mr Baulderstone.

The proposed 272 km Narrabri to Wellington pipeline was originally planned to transport CSG from ESG's tenements near Narrabri to its proposed gas-fired power station in Wellington.