Opponents warn of coal gas threat to seabed.
Earlier this year investment company Cluff Natural Resources plc was awarded a licence by the Coal Authority to explore a project to create "syngas" from seams beneath the estuary.
The company wants to gasify coal using a process that involves drilling a bore hole and igniting the coal.
Burning the coal will create a synthetic natural gas consisting of hydrogen, carbon dioxide and carbon monoxide, which will be piped to the surface and used to generate electricity or help make fertiliser.
Keith Ross, of Swansea-based Safe Energy Wales, said: "There will be a huge void left is this method of extraction does go ahead.
"Because the seam is not that far from the surface any collapse of the sea bed could have severe consequences and there is also residue such as ash to consider."
Part of the Loughor Estuary falls within the Gower area of outstanding natural beauty.
The whole estuary also forms part of the Carmarthen Bay and Estuaries special area of conservation and is very close to the Burry Inlet special protection area and Burry Inlet Ramsar site a wetland of international importance.
Algy Cluff, managing director of Cluff Natural Resources said that gasifying coal posed "no threat to the environment or individuals."