Gina Rinehart-backed Lakes Oil faced off with the Victorian government in court on Wednesday as it fights against the state’s ban on gas exploration.

The company has been in limbo since 2014 when the Victorian government called a moratorium on all onshore gas exploration until 2020.

Lakes Oil has carried out legal action to re-open Victoria to gas exploration and production.

Lakes Oil initiated legal action in 2016, waging an almost $3 billion battle, to fight the ban.

It has the backing of major shareholder Gina Rinehart through her business Timeview Enterprises, which holds about 13.75 per cent of Lakes Oil, while Ian Plimer - a director on Gina Rinehart's Roy Hill mining company and a noted climate change sceptic - also serves on oil junior's board.