The rally will coincide with a community consultative meeting set up to consider the project.

Rally organiser and Hands Off Our Coast spokeswoman Phillipa Parsons said the application was approved without proper consultation.

Ms Parsons said Hunter residents were in the dark about the "real and potential risks to our marine and coastal environment".

Greens MP and mining spokeswoman Cate Faehrmann said a federal inquiry report released on Wednesday about last year's Montara oil spill off the Northern Territory was a "grave warning" for Novocastrians.

The spill lasted for 10 weeks and leaked 29,600 barrels of oil into the Timor Sea.

She said it raised questions about the NSW government's ability to regulate offshore petroleum exploration.

"Novocastrians are right to be deeply concerned about potential environmental impacts associated with the [Newcastle] approval," she said.

Advent Energy, through its subsidiary company Asset Energy, plans to begin drilling in December.

Drilling will take up to 30 days in 143-metre-deep water, with a well-depth of 826 metres.

Preliminary studies estimated 13.2 trillion cubic feet of gas worth $50 billion was in the company's offshore petroleum licence area from Newcastle to Wollongong.

The drilling could lead to a natural gas industry with the potential to create tens of thousands of jobs and generate billions of tax dollars for government.