Gas storage firm Infrastrata has confirmed on its website that it has started drilling at Woodburn Forest in Co Antrim.
However, those monitoring the site said there is no evidence that work is under way.
Alliance MLA Stewart Dickson said confirmation was needed around the situation at the site.
He said: "It is certainly extremely worrying that Infrastrata has claimed work has begun in Woodburn, particularly when the need for any such action is still highly questionable.
"Alliance has long supported all lawful efforts to stop the drilling and restore confidence in our water system. Earlier this year, I signed an Assembly Petition seeking a review of the extension granted to the drilling and we have continued to repeatedly question the former Department of Environment over its granting permission for the drilling by default.
"Local residents, and those further afield who could be affected by this work, have a legitimate concern about potential pollution of the local water supply. For work to have possibly started could make it a sad day for East Antrim – drinking water may be poisoned, while part of a scenic forest could be destroyed. We might yet see some disastrous consequences for our environment."
Andrew Hindle, CEO of InfraStrata, said: "It has been five years since we were awarded a petroleum licence. In that time we have acquired the first extensive seismic surveys across the Larne-Lough Neagh Basin in 2011 and 2012, confirming the prospectivity of the basin and ultimately leading to location of Woodburn Forest for drilling an exploration well.
"InfraStrata's conventional exploration programme in County Antrim is an important part of our strategy, with successful exploration capable of delivering significant upside for our shareholders and Northern Ireland."
Demonstrators raised concerns that the drilling by Infrastrata may effect the drinking water in the area, however NI Water said there is no danger to the water supply.
(CD/JP)
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