The Hunter Gas Pipeline would connect the $3.6 billion Narrabri Gas Project on NSW's northern tablelands to Newcastle and the east coast market.
However, oil and gas giant Santos can't proceed with land surveys without approval from Energy Minister Matt Kean.
Farmers and environmentalists on Thursday delivered a petition from 215 landholders along the pipeline's route to Mr Kean's office.
The petition said the pipeline would disrupt and jeopardise high-value farmland and become a stranded asset as the energy sector transforms.
Victoria Congdon, whose property in the Upper Hunter Valley touches the 30-metre-wide pipeline corridor, said the project would require substantial environmental damage.
"It's an obscene imposition on landholders, who have to modify their lives for a project that is outdated and not wanted," she said.
Western Liverpool Plains beef farmer Margaret Fleck said the gas pipeline could upset the delicate environment in the area, particularly groundwater feeding the Great Artesian Basin.
"The big thing about where we live ... is we are utterly dependent on groundwater," she said.
"Our rainfall, while adequate for growing plants, is vastly exceeded by evaporation rates."
The Narrabri Gas Project, across 95,000 hectares in the Pilliga forest and nearby grazing land in northwest NSW, has the potential to provide up to half of NSW's natural gas needs in the next 20 years.
Up to 1300 construction and 200 operational jobs will be created, the oil and gas giant says.
As well as connecting to Newcastle, the pipeline project is planned to run 400km north to Queensland's Wallumbilla gas supply hub, providing a second route to southern markets for Queensland gas and adding competition to the domestic market.
The battle for the pipeline comes a week after the company lost an appeal to resume its multibillion-dollar Barossa gas project off Australia's northern coast, against the wishes of Tiwi Islands traditional owners.
"Santos, we know, is right now in a corporate bully mentality," Greens MP Sue Higginson said.
"Their bullying didn't work in the Tiwis and we don't want it to work here."
Santos has been contacted for comment. On its website, the company said the proposed land survey activities would be undertaken by specialist consultants operating under the company's supervision.
"Before any survey works commence, Santos will meet with landholders to obtain consent on the areas of property to access and on what and when this will occur," it said.
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