June 13 (Reuters) - The $6.6 billion Mountain Valley natural gas pipeline moved another step closer to restarting construction after West Virginia environmental regulators issued a new water permit, the partnership building the pipe said in court papers.
Mountain Valley told the U.S. Court of Appeals for the Fourth Circuit on Monday that West Virginia issued a renewed Section 401 water quality certification for the West Virginia-to-Virginia pipe on June 8.
The Fourth Circuit, which has vacated several of the project's federal and state permits, some more than once, was still hearing lawsuits by environmental and local groups opposed to the project.
The project is key to unlocking more gas supplies from Appalachia, the nation's biggest shale gas basin.
Analysts at Height Capital Markets, an investment banking and research firm, said language supporting Mountain Valley in the recently approved U.S. Fiscal Responsibility Act and issuance of the West Virginia permit "significantly raises the probability of a 2023 placed-in-service date" for the project.
Mountain Valley said in the court filing that it expects the U.S. Army Corps of Engineers to issue a Section 404 water permit by June 24, as mandated by the Fiscal Responsibility Act.
"Once (the Army Corps) does, Mountain Valley expects to resume construction," Mountain Valley said in the filing.
Mountain Valley, the only big gas pipe under construction in Appalachia, is one of several U.S. pipeline projects delayed by regulatory and legal fights with environmental and local groups.
When Mountain Valley started construction in February 2018, Equitrans Midstream Corp (ETRN.N), the lead partner building the project, estimated the 303-mile (488-km), 2-billion-cubic-feet-per-day project would cost about $3.5 billion and enter service by late 2018.
Mountain Valley is owned by units of Equitrans, NextEra Energy Inc (NEE.N), Consolidated Edison Inc (ED.N), AltaGas Ltd (ALA.TO) and RGC Resources Inc (RGCO.O).
Reporting by Scott DiSavino; Editing by Leslie Adler
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