Fracking has been ruled out in the Sussex village which became the focal point of demonstrations in the summer.
Drilling firm Cuadrilla wrote to villagers in Balcombe yesterday to tell them the site, which they spent more than a month testing last year, was not suitable for the controversial extraction technique.
But the Staffordshire-based firm has submitted a further planning application to “flow test” the site for more conventional extraction.
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A spokeswoman said: “The company was expecting to, and did indeed, find oil. However without flow testing Cuadrilla cannot be sure at what rate the oil may flow to the surface.
“The new application will effectively cover the same well testing work scope that was permitted activity in Cuadrilla’s previous planning permission.”
Furious fracking protesters dismissed the news, adding that the new development was intended to “lull local people into a false sense of security”.
Vanessa Vine, from the Frack Free Sussex Group, said: “They are trying to avoid the F word to throw good people off their scent, but no one who has looked below the surface of this will be fooled one iota.”
Last year Cuadrilla carried out exploratory drilling at the Lower Stumble site in the village.
Although it did find oil, company experts told The Argus the rock under the site was naturally fracked – and therefore unsuitable for fracking.
The new application will look at extracting the oil in more conventional ways.
A company spokesman added: “These proposed flow testing operations are significantly smaller in scope than drilling operations.
“The main testing operations would last some three to five weeks after which the well would be closed in and monitored forupto 60days.Asalways, we will continue to keep the residents of Balcombe and Balcombe Parish Council updated.”
Brenda Pollack, from Friends of the Earth, said more information was needed on the application.
She said: “While residents will undoubtedly be relieved, the community still faces the prospect of significant industrial activity on its doorstep.
“Local people will want more information about Cuadrilla’s plans and the potential impacts on their community and environment.”
Ms Vine added that the company could expect similar scenes to those last summer if it continued its work at the Balcombe site.
She said: “If permission is given their shareholders will come to regret it bitterly and wish they had invested wholly in safe renewable energy technologies instead.
“People have had enough of being lied to and told that international frack dealers have our communities’ best interests at heart.”