Faulks counsel Adam Copland announced the withdrawal before Judge Jon Jackson at an Environment Court pre-hearing conference in Queenstown this week, when he confirmed an application to withdraw the appeal had been lodged.
Mr Copland said the withdrawal related to issues surrounding other Faulks projects subject to appeal, which involved the lower Shotover River area downstream of Tucker Beach, where the company is seeking a consent to extract up to 100,000cu m of shingle a year.
He told the Queenstown Times an agreement had been reached between Faulks and the Tucker Beach Wildlife Reserve Protection Society.
"We agreed that if we withdrew our appeal of this matter, the society would not appeal our other consents downstream," he said.
The issue arose when Faulks, which believed it had existing use rights and had taken shingle from the river for "about 30 years", began shingle extraction in the Shotover River near Tucker Beach reserve more than three years ago.
The shingle and schist from the area was "very high quality" and the company had hoped to continue extracting and storing it on the site.
Mr Copland said the company obtained consent from the Otago Regional Council and also a concession from the Department of Conservation.
"I believe they have done everything they were supposed to," Mr Copland said.
However, David Broomfield, of the protection society, said it was "a disgrace" consents and concessions had ever been given for an area of the Shotover which was classed as an outstanding natural feature.
The 121.4ha area was a wildlife reserve and should be kept for future generations, he said.
"We are not worried about the area below the [Shotover] bridge," he told the Queenstown Times.
Faulks' decision to withdraw did not mark the end of the society's fight to preserve Tucker Beach, he said.
The group had spent over $300,000 to date on the legal battle and were now looking to recover some of their costs.
Mr Broomfield also wants Faulks to clean up the area they were working in to make it usable by the public.
While the company had not been extracting from the area for the past nine months, a considerable amount of damage had been done by rippers and other machinery.
"They were building the whole river area into a channel," Mr Broomfield said. "It is a protected area . . . of a naturally braided river."
He described the reserve as one of Wakatipu's "best-kept secrets" and often calm when other areas were cold and windy.
He said the society which had been formed to fight the consents was now offering to help with the management of the area.
At the pre-hearing conference Judge Jackson gave the society's counsel Russell Ibbotson until February 27 to make an application for costs, after which Mr Copland must respond by March 13.
Judge Jackson would then consider whether costs should be awarded and issue a decision accordingly.
When contacted by the Queenstown Times, Faulks manager Tony Brookes said he had no comment to make.
