(Adds Dominion comment)
July 26 (Reuters) - A U.S. appeals court on Friday vacated a permit by the U.S. Fish and Wildlife Service that allowed Dominion Energy Inc to build its Atlantic Coast natural gas pipe from West Virginia to North Carolina in areas inhabited by threatened or endangered species.
Dominion suspended construction of the long-delayed $7.0-7.5 billion project in early December after the 4th U.S. Circuit Court of Appeals in Richmond, Virginia, stayed the Fish and Wildlife Service's permit, called an incidental take statement.
The court on Friday found the Fish and Wildlife Service fast-tracked its decision to reissue an incidental take statement in 2018 19 days after federal energy regulators resumed formal consultation with the agency following the court's decision to stay an earlier version of the permit from 2017, Fourth Circuit Chief Judge Roger Gregory said in the court's opinion.
"In fast-tracking its decisions, the agency appears to have lost sight of its mandate under the (Endangered Species Act)," Gregory said, noting the Fish and Wildlife Service's decisions in granting the 2018 incidental take statement were "arbitrary and capricious."
In response, Dominion said it expects the U.S. Federal Energy Regulatory Commission (FERC) and the Fish and Wildlife Service will be able to immediately begin working to correct the errors identified by the court.
"Once the new Biological Opinion and Incidental Take Statement are issued, we will seek the necessary approval from the Federal Energy Regulatory Commission to resume construction," Dominion spokesman Aaron Ruby said in an email.
"We’re confident we remain on track to complete the project by late 2021," Ruby said.
When Dominion started work on the 600-mile pipe in the spring of 2018, the company estimated it would cost $6.0-$6.5 billion and be completed in late 2019.
Reporting by Scott DiSavino; editing by Jonathan Oatis, Bill Trott and Sonya Hepinstall