Councillors have voted against revoking an order on a gasholder in East Greenwich which could stop a school from opening as planned in September.

A hazardous substances consent remains on the gasholder in Millennium Way, and all the while the licence exists St Mary Magdalene School would be unable to function.

Councillors were asked to revoke the licence, which would also mean the Silvertown Tunnel can only be built but not used.

This is because of a restriction included in the Government’s permission for the controversial tunnel, which was granted last month.

Planning officers told Greenwich’s planning board that “the most pressing issue” for revoking the order was the opening of the school later this year.

“There’s a clause in the lease preventing any occupation of the school unless the consent of the order is revoked,” councillors were told.

A previous bid was pushed back over fears gas distribution company SGN would seek compensation from the council if it remove the licence, although assurances have been given that no money would have to be paid.

Despite no gas being stored in the historic structure since 2013, councillors were concerned that by revoking consent they were doing developers a favour – as it would make the land easier to develop.

A local campaign to save the Victorian structure has been established as SGN has been given “prior approval” to demolish the structure.

Cllr Nigel Fletcher, who has supported the campaign, said: “We are essentially doing something that will increase the value of the land.

“I’m not convinced we should be doing SGN a favour by increasing the potential of their site until we have assurances of their intentions with regards to the gas holder.

“We can revoke the condition stopping the school from opening. That can be got around. That shouldn’t be used as an excuse.”

However, Cllr Sarah Merrill, chairing the meeting, said: “I have enormous sympathy with what has been said, but we are where we are and on the basis that it does hold up the ability of the school to function properly, I will be voting for the revocation of the licence.”

Councillors voted six to five against the decision, meaning the revocation was defeated and the order remains in place.

The transport secretary can intervene over the decision.