According to ABC News, Australian Bight Abalone is in voluntary administration and a series of meetings of investors is being held.
Elliston residents have questioned issues including how the business was allowed in a sensitive environmental area, reports the news organisation.
SA Opposition fisheries spokesman Adrian Pederick says there may be nothing untoward, but the company's establishment and operation warrant a select committee inquiry.
"Certainly this does not warrant just slipping under the carpet. I think there needs to be an investigation how Australian Bight Abalone has been structured," he told ABC News.
However, SA Fisheries Minister Paul Caica has rejected the call for a select committee.
He says he is confident that the processes for granting and conversion of leases and licences under the Aquaculture Act are rigorous and transparent.
Call for Australian Abalone Enquiry Rejected
AUSTRALIA - The Opposition is demanding a parliamentary inquiry into a failed west coast aquaculture company in South Australia.
