Planning Minister Justin Madden announced last Thursday that the State Government would not intervene in Yarra Ranges Council's decision to prevent the expansion of the quarry.

In November, the council and the Planning Department unanimously rejected Boral's application to expand the quarry. But in late January, Boral lodged an appeal to Mr Madden, requesting that the Government overrule the council's decision.

"I have decided not to assume the role of planning authority and prepare the amendment that would be necessary for the quarry expansion to proceed,'' Mr Madden said.

"My decision was based on the fact that intervention was not warranted.

"In view of the council's decision that the amendment will not proceed, there is no practical purpose to exhibit the environment effects statement prepared by Boral.''

Stop Montrose Quarry Expansion treasurer David Dobson said he was rapt over the Government's decision.

"What this means, I believe, is that the expansion is now dead.

"I would imagine there will be a great deal of happiness and plenty of celebrations. I think the State Government has made a good decision in light of the message from our local government - that should be it now.''

Mayor Tim Heenan said the issue had "come back to the council so many times'', but the minister had "done the right thing''.

"It means the community will now have more of an understanding that the likes of the quarry is coming to an end, depending on how much rock they've got left.''

Monbulk MP James Merlino welcomed the minister's decision.

"Yarra Ranges Shire Council has made its decision based on careful consideration of all the issues involved, including the views of the local community, and it is appropriate that it retains planning control.''

Boral general manager Paul Hillyer said the decision was disappointing.

He said Boral carried out 15 independent studies for the EES which showed the extension would have no detrimental environmental or social impact.

"We have been denied the opportunity to have the EES properly and fairly assessed by an independent panel.

"The cost of road-making and other infrastructure projects is likely to rise through decisions such as this which will reduce the access to high-quality resources close to the market.''

Mr Hillyer said Boral would "fully evaluate the implications of the minister's decision over the coming weeks and its impact on the continuing operations of the Montrose Quarry''.