Solid Energy has hit back at criticism from the Green Party that its trial of a technique that turns coal into gas deep underground is unsafe.
The state-owned company started trialling the technology at its pilot plant near Huntly in Waikato last week.
To convert the coal into gas, air is pumped into one of two wells drilled 350 metres down into the coal seam, and coal is burnt along the seam forcing gas to the surface.
The technique is 70 years old and has been used in 15 countries.
Solid Energy says two billion tonnes of coal could be tapped that would otherwise be uneconomic using conventional methods.
The Green Party is urging independent monitoring of what it says is a dangerous technique which has the potential to contaminate groundwater.
But Solid Energy says it will be regularly collecting samples that will be tested by a third party and the site will be the best monitored in the world.
Chief executive Don Elder told Morning Report the extraction is low-risk, with only a minimal environmental impact.
He says a nearby aquifer will not be at risk, as the wells are sealed tight.
Dr Elder says the company will conduct air and water quality tests that will be independently audited.