Shares in Tabcorp rose as much as 2.1 per cent today after it reached a deal with the NSW Government to remain the sole owner and operator of a casino in NSW.

The company owns the Star City casino in Darling Harbour, Sydney.

“NSW remains a one-casino state,” NSW Premier Morris Iemma told reporters.

By mid afternoon, Tabcorp was up 1.3 per cent at AUD 15.31 in a broader market down 0.4 per cent.

Mr Iemma said he made the announcement to “end the silliness and nonsense” that had been going on amid speculation about a second casino being built in NSW.

Most recently it had been reported that James Packer’s Publishing & Broadcasting Ltd had been the front runner for the second casino licence, with the potential site in Sydney or on the Queensland border at Tweed Heads.

But Mr Iemma said he had never spoken with Mr Packer about a second casino and denied he had been lobbied by his own close friend Peter Barron or former Labor senator Graham Richardson on the issue.

He did, however, admit he had spoken “a few times” with Mr Packer about the issue of online-betting exchange Betfair being able to have a presence in NSW.

“He has put the issue of Betfair as a proposition that he wished to have examined by the government,” Mr Iemma said.

“My response to Mr Packer has been that the government would examine his proposal fairly, on its merits and I understand that the process is the very process that his organisation has been engaging in with my minister.”

He said Mr Richardson was in attendance when the issue was first raised two years ago, but it was one of a number of issues including Mr Iemma’s becoming premier, health and education.

“There is no need for him (Mr Packer) to have lobbyists to apply pressure when he has raised it with me,” Mr Iemma said.

Betfair yesterday said it was in talks with the NSW Government to be able to advertise fields and sponsor races in NSW, in a move it says could be worth up to USD 10 million a year within five years for the NSW Government.

Betfair already has an operating licence in Tasmania, which enables punters across the nation to place bets with the online exchange.

However, regulations prevent it from advertising and sponsoring races outside the island state.

The NSW Government is looking at possibly amending these regulations for all interstate waging operations, of which Betfair is one.