AGL said the NSW government had completed an analysis of samples from the CSG pilot and found there was no evidence of harm to the environment or pollution of local waterways.

AGL voluntarily suspended the project in late January in response to the detection of BTEX in samples of flowback water taken from two of the four Waukivory Pilot wells and an above ground storage tank.

Both the NSW Division of Resources and Energy and the Environment Protection Authority undertook a comprehensive three-month investigation and found no evidence of harm to the environment and no water pollution.

The BTEX was described as being naturally occurring, generated from the 600m-deep coal seams.

Further, there was no evidence of contamination of any of the shallower aquifers.

Both the EPA and DRE have confirmed that no BTEX was used in any fracture stimulation fluid during the hydraulic fracturing process.

The EPA also investigated the detection of chemicals MEB (a thickening agent) and THPS (an algaecide) in flowback water and found the levels were “low and unlikely to pose any risk to human health or the environment”.

The EPA said these chemicals occurred naturally and it was unlikely the detections were a result of hydraulic fracturing activities.

AGL's acting upstream general manager Scott Thomas welcomed the findings.

With no adverse findings against the company, AGL is now able to resume operations at the location outside Newcastle.