The Adnyamathanha group says it was not properly consulted on plans for a controversial mining trial and has launched Supreme Court action to halt the project.
Leigh Creek Energy announced this week it had received approval from the state's energy and mining minister to begin a three-month underground coal gasification (UCG) trial at a former mine site at Leigh Creek, in the state's north.
UCG, or in situ gasification, involves setting fire to underground coal to extract gas.
On Thursday the Traditional Owners sought an urgent Supreme Court injunction, arguing the necessary statement of environmental objectives was invalid or inappropriate.
Outside court, Adnyamathanha Traditional Lands Association chief executive Vince Coulthard said he was surprised permission was granted, given his previous conversations with the minister.
He said the local Indigenous community was consulted about the project but "not to the way they should".
"There's been consultations happening, no denying that," he said.
"However, we sort of feel that could've been done in a better way."
Mr Coulthard said the land had already been damaged through previous mining operations, and now "a healing process needs to be put it place".
Leigh Creek Energy was on Thursday morning placed in a trading halt pending an unspecified announcement, and said it was therefore unable to comment on proceedings.
The case was adjourned until Monday, after lawyers for the minister and Leigh Creek Energy said they were only served with court documents on Wednesday night and needed time to "digest the nature of the challenge".
Conservation SA chief executive Craig Wilkins says UCG has been banned interstate and across the globe because of the damage it causes.
"In April 2016, the Queensland government legally banned UCG after the worst contamination event in that state's history at the Hopeland Linc Energy Plant," he said following Leigh Creek Energy's announcement.
"We are outraged that this dangerous technology has been given the go ahead in South Australia."
Linc Energy - now in liquidation - was earlier this year found guilty of serious environmental harm over at its UCG plant on Queensland's western Darling Downs.
AAP
