A judge has ruled that former prime minister Scott Morrison's decision to reject a gas exploration licence off the coast of New South Wales was “infected by apprehended bias”. 

The decision to reject the two-year extension of the exploratory drilling licence, PEP-11, which covers about 4,500 square kilometres offshore from Manly to Newcastle, was made at a time when Mr Morrison had sworn himself into the portfolio of then-resources minister Keith Pitt, circumventing Mr Pitt's intention to grant the extension. 

Asset Energy, which owns an 85 per cent interest in PEP11, sought orders against the Commonwealth quashing the decision, alleging it was affected by bias in the form of predetermination. 

The case has been vacated, paving the way for a future decision on the project. 

The court found Mr Morrison's public comments conveyed “implacable opposition” to the licence application, leading the judge to make orders that the PEP-11 decision be quashed, that the application be remitted by the relevant joint authority “to be determined in accordance with law”, and for the Commonwealth to pay Asset Energy's costs. 

The decision now rests with a joint authority made up of the Albanese and NSW governments.