The Environment Protection Authority has suspended the licence of a Coffs Harbour quarrying company.
Wyanga Holdings which operates the Corindi Quarry, has had its licence revoked until January 31, 2014.
The action by the EPA comes after the company was found to have exceeded its extraction limit as specified in its licence.
EPA Northern Region director Gary Davey said the company had been given plenty of time to comply, ABC reported.
"Suspension is not an action the EPA takes lightly," he said.
"We gave Wyanga Holdings numerous warnings about exceeding the limits on its licence, including a notice of intention to suspend, before taking the decision.
He said the gravel is being used for the Pacific Highway upgrade.
"Their licence entitles them to extract 50,000 tonnes of material a year,' he said.
"This current year they've extracted already in excess of 300,000 tonnes.
Davey said further legal action was being considered.
"It appears the quarry doesn't have the appropriate development consent from the council or the Department of Planning and Infrastructure to operate the quarry at this level," he said.
"Because they've breached their licence conditions and breached it by such a significant amount, that prima facie is an offence under the Protection of the Environment Operations Act.
"So we could actually bring charges against the quarry operators and we could take that matter to the Land and Environment court."
The EPA said Wyanga Holdings has 21 days to appeal against its licence suspension.