Residents of a town in South Australia's far north are preparing to fight the State Government in court over moves to wipe the town from the map.

About 30 mostly non-Indigenous people call the opal mining town of Mintabie home in the Anangu Pitjantjatjara Yankunytjatjara (APY) Lands.

Some locals received eviction notices from the Department for Energy and Mining last month, telling them to leave by February 11, 2019.

An extension until the end of February was granted to those residents that day by the Minister for Energy and Mining, Dan van Holst Pellekaan.

It was also confirmed in those letters that the APY Lands executive board would not allow residents to live in the town once it was transitioned to their control from July 1, 2019.

Locals have faced the prospect of eviction after the former state government released a damning report into the town last year, which found it to be a hub for violence, lawlessness, and drug running into the APY Lands.

Locals have strongly denied the review findings.

The review prompted the former state government to end the town's lease — a decision carried on by the current government.

Mintabie opal is considered some of the finest in Australia and the world. ( ABC News: Paul Culliver )

The town has been leased to the South Australian Government by the APY Lands for the purposes of opal mining since the 1980s.

Legal challenge only option

Mintabie Miners and Progress Association (MMPA) lawyer Todd Grant said he was preparing to lodge his case with the Federal Court "as soon as possible" to prevent evictions from taking place.

"I wrote to the Crown Solicitor's office on behalf of the MMPA saying that we considered that the APY Act in its current form is inconsistent with the Federal Racial Discrimination Act and to that extent the act is invalid," Mr Grant said.

The Crown Solicitor rejected all legal assertions made by Mr Grant, all but guaranteeing court action.

Mr Grant said news that no-one would be allowed to live in Mintabie disappointed locals considering previous comments from Mr van Holst Pellekaan, who said he was working to ensure genuine residents could live in the town.

"I wrote to the APY Lands executive in August and September asking to sit down with their Mintabie sub-committee and work out what was going to happen — I never heard back," he said.

"The residents don't believe this is a good resolution and he [Mr van Holst Pellekaan] doesn't appear to have succeeded in assisting residents, genuine residents, some of whom have lived here for 40 years, to stay."

He said many residents were unable to move without financial assistance, which has so far not been forthcoming from the State Government.

A local flies the Eureka stockade flag at Mintabie in protest over the State Government's decision to close the town. ( ABC News: Paul Culliver )

"One of the difficulties residents face is that a good deal of them are pensioners, they don't have any spare cash and they either must pay their campsite fees or work out how to move from Mintabie," Mr Grant said.

"These people are struggling to make financial decisions when they don't have the finances to do so."

If the case goes to the Federal Court it will be only the second time the validity of the APY Lands Act has been tested.

In 1985 a non-Pitjantjatjara-Yankunytjatjara Aboriginal pastor attempted to gain access to the Lands without a permit.

The High Court found he could be excluded under a "special measure" designed to assist a disadvantaged group.

Mr Grant said the legal battle was not the preferred option, but the community had been left with no choice.

"To be blunt, the outcome we're hoping for is that the State Government will actually sit down and negotiate with us," he said.

"We've been asking to sit down with the State Government for a very long time and we haven't met with much or any success in that regard."

Residents prepared to fight

Resident Marg Venturi has lived in Mintabie for nearly 40 years and said news that no residents would be allowed to stay has stunned the community.

"I haven't got an eviction notice yet, but I dare say it will come," Ms Venturi said.

Mintabie resident of nearly 40 years, Marg Venturi, says it's a stressful time for the community. ( ABC North and West: Patrick Martin )

"We've got some legal work going on to prevent that from happening, so hopefully something comes of that."

She said ongoing financial pressure was a key issue for many, with the State Government not yet offering financial support to move.

"A couple of people have already left, a few elderly that are old, scared and confused have moved on but most of us are still here," she said.

"I've got nowhere to go … this is my home.

"I can't work out what's going on. People have lived here, myself included, since 1983 I've been here.

"There are people that have been here since the 60s and now all of a sudden we have to go.

"It's just unrealistic, it's crazy and totally un-Australian if you ask me."

The review, which condemned the town, also questioned the future of the opal field and remediation of Mintabie.

A decision on the future of the opal field was expected in December but has not been made public.

It remains unclear who will pay for the remediation of the town, which is expected to cost $2–$3 million.

Government defends management of closure

Mr van Holst Pellekaan defended his handling of Mintabie's closure.

"We have tried to be as open and transparent as possible about the transition process for Mintabie since the former state government made the decision in February last year," he said.

"But the threat of legal action unfortunately impedes the Government's and the Minister's ability to attend meetings with affected people and participate in media interviews.

"The APY, which owns the Mintabie township land freehold, has reinforced its position to the current government that it does not want the township on its land.

The Mintabie review said remediation of the town would cost $2–$3 million, with many derelict structures and cars needing to be fixed or removed. ( ABC News: Paul Culliver )

"Mintabie residents have only ever had 12-month licences to live legally in the town, and in June 2018 the state government gave all legal residents of Mintabie a new 12-month licence with advice that it would not be renewed in June 2019.

He said legal Mintabie residents had been offered support to reallocate to state-owned housing at Coober Pedy, Port Augusta and other locations.

"People living illegally at Mintabie without licences and without any permission whatsoever to be there have been asked to contact the Department for Energy and Mining by February 28, 2019 to identify their plans for the relocation from Mintabie," he said.

APY Lands general manager Richard King declined ABC requests to comment.

"I am in New Zealand and will be speaking with no-one," Mr King said.