The Tasmanian Government has been urged to buy a major undersea gas pipeline.

The pipeline supplies natural gas to Tasmania, travelling under Bass Strait from Longford in Victoria.

Grange Resources' Ben Maynard it would be better in public hands.

“Strategically I think it is an asset that Tasmania could benefit from,” he told reporters over the weekend.

“The way it's situated at the moment I'm not sure it's giving us the best value.”

State-owned power generator, Hydro Tasmania, is currently engaged in months-long talks with the owners Tasmanian Gas Pipeline (TGP) and has struck a “take or pay” agreement that expires at the end of the year.

It comes after Government's own energy security taskforce recommended a deal be struck in the first quarter of this year.

Grange Resources is one of Tasmania’s major employers, and relies on gas from the pipeline to dry iron ore pellets produced at its facility in Port Latta, among other uses.

Mr Maynard said the extended talks about the pipeline’s ownership are beginning to make business difficult.

“We do need to lock into long-term contract for our gas and with that uncertainty we don't know what the price will be going forward, and that's made it difficult for us to make a commitment,” he said.

“Our backs are up against the wall with it really.”

TGP does not seem very interested in selling the asset, and is instead angling for a new gas deal.

“But if a solution is not found soon, an expensive and time-consuming arbitration process may be put in place,” a spokesperson said.

The state’s energy minister, Guy Barnett, says he is “confident future arrangement will be in place well prior to the expiry of the contracts”.

“However arbitration is an option if a resolution is not forthcoming,” he said.