Solid Energy is putting commercial production of gas from coal at Huntly on hold until the economics of the scheme improve.
However, the company remains confident in the long run and is extending its research to north Taranaki.
Gas developments manager Steven Pearce says Solid Energy has proven the Huntly scheme is reliable, but the costs of production are too high in view of the current price of gas.
He says an independent appraisal indicates enough gas in Taranaki to power a 400 megawatt electricity station for 45 years.
Dr Pearce says the technology involves drilling to a coal seam, pumping out water, collecting methane gas and leaving the coal in the ground.