Taxpayers face an $80 million payout to energy company Metgasco after the NSW government confirmed it will not appeal a court ruling overturning its bungled suspension of the firm's gas drilling licence on the north coast.

Energy minister Anthony Roberts has told Metgasco the government would not appeal the Supreme Court decision that an order by the Office of Coal Seam Gas to suspend drilling was "unlawful".

NSW government has decided not to appeal a Supreme Court decision that its suspension order to Metgasco was unlawful. Credit:Glenn Hunt

The suspension announcement in May last year came days before police were due to be sent in to break up a long-running protest blockade at the drilling site at Bentley on the NSW north coast.

It saw Metgasco's share price plummet by 40 per cent.