Ron Davies was selling raffle tickets about 50 metres away and heard the gun shot. The scene of the shooting in Picton. Credit:Top Notch Video "The guy who was shot said to the other guy 'don't do it' and he just went bang and shot him," he told AAP. The shooter, believed to be linked to the Rebels bikie gang, fled the scene, sparking a massive police search. Armoured vehicles, tactical police and PolAir flocked to the small town in search of the armed man.

Employees from businesses along the town's main strip were urged to stay indoors and schools were placed into lock down. Rebels member Darren Wallace, 32, was shot dead in Picton. Credit:Facebook An employee of a nearby candle shop said he was serving a customer when he heard a loud bang. "I just heard a big bang and then someone came down the street and said someone had been shot," the man, who was 50 metres away from the scene, said. Police on the streets of Picton following the shooting on Wednesday afternoon. Credit:Channel Ten

"I honestly thought it was a flat tyre." Fairfax Media has been told there were further reports of gunfire before police found a body, believed to be the shooter, in Picton Creek. Police closed off streets in Picton following the fatal shooting. Credit:ABC 24 A gun was recovered nearby and police are investigating whether he shot himself. A local man said after the service station shooting the gunman hid in a creek behind the pub and a police helicopter spotted him.

"The police all ran towards where he was," he said. "The police helicopter was hovering for about 15 minutes really low. Then we heard a loud bang. "After that happened all the police took off their bulletproof vests." Sources say there is speculation in the town an internal conflict within the Rebels club, brought on by a leadership vacuum, could have contributed to the service station shooting. The leadership of the club was thrown into turmoil last year after the Australian government cancelled the visa of Rebels' national boss Alex Vella while he was in Malta.

Not long after, the club's long-serving sergeant at arms Simon Rasic died of a heart attack, leaving further uncertainty among the top ranks of the club, which boasts 70 chapters. Damien Vella has since shifted into the Rebels' national president role. The area south west of Sydney is known as a Rebels stronghold with the group's club house maintained in Leppington. Mr Wallace owned the Such is Leather shop on Argyle St, a few hundred metres from where he was shot dead. Last month his business was peppered with bullets in a drive by shooting.

The shooting occurred in the middle of the night and no one was injured. Detectives are not sure if the drive-by is linked to Wednesday's fatal shooting. A neighbouring business, Picton Tattoos, which is run by the family of Bachelorette winner Sasha Mielczarek, was also hit in the drive-by on November 8. His brother, Jay, who works at the tattoo parlour posted on Facebook after the shooting. "I want everyone to know that I and everyone at the shop are fine in regards to the shooting in Picton today," he wrote.

"It had nothing to do with our shop thanks for all the love everyone." The Homicide Squad and Camden Local Area Command are investigating. with AAP