The federal opposition has called on Resources Mminister Keith Pitt to reject the renewal of a gas and oil drilling permit off the NSW coast.
Petroleum Exploration Permit 11 (PEP11), which is due to expire this month, allows mineral exploration in 4500sqm of ocean between Sydney's northern peninsula and Newcastle.
Permit holders Advent Energy and Bounty Oil and Gas are seeking a renewal of the exploration licence and permission to undertake exploratory drilling in the area, arguing it may hold significant mineral deposits.
The permit area is primarily within commonwealth waters, which begin 5.5km offshore, and Opposition Leader Anthony Albanese has called for its cancellation.
"We're very clear across the board - all the local members here as well as the Australian Labor Party in Canberra will oppose this project," he told reporters on Friday.
"This is a natural asset that we need to protect ... this is an asset that is an important part of the way of life for those communities.
"The idea that you would have exploration for oil and gas just off this coast is a disaster, even if things go as well as they possibly could have.
"But if they don't, then it's potentially catastrophic."
Mr Albanese said he wasn't inherently opposed to oil or gas exploration but some proposals under PEP11 were too close to shore.
They could also affect the nearby NSW Great Lakes Marine Park.
Mr Pitt is tasked with approving or rejecting the PEP11 renewal, alongside NSW Deputy Premier John Barilaro.
He said PEP11's future would be assessed by regulators like any other matter, with no decision yet made.
"We work our way through the regulatory system in a systematic and methodical way, we make decisions on fact," Mr Pitt told Sky News.
"'Each way Albo' has become 'no way Albo'.
"It's no way for coal, it's no way for offshore oil and gas."
Independent Warringah MP Zali Steggall and local Liberal MPs including Mackellar MP Jason Falinski also want PEP11 canned.
Mr Falinski last year moved a motion in the House of Representatives calling for the cancellation of PEP11 and emphasising the importance of Sydney's coastline to the local environment and tourism.
Environmental group Save Our Coast said in a statement on Friday they welcomed Labor's decision to reject PEP11's renewal.
"We are opposed to the project because the risk to our precious marine environment, tourism sector and coastal lifestyle far outweighs any benefits, especially in a time when the entire world is moving away from fossil fuels and transitioning toward renewables," spokesman Tim Heffernan said.
Australian Associated Press