THE SNP energy minister has refused to extend a moratorium on fracking to cover a controversial method of burning coal underground, despite pressure from environmentalists and a growing campaign within his own party.

Fergus Ewing, who faced questions over the issue at Holyrood, was accused of adopting a "puzzling" stance over the issue with Labour MSP Malcolm Chisholm describing the technique as "the most frightening and experimental method of unconventional gas extraction" with "unacceptable climate change implications."

Mr Ewing has resisted calls since January to include UCG in the moratorium, which will remain in place until further research and a public consultation is carried out. The minister, who is seen as being on the right of the SNP, said that licensing of underground coal gasification (UCG) projects was not being devolved, ignoring the fact that Holyrood has the power to block them through the planning process.

Industrialist Algy Cluff plans to exploit the technique under the Firth of Forth and this week released a report which claimed UCG could create 5,000 jobs in Scotland and generate £6 billion for the economy.

UCG, which sees hard-to-reach coal seams ignited underground in situ with gas then siphoned off through wells, has prompted strong opposition from within the SNP. A new group, SNP Members Against Unconventional Oil and Gas (SMAUG), has been established with the aim of having UCG included in the moratorium, prominent MPs have publicly called for the move and a motion will be debated at the party's conference next month.

Iain Black, one of the co-founders of SMAUG, said that the group had been "overwhelmed" by support and heartened by the response from SNP politicians.

However, Mr Ewing gave no indication that a u-turn was imminent. He said he would "continue to listen carefully to the views that are being expressed by communities and stakeholders on this matter" and, in response to the pro-fracking Tory MSP Murdo Fraser, that he was looking forward to studying the economic report released by Mr Cluff in detail.

Following the exchange, Flick Monk, unconventional gas campaigner at Freinds of the Earth Scotland, described the government approach as "hugely frustrating".

She added: "Underground Coal Gasification is risky and experimental. The Scottish Government is keen on an evidence-based approach to policy so to be consistent it must review all the proposed unconventional fossil fuel technologies, including UCG. Adding UCG to the moratorium would allow the health, environmental and climate change impacts to be reviewed.

"It is entirely within the Scottish Government’s power to stop UCG developments. We call on the Scottish Government to listen to concerned communities across Scotland and place a moratorium on UCG before this unwanted industry gets its foot in the door."

Mr Cluff, in a series of newspaper articles this week, stepped up his campaign to win acceptance for UCG. He argued that "Scotland stands on the brink of a North Sea mark II" and that the results of the economic report "should excite everyone who cares about Scotland's economy and jobs." He said that fears over uncontrolled fires and water contamination were unfounded.

Cluff Natural Resources said: "We are greatly encouraged by the Scottish Government's renewed commitment to evidence led policy on UCG which supports our position that there are no significant risks associated with an appropriately located, engineered and operated UCG project.

We are also pleased that the government recognise the significant employment and economic benefits which would be created by seizing the opportunity to become world leaders in what will undoubtedly be a significant global industry - extracting hydrocarbon resources offshore and building on the country’s existing strengths in the oil and gas sector."