Environment campaigners say the only way to ensure drinking-water catchments are safe from damage during coal-seam gas operations is to ban gas extraction in those areas permanently.
News that coal-seam gas operator Santos had been fined after contaminants leaked into the underground water at its Pilliga Forest operation has campaigners asking if the industry can ever be safe enough for drinking water.
Santos was fined $1500 and must monitor the groundwater after elements, including uranium at 20 times the safe drinking level, were found in the aquifer.
In the Illawarra, coal-seam gas exploration work has stopped after the NSW government last year slapped a temporary ban on catchment special areas, pending a review of the industry by chief scientist Mary O'Kane.
Special areas are those closest to the water body, and entry is not allowed without permission.
Stop CSG Illawarra spokeswoman Jess Moore said only a permanent ban in special areas made "common sense".
"The industry is still trying to set up shop in the catchment, with current exploration licences there," she said.
"CSG exploration and mining always involves unearthing water that is high in salt and methane, and can contain toxic and radioactive compounds and heavy metals. It involves methane leaks and industrial development that's incompatible with our drinking water catchments."
The Mercury asked Resources Minister Anthony Roberts on Wednesday if he was confident coal-seam gas operations could be conducted safely near water catchments. His spokesman said he would await the review report.
A bill is before NSW Parliament that, if passed, would cancel any coal-seam gas licences in the Sydney and Illawarra catchment special areas, and ban them being renewed.
The bill, introduced by Labor leader John Robertson, is set to be voted on next Thursday, but it will not have the numbers.
"The government made it clear that it opposes the bill on the basis that it pre-empts the findings of the chief scientist," Mr Roberts's spokesman said. The Mercury understands Professor O'Kane's review should be finished mid-year.
An Environment Protection Authority spokeswoman said the authority was confident "the measures put in place by the NSW government to protect the environment, and under which CSG operators in NSW are accountable, are adequate to protect water resources in NSW".